Bullion metals give up earlier gains

Lower crude price and rebounding dollar weaken precious metals

Lower crude prices and rebound in the US dollar led to lower bullion metal prices today, Tuesday, 22 July, 2008. Going economic concerns about the current health of the US economy had been increasing the metal’s demand as a safe asset against the rising inflation in recent times. Silver prices also fell for the day.

Comex Gold for August delivery fell $15.2 (1.6%) to close at $948.5 ounce on the New York Mercantile Exchange. Gold earlier rose as much as 1.4% to $977 an ounce, partly as a retreat in equity markets sparked safe-haven buying. Last week, it ended marginally lower by $2.6. On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped since then.

This year, gold prices have gained 13.5% till date against a 5% drop for the dollar against the euro. Gold prices ended June, 2008 with a gain of 4.1%. The yellow metal ended second quarter with a marginal gain of 0.7%. In May, it ended with a gain of higher by $22.5 (2.5%). Before May, for April, prices closed lower by 6.3%.

For first quarter prices gained 10.7%. In January, prices gained 11%, the highest monthly gain since April 2006. For February, it gained 6%. But in March, prices succumbed and fell by 5.5%.

Today, Comex silver futures for September delivery fell 42 cents (2.3%) to $18.005 an ounce. Silver has gained 21% in 2008 till date. For the second quarter, it gained a paltry 1.4%.

Silver prices ended the month of May 2008 with a gain of 2.7%. For April, it closed lower by 5.5%. Silver had gained 16% in Q1. In January this year itself, prices climbed 14%. In February, it gained another 15%. For March, it ended lower by 13%. The metal had climbed 16% in FY 2007. The metal also has gained for seven straight years.

Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies. On the other hand, a lower dollar pushes up precious metal prices as their demand lessens as it becomes cheaper for traders holding other currencies.

At the currency markets on Tuesday, the dollar index rebounded after dropping 0.3% yesterday on speculation borrowing costs may rise later this year. The dollar rose as much as 0.8% against a basket of six major currencies.

In the crude market on Tuesday, crude-oil touched a six-week low on forecasts a tropical storm in the Gulf of Mexico will miss oil fields and refineries, easing concern about supply disruptions. Crude oil slid as much as $5.41 to $125.63 a barrel.

The weakening dollar and higher global demand for raw materials have led to records this year for commodities including gold. Gold has traditionally been used as a safe-haven asset against rising inflation. Investor sentiments are boosted by the fact that gold and silver are alternate sources of good investment in the face of declining dollar and rising energy prices. Gold and oil has climbed 41% and 73% since the past one year.

During last week of June, Federal Reserve yesterday sharpened its focus on inflation, saying that the upside risks to inflation have increased. Fed held its target for short-term interest rates steady at 2%. Since last September, Fed has axed interest rates seven times and brought it down to 2%. On the other hand, after keeping interest rates unchanged at 4% since June, 2007, ECB hiked the same to 4.25% last month.

Gold had witnessed the greatest annual gain in twenty eight years by gaining $200/ounce (31%) in FY 2007 as lower interest rates had sent the dollar tumbling, and crude-oil prices rose to a record. In 2006, silver had jumped 46% while gold gained 23%.

At the MCX, gold prices for August delivery closed lower by Rs 231 (1.72%) at Rs 13,074 per 10 grams. Prices rose to a high of Rs 13,465 per 10 grams and fell to a low of Rs 13,025 per 10 grams during the day’s trading.

At the MCX, silver prices for September delivery closed Rs 537 (2.1%) lower at Rs 25,163/Kg. Prices opened at Rs 25,750/kg and fell to a low of Rs 25,000/Kg during the day’s trading.

Crude at lowest levels in six weeks

Prices drop as Dolly surpasses Gulf area

Crude-oil touched a six-week low today, Tuesday, 22 July, 2008 on forecasts that the tropical storm, Dolly, in the Gulf of Mexico will miss oil fields and refineries, easing concern about supply disruptions. The rebounding dollar also led further pressure on crude prices. Last week crude had coughed up almost $16.5 in four sessions. Prices had plunged once again on economic worries surrounding the US economy.

Crude-oil futures for light sweet crude for August delivery closed at $127.95/barrel (lower by $3.09/barrel or 2.3%) on the New York Mercantile Exchange. It slipped by 5.41% to $125.63 earlier during intra day trading. Crude for August delivery expired today. Yesterday, crude had registered the first increase in five days. Last week, prices coughed up $16.5 (11.2%). It's now 13.1% lower than the $147.27 record high hit last on Thursday, 10 July, 2008.

Crude prices gained 38% in the second quarter of this year. It was the biggest quarterly increase in nine years. It ended June 2008 higher by 9.9%. Prices are 73% higher than a year ago. For the year, crude is up by 36.4% till date.

Hurricane Dolly moved toward the Texas border with Mexico, avoiding most U.S. Gulf production. Yesterday, hurricane watch was issued for the Texas coastline from Brownsville to Port O'Connor at morning time by the Miami-based hurricane center. The northern Gulf of Mexico accounts for about 25% of U.S. oil production.

On the other hand, Iran had snubbed Western efforts to get it to suspend nuclear enrichment at talks in Geneva on 19 July setting the stage for new sanctions if the Middle East's second-largest oil producer doesn't respond to an existing proposal within two weeks. This also led to higher crude price yesterday.

At the currency markets on Tuesday, the dollar index rebounded after dropping 0.3% yesterday on speculation borrowing costs may rise later this year. The dollar rose as much as 0.8% against a basket of six major currencies.

In its monthly report issued last week, OPEC lowered its forecast for world oil-demand growth for 2008 to 1.03 million barrels a day, which represents a decline of 70,000 barrels from its previous estimate. Global oil demand this year is expected to average 86.81 million barrels a day. Earlier this month, the Energy Information Administration projected that U.S. petroleum consumption will shrink by 400,000 barrels a day in 2008, 38% more than EIA's June projection of a decline of 290,000 barrels.

Against this backdrop, August reformulated gasoline fell 7 cents, or 2.2%, to $3.15 a gallon, and August heating oil dropped 7 cents, or 1.9%, to $3.68 a gallon.

Natural gas fell to the lowest in more than three months amid forecasts that Tropical Storm Dolly will miss production areas in the Gulf of Mexico. Natural gas for August delivery fell 44.3 cents (4.2%) to settle at $10.067 per million British thermal units.

At the MCX, crude oil for August delivery closed at Rs 5,442/barrel, lower by Rs 157 (2.8%) against previous day’s close. Natural gas for August delivery closed at Rs 430.7/mmbtu, lower by Rs 22.6/mmbtu (5%).

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BSE Bulk Deals to Watch - July 22 2008

Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
22/7/2008 590059 BIHAR TUBES SECUROCROP SECURITIES INDIA P B 42497 163.38
22/7/2008 590059 BIHAR TUBES SECUROCROP SECURITIES INDIA P S 69764 157.26
22/7/2008 523489 CMM HOSPITAL. SHEETAL RAJESH JAIN B 38250 19.16
22/7/2008 532271 CYBERMAT INF S V ENTERPRISES B 2112269 4.83
22/7/2008 532271 CYBERMAT INF S V ENTERPRISES S 2168744 4.71
22/7/2008 532996 FIRST WIN MEENAL NITESH THAKUR B 115482 137.67
22/7/2008 532996 FIRST WIN MERIT CREDIT CORPORATION LTD S 105000 137.95
22/7/2008 532996 FIRST WIN MEENAL NITESH THAKUR S 115482 136.32
22/7/2008 531137 GEMSTONE INV PREM M PARIKH B 28000 22.54
22/7/2008 531137 GEMSTONE INV BHAVESH P PABARI B 28500 22.50
22/7/2008 531137 GEMSTONE INV BHAVESH PRAKASH PABARI S 90000 22.53
22/7/2008 500151 GTC INDUSTRI L AND T FINANCE LIMITED S 173000 104.90
22/7/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD B 84700 21.53
22/7/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD S 98367 20.94
22/7/2008 517522 RAJ GLO WIR MIDEX GLOBAL PVT. LTD. B 25000 91.30
22/7/2008 517522 RAJ GLO WIR SWASTIKA FIN LEASE LTD. S 25000 91.30
22/7/2008 513583 SBT INTERN KAPIL PURI B 300682 13.50
22/7/2008 513583 SBT INTERN CITIGROUP GLOBAL MKTS MAURITIUS PVT LTD S 125000 13.50
22/7/2008 513583 SBT INTERN ABN AMRO BANK NV LONDON S 88264 13.50

NSE Bulk Deals to Watch - July 22 2008

Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
22-JUL-2008,FIRSTWIN,First Winner Industries L,ALPHA CHEMIE TRADE AGENCIES PVT LTD,BUY,93836,136.00,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,CHOKHANI SECURITIES LTD,BUY,91316,134.79,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,DIPAK RAMANBHAI RATHOD,BUY,101076,127.50,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,FIN BRAINS SECURITIES (INDIA) LTD.,BUY,129884,135.31,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,PRASHANT JAYANTILAL PATEL,BUY,245334,138.07,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,S. J. SECURITIES LIMITED,BUY,100000,137.99,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,TRANSGLOBAL SECURITIES LTD.,BUY,313536,135.90,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,YUVAK SHARE TRADING PVT LTD,BUY,191600,135.51,-
22-JUL-2008,IFCI,IFCI Ltd.,AMBIT SECURITIES BROKING PVT. LTD.,BUY,3997910,39.99,-
22-JUL-2008,IFCI,IFCI Ltd.,CLEAN FINANCE & INVESTMENT LTD,BUY,5993807,39.96,-
22-JUL-2008,KHAITANLTD,Khaitan (India) Ltd.,MANOJ CHHAWCHHARIA,BUY,102000,36.14,-
22-JUL-2008,SB&TINTL,SB&T International Ltd,PURI KAPIL,BUY,305713,13.50,-
22-JUL-2008,TFCILTD,Tourism Finance Corp ,NEO SECURITIES LTD.,BUY,555344,14.72,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,ALPHA CHEMIE TRADE AGENCIES PVT LTD,SELL,93836,139.22,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,CHOKHANI SECURITIES LTD,SELL,91326,135.92,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,DIPAK RAMANBHAI RATHOD,SELL,41076,140.09,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,FIN BRAINS SECURITIES (INDIA) LTD.,SELL,129884,135.44,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,MERIT CREDIT CORPORATION LTD,SELL,110000,137.86,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,PRASHANT JAYANTILAL PATEL,SELL,245334,137.65,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,S. J. SECURITIES LIMITED,SELL,125000,135.13,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,SCB CORPORATION PROP SUNIL BAMCHA,SELL,98219,139.64,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,TRANSGLOBAL SECURITIES LTD.,SELL,313536,136.30,-
22-JUL-2008,FIRSTWIN,First Winner Industries L,YUVAK SHARE TRADING PVT LTD,SELL,191569,135.88,-
22-JUL-2008,GTCIND,GTC Industries Ltd,L&T FINANCE LIMITED,SELL,125875,107.34,-
22-JUL-2008,IFCI,IFCI Ltd.,AMBIT SECURITIES BROKING PVT. LTD.,SELL,3982804,40.02,-
22-JUL-2008,IFCI,IFCI Ltd.,CLEAN FINANCE & INVESTMENT LTD,SELL,5993807,39.98,-
22-JUL-2008,JAYAGROGN,Jayant Agro Organics Ltd.,SHASHIKANT BHAI PATEL,SELL,100000,53.43,-
22-JUL-2008,KHAITANLTD,Khaitan (India) Ltd.,CD EQUI FINANCE PVT LTD,SELL,110000,36.14,-
22-JUL-2008,SB&TINTL,SB&T International Ltd,ABN AMRO BANK N.V. LONDON BRANCH,SELL,88264,13.50,-
22-JUL-2008,SB&TINTL,SB&T International Ltd,CITIGROUP GLOBAL MARKETS MAURITIUS PRIVATE LIMITED,SELL,131742,13.50,-
22-JUL-2008,TFCILTD,Tourism Finance Corp ,Copthall Mauritius Investment Ltd,SELL,715000,14.76,-
22-JUL-2008,TFCILTD,Tourism Finance Corp ,NEO SECURITIES LTD.,SELL,50450,14.78,-

Post Session Commentary - July 22 2008

The domestic market continued its rally as it witnessed strong buying support from the sectoral heavy weights as it sensed that vote of confidence would be in favor of UPA so that they will stay as a government. Trust vote is fixed at 6PM today, which will decide that UPA’s continuance as a government or not. Indian market opened on flat note due to the political uncertainty but further it gathered the momentum to trade higher on hopes that the government will last its term. Due to the strong buying support over the counters, market extended its gains to close on a firm note. The BSE Sensex ended above 14,000 level and NSE Nifty closed above 4,200 mark. From the sectoral front, the FMCG and Power indices closed with a gain of more than 4%. Along with this huge buying was seen in Metal, Capital Goods, Bank and Oil & Gas stocks. However, Auto stock was only sufferer of negative sentiment. The market breadth was positive as 1849 stocks closed in green while 734 stocks closed in red and 74 stocks remained unchanged.

The BSE Sensex closed higher by 254.16 points at 14,104.20 and NSE Nifty ended up by 80.60 points at 4,240.10. The BSE Mid Caps closed with gains of 89.04 points at 5,346.03 and Small Cap ended up by 98.44 points 6,536.42. The BSE Sensex touched intraday high of 14,206.13 and intraday low of 13,798.18.

Gainers from the BSE are Reliance Infra (6.83%), Ranbaxy Lab (4.74%), BHEL (6.04%), ITC Ltd (6.00%), Wipro Ltd (5.93%), Cipla Ltd (4.99%), Reliance Com Ltd (4.83%), Tata Steel (4.32%), ACC Ltd (4.08%) and SBI (3.73%).

Lossers from the BSE are Maruti Suzuki (9.29%), JP Associates (4.26%), Bharti Airtel (2.47%), DLF Ltd (2.00%) and Tata Motors (1.94%).

The BSE Metal index closed up by 466.21 points at 12,232.45. Gainers are Sesa Goa Ltd (7.01%), Welspan Gujarat Sr (7.00%), Steel Authority (6.96%), Jindal Steel (6.34%), Tata Steel (4.32%), and Ispat Industries (3.43%).

The BSE Capital Goods index ended up by 343.44 points at 11,406.30. As Jyoti Struct (18.03%), Alstom Proje (7.43%), Areva (6.17%), BHEL (6.04%), Punj Lloyd (5.10%) and Thermax Ltd (4.79%) closed in positive territory.

The BSE Bank index closed higher by 200.27 points at 6,628.98. Major gainers are Kotak Bank (6.97%), Axis Bank (6.09%), Bank of Baroda (5.50%), SBI (3.73%), Union Bank (3.60%), Canara Bank (3.38%), and Indian Overseas Bank (3.22%).

The BSE Power index gained 103.44 points to close at 2,512.68. Major gainers are Reliance Power (7.90%), GVK Power (7.70%), Reliance Infra (6.83%), Tata Power (6.23%), Areva (6.17%) and BHEL (6.04%).

The BSE Oil & Gas index ended up by 73.15 points at 9,382.31. As Reliance Natural Resources (6.83%), Cairn India (4.43%), BPCL (4.40%), Reliance Pet (3.53%) and HPCL (2.71%) closed in positive territory.

The BSE Auto index lost 35.10 points to close at 3,628.06. Major lossers are Maruti Suzuki (9.29%), Bharat Forge (4.02%), Tata Motors (1.94%) and Escorts Ltd (1.92%).

Sensex ends firm above 14,100

The market remained buoyant on strong foreign institutional investor (FII) inflows and the index surged past the 14,200 mark in intra-day trades. Resuming on a negative note at 13,838, 12 points below its previous close of 13,850, Sensex turned positive and crossed the 14,000 mark in the afternoon. A positive close in most of the Asian indices triggered a major rally in heavyweight, fast moving consumer goods (FMCG), power, metal and banking stocks that helped Sensex surge to an intra-day high of 14,206. Sensex finally closed with gains of 254 points at 14,104, while Nifty added 81 points to close at 4,240.

The market breadth was extremely positive. Of the 2,657 stocks traded on the BSE, 1,849 stocks advanced, while only 734 stocks declined; 74 stocks ended unchanged. Among the sectoral indices, BSE FMCG gained 4.35% followed by BSE Power index, which was up 4.29%. BSE Metal index was up 3.96%, BSE Bankex index gained 3.12% and BSE capital goods (CG) index gained 3.10%. BSE public sector unit (PSU) index jumped by 2.50%, BSE information technology (IT) index moved up by 1.89% and BSE consumer durables (CD) index was up 1.66%. BSE TEck index, BSE Oil & Gas index, BSE health care (HC) and BSE Realty index also ended the day in positive. However, BSE Auto index closed in the red, down 0.96%.

Leading the upsurge in Sensex, Reliance Infra soared 6.83% at Rs846. BHEL advanced 6.04% at Rs1597.50, ITC rose 6% at Rs189.90, Wipro advanced 5.93% at Rs394.75, Cipla added 4.99% at Rs237.75, Reliance Communications jumped 4.83% at Rs468.15, Tata Steel gained 4.32% at Rs624.35 and ACC moved up 4.08% at Rs564.50. SBI, M&M, Hindalco, HDFC, ICICI Bank, TCS, L&T, Grasim and HUL also ended the day in positive territory with 2-3% each. However, Maruti Suzuki India dropped 9.29% at Rs587.95, JP Associates was down 4.26% at Rs159.45 while Bharti Airtel, DLF and Tata Motors also ended at lower levels.

On the volume front, over 2.21 crore Reliance Natural Resources Ltd (RNRL) shares changed hands on the BSE followed by IFCI (1.23 crore shares), Reliance Petroleum Ltd (RPL; 0.95 crore shares), Ispat Industries (0.72 crore shares) and JP Associates (0.65 crore shares).

Market gains smartly

The market ended with smart gains for the fourth consecutive session in a row on expectations the Congress-led United Progressive Alliance (UPA) government will win the trust vote in parliament. The market, which had turned volatile in the second half of trading session on account of weak global cues, firmed up in the late trade again on all round buying support. All the sectoral indices on BSE, barring the auto index, ended in green.

As per provisional data released by the stock exchanges after trading hours, foreign funds today, 22 July 2008, sold shares worth a net Rs 597.35 crore. Domestic funds bought shares worth a net Rs 261.61 crore.

Meanwhile, a high drama was witnessed in Lok Sabha today afternoon after market hours when Ashok Argal, a BJP MP from Morena walked into the well with a bag full of currency notes, which he claimed was given by a Samajwadi Party leader in return for his support in the trust vote. Amid the chaos, Deputy Speaker Charanjit Atwal adjourned the House briefly

The government is seeking the trust vote after the Left parties early this month withdrew support to the government. Reports suggest that the government has a wafer-thin edge of winning the trust vote.

Following disruption in Lok Sabha in afternoon, voting on the trust motion was likely to be delayed. Earlier Lok Sabha Speaker Somnath Chatterjee had announced that electronic voting will take place on the trust motion in parliament at 18:00 IST today. A debate on the trust vote is going on in the parliament since yesterday in a special session being held for the purpose.

If the government wins the confidence vote it will continue to be in power. If the government loses the trust vote, the president could ask the prime minister to continue in power as a caretaker government. The Election Commission of India will then fix a date and mid-term polls will be held.

The 30-share BSE Sensex advanced 254.16 points or 1.84% at 14,104.20. The index gained 356 points at day's high of 14,206.13 hit in early afternoon trade. The Sensex shed 51.86 points at day's low of 13,798.18, hit at the onset of trading session.

The broader based S&P CNX Nifty advanced 80.6 points or 1.94% at 4240.10. Nifty July 2008 futures were at 4271.90, at a premium of 31.80 points as compared to spot closing.

The BSE Mid-Cap index was up 1.69% to 5,346.03 and the BSE Small-Cap index was up 1.53% to 6,536.42.

The market breadth was strong on BSE with 1849 shares advancing as compared to 734 that declined. 74 remained unchanged.

BSE clocked a turnover of Rs 5504 crore, higher than Rs 4,408.03 crore on Monday, 21 July 2008. NSE's futures & options (F&O) segment turnover was Rs 54,100.84 crore, which was higher than Rs 43942.21 crore on Monday, 21 July 2008.

The market has witnessed a solid surge ahead of the government's trust vote. Sensex has risen for four consecutive trading sessions ahead of trust vote in the parliament later today. Sensex has risen 1528.4 points or 12.15% in last four trading sessions from its close of 12575.80 on 16 July 2008. The barometer index is down 6182.79 points or 30.47% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 7102.57 points or 33.49% away from its all-time high of 21,206.77 struck on 10 January 2008.

ITC (up 6% at Rs 189.90), Wipro (up 5.93% at Rs 394.75), Cipla (up 4.99% at Rs 237.75), Reliance Communication (up 4.83% at Rs 468.15), and ACC (up 4.08% at Rs 564.50), were the prominent gainers from the Sensex pack today, 22 July 2008.

India’s largest drug maker by sales Ranbaxy Laboratories rose 1.03% at Rs 462.90 after the company said a UK court had quashed the country's Serious Fraud Office's (SFO) prosecution of the firm's subsidiary. Ranbaxy said in a statement the English Crown Court had also declined an application by the SFO for permission to appeal to the English Court of Appeal. However, the SFO retained a right to appeal to the court directly, the Indian firm said.

Jaiprakash Associates (down 4.26% at Rs 159.45), Bharti Airtel (down 2.47% at Rs 778.75), DLF (down 2% at Rs 454.15), and Tata Motors (down 1.94% at Rs 411.90), were the major losers from the Sensex pack.

India's largest passenger carmaker by sales Maruti Suzuki (India) slumped 9.29% to Rs 587.95. Its net profit fell 6.8% to Rs 465.85 on a 20.9% increase in sales to Rs 4753.58 crore in Q1 June 2008 over Q1 June 2007. Maruti declared the results after market hours on Monday, 21 July 2008.

Power sector stocks were in demand. Reliance Power (up 7.90% at Rs 142.75), GVK Power & Infrastructure (up 7.70% at Rs 33.55), Reliance Infrastructure (up 6.83% at Rs 919.30), and Tata Power (up 6.23% at Rs 1,108.65), soared. The BSE Power index outperformed the Sensex, rising 4.29% to 2,512.68.

India's largest power equipment maker by sales Bharat Heavy Electricals (Bhel) rose 6.04% at Rs 1,597.50. Its net profit rose 33.1% to Rs 384.41 crore on a 33.9% increase in sales to Rs 4329.24 crore in Q1 June 2008 over Q1 June 2007. The company's outstanding order book stood at Rs 95,000 crore as on 30 June 2008. Bhel declared results after market hours on Monday, 21 July 2008.

Electrical equipment maker Areva T&D jumped 6.17% to Rs 1,617.15 after the company said its board will meet on 29 July 2008 to consider a 5-for-1 stock split.

Metal shares rose. Sesa Goa (up 7.01% at Rs 2,878.35), Welspun Gujarat Stahl Rohren (up 7% at Rs 314.15), Jindal Steel & Power (up 6.34% at Rs 1,862.90), and Ispat Industries (up 3.43% at Rs 22.60), soared. The BSE Metal index outperformed the Sensex, rising 3.96% to 12,232.45.

World’s sixth largest steel maker Tata Steel rose 4.32% at Rs 624.35 after its Thailand unit reported a surge in quarterly net profit and on expectations for a domestic price rise.

India's largest state-run steel maker by output Steel Authority of India (Sail) rose for the second day in a row after it reported good Q1 results during trading hours yesterday, 21 July 2008. The stock rose 6.96% to Rs 134.40. Sail's net profit rose 20.3% to Rs 1835.19 crore on a 37.2% increase in sales to Rs 11029.44 crore in Q1 June 2008 over Q1 June 2007.

Banking shares moved up. Kotak Mahindra bank (up 6.97% at Rs 510.15), Axis Bank (up 6.09% at Rs 740.05), and Bank of Baroda (up 5.50% at Rs 243.65), spurted. The BSE Bankex outperformed the Sensex, rising 3.12% to 6,628.98.

India's largest private sector bank by assets ICICI Bank rose 2.67% to Rs 661.30. The stock hit an intra-day high of Rs 677.80 earlier in the day.

India's largest private sector firm by market capitalization and oil refiner Reliance Industries was almost unchanged at Rs 2154.30. Bombay High Court has reportedly adjourned a hearing on the dispute over the gas supply agreement between Reliance Industries of Mukesh Ambani (RIL) and Reliance Natural Resources (RNRL) of Anil Ambani, to Wednesday, 23 July 2008.

For RNRL, the availability and pricing of gas from RIL's Krishna-Godavari basin is critical for the success of its proposed 7,500 megawatt power plant in Dadri. RIL, on the other hand, wants court approval so that it can enter into contracts with third parties for the sale of gas as production from the KG basin draws near.

India’s second largest software exporter by sales Infosys Technologies rose 1.10% at Rs 1578.95.

Power generation equipment maker Thermax rose 4.79% at Rs 401.05 after the company, during market hours today, reported 13.72% rise in net profit to Rs 63.70 crore on a 7.56% increase in sales to Rs 7,16.97 crore in Q1 June 2008 over Q1 June 2007.

State-run mortgage lender LIC Housing Finance rose 1.90% to Rs 262.25 on reports it is set to foray into the venture capital arena and intends to start a Rs 500 crore real estate fund by the end of this financial year.

Drug maker Lupin gained 4.22% to Rs 726.75 on reporting 38.45% rise in net profit to Rs 108.52 on 18.39% rise in total income to Rs 712.42 crore in Q1 June 2008 over Q1 June 2007.

Toys maker Hanung Toys & Textiles gained 0.72% to Rs 190 after posting 101% rise in net profit to Rs 18.69 crore on a 71.4% rise in sales to Rs 146.04 crore in Q1 June 2008 over Q1 June 2007.

Offshore services provider Aban Offshore declined 3.41% to Rs 2,568.40 on concerns of equity dilution after the company said it plans of raise funds through various routes.

Reliance Capital reported the highest turnover of Rs 424.32 crore on BSE. Reliance Infrastructure (Rs 254.36 crore), Reliance Industries (Rs 218.07 crore), Larsen & Toubro (Rs 160.86 crore) and Reliance Natural Resources (Rs 160.10 crore), were the other turnover toppers on BSE in that order.

Reliance Natural Resources clocked a highest volume of 2.21 crore shares on BSE. IDFC (1.23 crore shares), IFCI (1.20 crore shares), Reliance Petroleum (95.29 lakh shares), and Ispat Industries (72.31 lakh shares), were the other volume toppers on BSE in that order.

European markets, which opened after Indian market, were in red. Key indices in UK, France and Germany were down 0.68% to 1.44%. European markets tumbled after a worse-than-forecast profit fall from Ericsson and a revenue warning from Vodafone spooked investors.

Asian markets, which were subdued earlier in the day, pared losses as the trading session proceeded. Key indices in China, Hong Kong, Singapore, South Korea and Taiwan were down by 0.02% to 0.93%. However, key index in Japan was up 2.98%. The Asian indices had fallen earlier as several major US companies, including American Express Co, iPod maker Apple Inc and cruise ship operator Royal Caribbean Cruises, disappointed investors with lower-than-expected quarterly results on Monday, 21 July 2008.

US stocks finished lower on Monday, 21 July 2008. The Dow Jones Industrial Average lost 29.23 points or 0.25% at 11,467.34. The tech-laden Nasdaq Composite Index lost 3.25 points or 0.14% at 2,279.53.

Caution to prevail ahead of trust vote

Caution is likely to prevail on the bourses ahead of the government’s trust vote in parliament today, 22 July 2008. The government is seeking a vote of confidence in parliament in a special two-day session that began yesterday, 21 July 2008, after it was reduced to minority following withdrawal of support of Left parties early this month.

Trading volumes are likely to remain low as institutional investors will remain on the sidelines ahead of the outcome of the confidence vote. As per reports, the actual voting will take place at between 17:00 IST to 18:00 IST, which is after trading hours. Reports suggest that the government has a wafer-thin edge of winning the trust vote.

If the government wins the confidence vote it will continue to be in power. If the government loses the trust vote, the president could ask the prime minister to continue in power as a caretaker government. The Election Commission of India will then fix a date and mid-term polls will be held. Another possibility in case the government loses the trust vote is that the opposition may try to form an interim government before the scheduled May 2009 election. However, this is an unlikely scenario given that the Bharatiya Janata Party (BJP) has said it would prefer elections if the government falls.

A section of the market reckons that the government may push forward economic reforms if it survives the vote of confidence in parliament. There has been a virtual halt in reforms process in the last four years due to strong opposition to reforms from Left parties. Left parities had stalled privatisation of state-run firms, pension reforms, higher foreign limits in insurance and more liberal norms for foreign bank

Asian stocks were subdued today, 22 July 2008, as several major US companies, including American Express Co, iPod maker Apple Inc and cruise ship operator Royal Caribbean Cruises, disappointed investors with lower-than-expected quarterly results on Monday, 21 July 2008. Key benchmark indices in Hong Kong, China, South Korea, Singapore and Taiwan were down by between 0.1% to 0.7%. The Japanese market bucked the weak trend. The Nikkei 225 average was up 1.4%.

US stocks finished lower on Monday, 21 July 2008. The Dow Jones Industrial Average lost 29.23 points or 0.25% at 11,467.34. The tech-laden Nasdaq Composite Index lost 3.25 points or 0.14% at 2,279.53.

As per provisional data released by the stock exchanges, foreign funds on Monday, 21 July 2008, sold shares worth a net Rs 62.22 crore. Foreign funds purchased worth a net Rs 589.20 crore on Friday, 1 July 2008, data released by market regulator Securities & Exchange Board of India (Sebi) after trading hours on Monday, 21 July 2008, showed.

Meanwhile, a cause for concern on the inflation front is the uneven distribution of rains in this monsoon season so far which has raised concerns about some kharif crops. Though the Indian Meteorological Department (IMD) has estimated the cumulative monsoon rainfall till 15 July 18, 2008, at 6% above normal, rains have been scanty in southern peninsula, Maharashtra and parts of Gujarat and Rajasthan.

With inflation hovering at highest level in more that 13 years, the Reserve Bank of India (RBI) is expected to further tighten the monetary policy at its quarterly monetary policy review next week.

Crude oil rose more than $2 a barrel to $131.04 on Monday, 21 July 2008. Oil's rise came on the heels of its biggest weekly decline ever.

Petronet LNG, Shree Cements, LIC Housing Finance, BHEL, Voltas

Petronet LNG, Shree Cements, LIC Housing Finance, BHEL, Voltas

Daily Call - July 22 2008

The markets continued to strengthen for the third day on Monday as bulls showed no sign of easing their strangle hold on the bears. The fact that the Nifty Futures were traded at a premium of 6 points indicates that the shorts were covered. Also in stock futures we lost 1.5 cr shares of OI which indicates that profits have been booked in positions built over the past days.



The FIIs have turned buyers again in Index futures. Crude is marginally up but will not affect the sentiment. Sentiment was poor in the US as Apple, Texas Instruments and American Express were marked down by at least 10% each with the Nasdaq After Hours Indicator registering a 45 points fall, the largest we have seen in recent history. However, as our markets re-open tomorrow, they will be guided by the outcome of the trust vote and not how US fairs tonight. As you are already hedged, there is nothing more you need to do but twiddle your thumbs. If a large number of MPs fail to turn up there is possibility that the markets could sense which way the wind will blow before the vote.

Morning Call - July 22 2008

Market Grape Wine :

In House :

Nifty at a support at 4095 and 4030 with resistance 4183 and 4220 levels.

Cash: sell ICICI BANK below 621 target 590 with S/L 632

Cash: sell TATAPOWER below 1010 target 980with S/L 1025

Future: Sell BPCL below 280 target 265 with S/L 287

Future : Buy TISCO above 610 target 635 with S/L 600




Out House:

Markets at a support of 13654 & 13452 levls with resistance at 13993 & 14041 levels .

Buy : Relcap & Adlabs

Buy : RIL

Buy : ITC

Buy : LT

Buy : ACC & Grasim at dips

Buy : SBIN & IciciBank

Buy : JPasso

Buy : PFC & NTPC

Buy : GujNRE at dips

Dark Horse : Suzlon , LNT , RIL , ITC ,Core , NTPC & Tisco

Pre Session Commentary - July 22 2008

The Indian Market is expected to have negative opening on the back of unfavorable global cues as US market ended lower and Asian markets are trading mixed. On Monday, the Indian market closed with gains after going through little volatility during the trading session. The domestic market yesterday opened on firm note, tracking strong cues from the Asian markets. Further, market trimmed its initial gains as investors were taking calculative steps on political worries but later managed to gather and maintain the higher momentum to close with good gains. The BSE Sensex ended above 13,800 mark and NSE Nifty closed above 4,100 level. From the sectoral front, the Bank and Pharma indices closed with a gain of more than 3%. Along with this Reality, Metal and Oil & Gas stocks also witnessed buying interest. However, Capital Goods and Consumer Durables stocks were major sufferers of negative sentiment. The BSE Sensex closed higher by 214.64 points at 13,850.04 and NSE Nifty ended up by 67.25 points at 4,159.50.

We expect that market may remain volatile during the trading session and crucial trust vote will set direction for the market. There will be vote of confidence in parliament today, which will decide UPA’s continuation as a government.

On Monday, the US market was closed in red as oil turned higher after a sharp drop last week by more than $2 to above $US131 a barrel. An announcement by Bank of America also added to negative sentiment about its second-quarter profit of $3.4 billion to $1 billion, down 41% from previous year.

The NASDAQ ended lower by 29.23 points at 11,467.34, followed by the Dow Jones Industrial Average (DJIA) closed lower by 3.25 points at 2,279.53 along with S&P 500 ended down by 0.68 points at 1,260.00.

Indian ADRs ended down. In technology sector, Satyam ended down by (5.22%) along with Wipro closed down by (3.05%), Infosys by (2.45%) and Patni Computers dropped by (2.13%). In banking sector, HDFC bank gained by (1.66%) while ICICI bank lost (0.13%). In telecommunication sector, Tata Communication ended up by (0.10%) and MTNL ended down by (0.44%). Sterlite industries increased by (3.59%).

Today the major stock markets in Asia are trading mixed Japan’s Nikkei is trading higher by 165.31 points at 12,969.01 while Hang Seng index trading down by 24.36 points at 22,508.54 and Taiwan Weighted trading at 7,071.49 dropped by 14.18 points.






The FIIs on Monday stood as net buyer in equity. The gross equity purchased was Rs2,988.40 Crore and the gross debt purchased was Rs0.00 Crore while the gross equity sold stood at Rs2,399.20 Crore and gross debt sold stood at Rs0.00 Crore. Therefore, the net investment of equity reported was Rs589.20 Crore and net debt was Rs0.00 Crore.

Today, Nifty has support at 4,081 and resistance at 4,221 and BSE Sensex has support at 13,576 and resistance at 14,106.

Market may remain volatile

The market is moving in tune with international markets for last few sessions. The local indices may witness volatility following the overnight gains in the European markets and major Asian gauges like the Nikkei, the Hang Seng index, the Straits Times Index and the Jakarta index are trading in mixed territory in current trades. Although the domestic indices moved up on Monday, intra-day volatility remains the major concern. Among the local indices, the Nifty could test higher levels around the 4215 level and has a support at 4100. The Sensex on the downside may slip to 13700 and may face resistance at 14055.

In the US markets, the broader Dow Jones was down by 29 points at 11467 and the Nasdaq was lost three points to close at 2280.

Indian ADR's had a mixed outing on the US bourses. Satyam was the major loser and tanked 5.22% while Dr Reddy, Wipro and Infosys slumped over 2-4% each. ICICI Bank and MTNL ended with steady loss However, Rediff jumped by 4.58% and Patni Computer surged over 2.13% while HDFC Bank, Tata Motors andVSNL ended with the marginal gains.

Crude oil prices gained marginally, with the Nymex light crude oil for August delivery moved up by $2.16 to close at $131.04 a barrel. In the commodity space, the Comex gold for August series gained $5.70 to settle at $963.70 a troy ounce.