Yes Bank, Indiabulls Real Estate, Rallis, Crompton Greaves, Cairn India
Friday, October 21, 2011
Concerns of economic crisis in the Europe and earnings disappointment dragged the markets this week. The Sensex fell 1.74% and the Nifty slid 1.60% on weekly basis
Major news for the week
Food inflation at 10.6% versus 9.32%
FM says growth will be slower than expected
Rupee weakens past 50 a dollar for 1st time since May 2009
Exide Industries falls after Q2 results
L&T Q2 net profit marginally up
Crompton Greaves Q2 net profit declines by 29%
TCS Q2 consolidated net profit up 6%
HDFC Bank Q2 net profit jumps by 31%
HCL Technologies Q1 net profit surges 50%
The market declined last week, trailing weakness in global shares caused by disappointment over a quick European rescue plan. Investors feared building fresh positions as data showing acceleration of food inflation early this month raised prospects of more rate hikes from the central bank to tame inflation, which remains uncomfortably high. Stock specific action was witnessed as most index heavyweights announced their June-September 2011 quarter results.
The BSE Sensex fell 297.05 points or 1.74% to settle at 16,785.64 in the week ended Friday, 21 October 2011. The 50 share S&P CNX Nifty fell 82.35 points or 1.60% to 5,049.95.
High volatility is expected on the bourses in a truncated trading week. There are many variables for investors to grapple with, including corporate earnings, a policy review from the Reserve Bank of India (RBI), expiry of the near-month October 2011 futures & options (F&O) contracts and a European Union summit to finalise a package of comprehensive measures to tackle the euro-zone debt crisis. The near-month October 2011 derivatives contracts expire on Tuesday, 25 October 2011.
A special Muhurat trading session is being held on the bourses from 16:45 IST to 18:00 IST on Wednesday 26 October 2011 on account of Diwali. There is no regular trading session on that day. The market also remains closed on Thursday, 27 October 2011, on account of Diwali, the festival of lights.
Key benchmark indices edged lower for the second day in a row as a reduction in order growth guidance for the current year from engineering & construction giant L&T hit sentiment adversely. L&T reversed direction in late trade, with the stock tumbling nearly 4%. Another index heavyweight Reliance Industries (RIL) also edged lower in volatile trade. The BSE Sensex lost 151.25 points or 0.89%, off about 245 points from the day's high and up close to 35 points from the day's low. Except the BSE consumer durables index, all the other 12 sectoral indices on BSE were in the red.
State Bank of India has increased home loan tenures by 10 more years to 30 years. (BS)
Promoters have raised their stake to 25.18% in M&M. (BS)
Tata Motors is looking to raise US$750mn via overseas borrowing to meet working capital requirements and reduce debt. (BS)
SEBI is investigating whether an associate company of DLF duped an investor by using a maze of intermediary companies while purchasing land. (BS)
Progress is the activity of today and the assurance of tomorrow- Ralph Waldo Emerson
This weekend is no time to relax. Investors globally will anxiously wait to see the direction of the weekend meeting of European leaders for a comprehensive solution to the euro zone crisis. There is no consensus on how to strengthen a euro zone rescue fund. Immediate decision or solution is far fetched but signs of progress will provide some assurance. A plan is expected to be adopted by coming Wednesday.
Tracking gains in the Asian stocks, the Indian markets are likely to open on a positive note. Caution may prevail ahead of Europe summit
Headlines for the day:
Tata Motors to raise $750 mn via ECBs
SBI hikes home loan tenure to 30 years
M&M promoters raise stake to 25%-plus
Siemens sees growth in low-cost products
The market may open flat to slightly higher tracking gains in Asian stocks. Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a fall of 4 points at the opening bell.
Engineering & construction major L&T, Idea Cellular, paints major Asian Paints, JSW Steel and Godrej Consumer Products reveal Q2 results today, 21 October 2011.
Cairn India announced after market hours on Thursday that consolidated net profit fell 51% to Rs 763 crore on 1% fall in revenue to Rs 2652.20 crore in Q2 September 2011 over Q2 September 2010 as the company made a one-time provision for royalty payments on crude output from a key producing block in Rajasthan.