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Thursday, November 24, 2011

Bullions end modestly lower

They lose their safe haven appeal after German government bond auction failed

Precious metals ended modestly lower on Wednesday, 23 November 2011 at Comex. Concerns regarding Germany's failed bond auction jittered investors. But prices ended well up from the daily low on Wednesday. Bargain hunters once again stepped in to buy the dip in prices. However, it was another “risk-off” day in the market place on Wednesday, and that had the raw commodity sector, including precious metals, under selling pressure. The dollar headed up firmly.

Crude slips on global demand concerns

Strong dollar, weekly inventory report and economic data push prices lower

Crude prices ended substantially lower on Wednesday, 23 November at Nymex. Weaker than expected economic data from China and Wall Street coupled with lingering Euro zone's debt problems pushed prices lower today. A strong dollar and weekly inventory report also impacted prices.

Light and sweet crude for January delivery fell $1.84 (1.9%) to $96.17 a barrel on the New York Mercantile Exchange on Wednesday. Losses had picked up as U.S. stocks opened broadly lower, but moderated somewhat after the latest weekly inventory report from the EIA. Last week, crude lost 1.6%. For the month of October, oil futures gained 18%. During the third quarter ending in September, crude incurred losses of 17%. It was the worst quarterly performance for crude in almost two years.

Market likely to open sideways; inflation data eyed

The market is likely to see a flat-to negative start on Thursday on mixed Asian markets. Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a fall of 8.50 points at the opening bell. The market is likely to see high volatility today, 24 November 2011 as traders roll over positions in futures & options (F&O) segment from the near-month November 2011 series to December 2011 series.

The government will today, 24 November 2011, unveil data on some wholesale price indices viz. the food price index, the primary articles index and the fuel price index for the year through 12 November 2011.

Daily News Roundup - Nov 24 2011

Mr Cyrus P. Mistry will take over from Mr Ratan Tata as Chairman of the Tata Group when he retires in December 2012. (BL)

IL& FS Engineering and Construction Company Ltd (IECCL) has convened a meeting of shareholders and creditors next month under the direction of the Andhra Pradesh High Court, to secure approval to restructure the company capital.(BL)

BP and Indian Oil Corporation are planning to set up a 50:50 joint venture acetic acid plant in Gujarat. The two companies entered a memorandum of understanding to invest in a one-mn-tonne a year acetic acid plant with associated gasification facilities for production of synthesis gas. (BL)

Mayhem returns to D-Street...Sensex, Nifty hit 2-yr low

After a green day in the previous trading session, the Indian stock markets resumed their downfall, as a combination of domestic and overseas headwinds continued to play spoilsport.

Breaching of a key support level on the NSE Nifty was also partly responsible for heavy selling in the afternoon. What's worse, the sharp fall today came on rising volumes as traders looked to rollover their F&O contracts to the next month series.

The decline was massive as the Nifty fell as much as ~170 points intraday after the index slid below the 4650 mark, hitting two year lows. The BSE Sensex also touched a two-year low.

On a wing and a prayer

Helplessness induces hopelessness, and history attests that loss of hope and not loss of lives is what decides the issue of war. BH Liddell Hart.

We are looking at another weak start as overseas cues continue to be bleak and domestic headwinds remain strong. However, Asian indices have shown some resilience so far. Volatility will be high today on account of the F&O expiry. So, beware the intraday gyrations, especially in the afternoon. Some consolidation near 4600 is required in order to confirm an intermediate bottom.

Rupee Risks

Rupee Risks

SGX Nifty Live Update - Nov 24 2011

4706.75 +0.25 (+0.01%)

Negative start likely; Volatile day in store

Mounting European debt concerns may continue to worry markets. The start looks negative today tracking weak global sentiment.

Headlines for the day:

Idea to sell Rs5,850 smartphone in 3G push

Government looking into misuse of complaints against Tata Tele, RCom

IOC signs MoU with BP for acetic acid plant

Cabinet to discuss FDI in multi-brand retail today

RBI directs co-op banks not to process 3-mth-old cheques

Vikram Akula steps down at SKS