Weekly Wrap - Sep 5 2008
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Friday, September 05, 2008
BSE Bulk Deals to Watch - Sep 5 2008
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
5/9/2008 506074 ARSHIYA INTL ARCHANA AJAY MITTAL B 310656 165.00
5/9/2008 506074 ARSHIYA INTL CARLSON FUND EQ ASIAN SMALL CAP B 500000 165.00
5/9/2008 506074 ARSHIYA INTL SWISS FINANCE CORPORATION MAURITIUS LTD S 392592 165.00
5/9/2008 530355 ASIAN OILFIE DECENT FIN SER P LTD S 100000 121.00
5/9/2008 519532 ASIAN TEA EX ENCA FINLEASE LTD. S 50000 53.60
5/9/2008 533016 AUSTRAL COKE EUREKA STOCK AND SHARE BROKING SERVICES LIMITED B 158201 212.43
5/9/2008 533016 AUSTRAL COKE OPG SECURITIES PVT LTD B 1122513 213.00
5/9/2008 533016 AUSTRAL COKE M D KOTECHA B 171208 205.04
5/9/2008 533016 AUSTRAL COKE EUREKA STOCK AND SHARE BROKING SERVICES LIMITED S 158201 212.57
5/9/2008 533016 AUSTRAL COKE OPG SECURITIES PVT LTD S 1122513 213.13
5/9/2008 533016 AUSTRAL COKE M D KOTECHA S 171208 200.80
5/9/2008 505506 AXON INFOTEC RAHUL DOSHI S 4470 22.04
5/9/2008 590059 BIHAR TUBES MUKESH JAIN B 35756 200.98
5/9/2008 517973 DMC INTER J.A FINANCIAL AND MANAGEMENT CONSULTANTS PVT LTD B 21248 8.00
5/9/2008 517973 DMC INTER J.A FINANCIAL AND MANAGEMENT CONSULTANTS PVT LTD S 21248 8.09
5/9/2008 531367 DOLLEX INDUT IMMORTAL FINANCIAL SERV P LTD B 65000 15.46
5/9/2008 531367 DOLLEX INDUT YUSUF KHAN S 65000 15.44
5/9/2008 532751 EASUNREYRL HERITAGE ASSET MGT INC AC INDIA EMERGING OPP FUND LTD B 121000 104.25
5/9/2008 513059 G.S. AUTO VIJAY KUMAR GOYAL B 30418 78.84
5/9/2008 513059 G.S. AUTO SPJSTOCK S 27702 78.00
5/9/2008 531439 GOLDSTON TEC MASUMI OVERSEAS PVT LTD S 150000 114.78
5/9/2008 532326 INTENS TECH CITIGROUP GLOBAL MARKETS MAURITIUS PVT LTD S 178797 17.82
5/9/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD B 438084 33.12
5/9/2008 531602 KOFF BR PICT HITESH SHASHIKANT ZAVERI B 59518 33.69
5/9/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD S 401210 32.44
5/9/2008 531602 KOFF BR PICT HITESH SHASHIKANT ZAVERI S 54794 33.10
5/9/2008 533015 NUTEK INDIA OPG SECURITIES PVT LTD B 311925 188.99
5/9/2008 533015 NUTEK INDIA OPG SECURITIES PVT LTD S 311925 189.22
5/9/2008 517195 ORG INFORMAT DEUTSCHE BANK AG LONDON GDR AC S 90000 29.47
5/9/2008 524820 PANAM PETROC SUDHIR JAIN S 55760 132.65
5/9/2008 532886 SEL MANUF MBL AND COMPANY LIMITED B 104753 261.35
5/9/2008 532886 SEL MANUF HARDIK M MITHANI B 202406 263.63
5/9/2008 532886 SEL MANUF MARWADI SHARES AND FINANCE LIMITED B 78797 262.41
5/9/2008 532886 SEL MANUF OPG SECURITIES PVT LTD B 257412 256.10
5/9/2008 532886 SEL MANUF SPJSTOCK B 435716 261.84
5/9/2008 532886 SEL MANUF B K SHAH CO B 208049 257.92
5/9/2008 532886 SEL MANUF MBL AND COMPANY LIMITED S 104753 262.08
5/9/2008 532886 SEL MANUF HARDIK M MITHANI S 202406 258.70
5/9/2008 532886 SEL MANUF MARWADI SHARES AND FINANCE LIMITED S 78797 262.45
5/9/2008 532886 SEL MANUF OPG SECURITIES PVT LTD S 257412 256.07
5/9/2008 532886 SEL MANUF SPJSTOCK S 435716 262.43
5/9/2008 532886 SEL MANUF B K SHAH CO S 201811 258.04
5/9/2008 532886 SEL MANUF NIRMAL NARENDRA KOTECHA S 76500 265.64
5/9/2008 532765 USHER AGRO MANHARLAL NAROTTAMDAS SHAH B 160753 137.92
5/9/2008 532765 USHER AGRO MANHARLAL NAROTTAMDAS SHAH S 160753 142.28
5/9/2008 530595 VICTORY PROJ YUVAK SHARE TRADING PVT LTD S 46956 26.32
5/9/2008 532360 VINTAGE CARD MANSUKH SECURITIES AND FINANCE LTD B 4542 113.48
5/9/2008 532360 VINTAGE CARD PRINCE GUPTA B 5083 113.79
5/9/2008 532360 VINTAGE CARD MANSUKH SECURITIES AND FINANCE LTD S 3233 113.77
5/9/2008 532360 VINTAGE CARD PRINCE GUPTA S 5083 114.06
MidcapMania Multibaggers - Gremach Infrastructure Equipments
Investors can take this as Buy Call. We can see multifold returns in this counter. GIEPL’s foray into oil rigs holds immense potential.
CMP: 81
Year High: 504
Year Low: 72
PE: 3.2
EPS: 24.43 (March 08)
Expected EPS: 30 (FY 09)
Sales: 102.36 Crores (June 08)
Equity MCAP: 127.76
Return on average equity: 35%
Debt/equity: 0.6
Net Operating Income per share: Rs 135 (March 07)… amazing
Some Key factors that are favoring gremach to become a money machine:
Drilling rigs - Addition of four onshore drilling rigs with plans to add 36 more in three-four years.
Coal Mines & Equiment Rentals - Acquisition of controlling stake in coal mines in Mozambique and the booming market for equipment rentals suggest good earnings prospects. There is a global shortage and crisis of hard coking coal and this will add huge value to the profitability of the Company.
Demand-supply mismatch - A demand-supply mismatches resulting in rising oil rig rentals. Rising rentals and better utilization levels have shrunk the average payback period for oil rigs.
NEPL - The increasing number of onshore blocks in each and every phase of the New Exploration License Program (NEPL) points to strong demand prospects. Drilling costs account for 20-25 per cent of the cost of developing an oil well and are showing an increasing trend in the earnings of company.
Great factor to consider:
MOU - Gremach has signed a MOU (memorandum of understanding) with Baoji Oilfield Machinery (BOMCO), subsidiary of China National Petroleum Corp for the delivery of 40 rigs, which includes 36 onshore and four offshore rigs.
Infra-Equipment business - Rose exponentially! The rental business of infra equipment has risen exponentially on the back of firm demand.
Entering into Coal Business - Gremach has taken a 75 per cent controlling stake in 11 coal mines in Mozambique. This region falls in the Karoo basin, which is recognized as a prime hard coking coal area in Africa. Gremach has incorporated a Singapore based SPV named Petrogrema Energy Pte Ltd. Gremach shall be making an investment of up to USD One Billion considering the vast global market potential in oil drilling business (subject to requisite RBI approval). This business proposal is considered highly profitable, with projected IRR 35% in the light of huge market demand for on shore and off shore drilling rigs considering unprecedented rise in crude prices. Infact, rig rental day rates for Off-Shore Rigs have risen by 13%, averaging to around $ 3 to 5 lacs per day. In the case of on shore rigs the payback period is estimated at 3 years. Several reputed Banks and other financial institutions have evinced keen interest to fund the above business Proposal / Acquisition.
The Financial Data - Impressive! Net Sales of gremach have grown from 347.38 million in quarter June,07 to 1023.62 million in quarter June, 08. Net profit has risen from 40.55 million in quarter June,07 to 121.31 million in quarter June,08. EPS for the same period has jumped from Rs. 2.66 to Rs. 7.97 in the current quarter. Sequentially, the EPS has grown from Rs. 6.16 in quarter March, 08 to Rs. 7.97 in quarter June,08. Net Profit margin has also gone up both sequentially as well as quarter on quarter.
Year High: Rs 504
Current CMP: 86
See its Client List…….. Very impressive
Larsen and Toubro Ltd.
VRCL Infrastructure & Projects Ltd
Gammon
JMC Projects Ltd.
Punj Lyod
LG E & CD – NCC JV
ACC Ltd.
Reliance Eng. Assoc. Pvt.
Madhucon Projects
Nagarjuna Constructions Ltd
Hindustan Cons. Co. Ltd.
Simplex Infrastructure Ltd.
Grasim
UP State Bridge Corp. Ltd.
IRCON International Ltd. (Govt.)
Afcons
The most esteemed infra players are the clients of Gremach. Really impressive clientele list.
Shareholding pattern : Good
A. Promoters: 55.68%
B. FII/MF/Banks: 16.36%
C. Total Public (including B): 44.32%
Risks: Delay in delivery of rigs or drilling projects. Downfall in rigs rental.
Conclusion: This counter can be bought for long term for multifold returns.
By: Uttam Saraf
Disclaimer: DP is not responsible for recommendations posted on this site
Sensex down 415 pts, closes at 4,352.30
Markets saw the biggest fall in nearly two weeks with the benchmark Sensex dropping over 415 points on selling by funds in heavyweight stocks, particularly in refinery, bank and metal segments, on renewed concerns of sluggish global economic growth.
The barometer, which was down by over 150 points in the previous day's trading, today declined sharply by 415.27 points to 14,483.83
The previous biggest loss for the 30-share index was on August 21 when it lost 435 points.
The wide-based National Stock Exchange index Nifty also closed lower by 95.45 points at 4,352.30.
In global markets, the S&P 500 yesterday dropped 3 per cent after the number of people staying on jobless rolls rose to the highest since November 2003.
Marketmen said fears of sluggish growth in US economy hit the software exporting companies like Infosys Technologies. IT sector index closed down by 143.96 points at 3,941.74.
Infosys, country's second-largest software exporter, fell 4.26 percent, the most in three weeks. Wipro, another IT major, dropped 4.8 percent. Satyam Computers also declined by 3.8 percent and Aptech 5.8 percent.
Indian software companies get more than half their sales from the US markets.
NSE Bulk Deals to Watch - Sep 5 2008
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
05-SEP-2008,ALEMBICLTD,Alembic Limited,RELIANCE CAPITAL TRUSTEE CO. LTD. A/C RELIANCE GROWTH FUND,BUY,2018603,42.00,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,AMBIT SECURITIES BROKING PVT. LTD.,BUY,311463,209.08,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD,BUY,199558,208.81,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,CHOKHANI SECURITIES LTD,BUY,156044,207.88,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,DINESH MUNJAL,BUY,221208,206.36,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,FIN BRAINS SECURITIES (INDIA) LTD.,BUY,166822,212.20,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,KAUSHIK SHAH SHARES & SECURITIES PVT LTD,BUY,344419,212.99,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,MANIPUT INVESTMENTS PVT LTD,BUY,198614,213.93,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,NIRMAL N KOTECHA,BUY,158946,204.68,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,NISSAR BROTHERS,BUY,170230,209.56,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,R HEMA KUMARI,BUY,168000,215.27,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,R.M. SHARE TRADING PVT LTD,BUY,326232,210.34,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,TRANSGLOBAL SECURITIES LTD.,BUY,279519,212.08,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,YES INVESTMENTS VISHAL KISHORE BHATIA,BUY,155000,205.52,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,YUVAK SHARE TRADING PVT LTD,BUY,302555,208.36,-
05-SEP-2008,GMRFER,GMR Ferro Alloys & Indust,WALLFORT SHARES & STOCK BROKERS LTD,BUY,100000,63.00,-
05-SEP-2008,IFBIND,IFB Industries Ltd.,WALLFORT SHARES & STOCK BROKERS LTD,BUY,115000,37.50,-
05-SEP-2008,MANALU,Man Aluminium Limited,NIKHIL RAMESHCHANDRA MANSUKHANI ,BUY,26422,32.29,-
05-SEP-2008,NUTEK,Nu Tek India Limited,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD,BUY,96632,195.31,-
05-SEP-2008,NUTEK,Nu Tek India Limited,HEMENDRABAHI RIGHAVCHAND SHAH,BUY,100000,179.99,-
05-SEP-2008,NUTEK,Nu Tek India Limited,TRANSGLOBAL SECURITIES LTD.,BUY,151059,193.12,-
05-SEP-2008,NUTEK,Nu Tek India Limited,YOKE SECURITIES LIMITED,BUY,101031,194.95,-
05-SEP-2008,NUTEK,Nu Tek India Limited,YUVAK SHARE TRADING PVT LTD,BUY,93333,185.25,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,B K SHAH CO KETAN BHAILAL SHAH,BUY,247130,258.99,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,HARDIK M MITHANI,BUY,400401,257.40,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,KOTECHA NIRMAL NARENDRA,BUY,3951,260.64,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,MARWADI SHARES AND FINANCE LIMITED,BUY,89115,261.89,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,MBL & COMPANY LTD.,BUY,131624,260.09,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,URJA INVESTMENT PVT. LTD.,BUY,114783,261.08,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,YUVAK SHARE TRADING PVT LTD,BUY,105194,257.40,-
05-SEP-2008,SICAGEN,Sicagen India Limited,WISDOM ADVISORS PRIVATE LIMITE,BUY,3116310,12.95,-
05-SEP-2008,SINTEX,Sintex Industries Ltd.,RELIANCE MUTUAL FUND,BUY,1352000,311.00,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,KAMAL KUMAR KABRA,BUY,4000,114.10,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,MANSUKH SECURITIES & FINANCE LTD,BUY,5006,114.18,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,N RAVI KUMAR,BUY,3167,115.04,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,PASHUPATI CAPITAL SERVICES PVT. LTD.,BUY,3509,113.96,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,SHREE RIDDHI SIDDHI INVESTMENTS,BUY,3700,114.70,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,VINOD KUMAR AGARWAL,BUY,4000,114.56,-
05-SEP-2008,ALEMBICLTD,Alembic Limited,MERRILL LYNCH INTERNATIONAL,SELL,2045929,42.00,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,AMBIT SECURITIES BROKING PVT. LTD.,SELL,311463,209.29,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD,SELL,199558,208.70,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,CHOKHANI SECURITIES LTD,SELL,156044,207.69,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,DINESH MUNJAL,SELL,221208,206.21,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,FIN BRAINS SECURITIES (INDIA) LTD.,SELL,166822,212.54,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,KAUSHIK SHAH SHARES & SECURITIES PVT LTD,SELL,344419,213.05,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,MANIPUT INVESTMENTS PVT LTD,SELL,198614,214.12,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,NIRMAL N KOTECHA,SELL,163946,200.80,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,NISSAR BROTHERS,SELL,170230,209.46,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,R HEMA KUMARI,SELL,168000,210.15,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,R.M. SHARE TRADING PVT LTD,SELL,326232,210.92,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,TRANSGLOBAL SECURITIES LTD.,SELL,279519,212.81,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,YES INVESTMENTS VISHAL KISHORE BHATIA,SELL,155000,211.22,-
05-SEP-2008,AUSTRAL,Austral Coke & Projects L,YUVAK SHARE TRADING PVT LTD,SELL,303156,208.65,-
05-SEP-2008,GMRFER,GMR Ferro Alloys & Indust,WALLFORT FINANCIAL SERVICES LTD,SELL,100000,63.00,-
05-SEP-2008,GOLDTECH,Goldstone Tech Ltd.,MASUMI OVERSEAS PVT LTD,SELL,100000,114.62,-
05-SEP-2008,IFBIND,IFB Industries Ltd.,WALLFORT FINANCIAL SERVICES LTD,SELL,115000,37.50,-
05-SEP-2008,NUTEK,Nu Tek India Limited,ADITYA S SHAH,SELL,140211,180.86,-
05-SEP-2008,NUTEK,Nu Tek India Limited,ASIT C MEHTA INVESTMENT INTERRMEDIATES LTD,SELL,96632,197.22,-
05-SEP-2008,NUTEK,Nu Tek India Limited,HEMENDRABAHI RIGHAVCHAND SHAH,SELL,14560,181.00,-
05-SEP-2008,NUTEK,Nu Tek India Limited,TRANSGLOBAL SECURITIES LTD.,SELL,150549,193.49,-
05-SEP-2008,NUTEK,Nu Tek India Limited,YOKE SECURITIES LIMITED,SELL,101031,195.32,-
05-SEP-2008,NUTEK,Nu Tek India Limited,YUVAK SHARE TRADING PVT LTD,SELL,92995,185.55,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,B K SHAH CO KETAN BHAILAL SHAH,SELL,247125,258.19,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,HARDIK M MITHANI,SELL,392901,263.91,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,KOTECHA NIRMAL NARENDRA,SELL,78951,260.77,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,MARWADI SHARES AND FINANCE LIMITED,SELL,89113,261.45,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,MBL & COMPANY LTD.,SELL,131624,259.65,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,URJA INVESTMENT PVT. LTD.,SELL,111253,260.19,-
05-SEP-2008,SELMCL,SEL Manufacturing Company,YUVAK SHARE TRADING PVT LTD,SELL,105176,257.50,-
05-SEP-2008,SICAGEN,Sicagen India Limited,IDFC INFRASTRUCTURE FUND 2,SELL,3116310,12.95,-
05-SEP-2008,SINTEX,Sintex Industries Ltd.,CAPITAL RESEARCH & MANAGEMENT COMPANY A/C NEW WORLD FUND INC,SELL,1364694,311.02,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,KAMAL KUMAR KABRA,SELL,1000,115.00,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,MANSUKH SECURITIES & FINANCE LTD,SELL,5006,114.14,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,N RAVI KUMAR,SELL,3287,114.80,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,PASHUPATI CAPITAL SERVICES PVT. LTD.,SELL,3509,114.24,-
05-SEP-2008,VINCARDS,Vintage Cards & Creations,SHREE RIDDHI SIDDHI INVESTMENTS,SELL,731,113.68,-
Post Session Commentary - Sep 5 2008
The Indian market slipped further for the second straight day to close deeper into red. Market shed more than 2% on growing worries about health of global economy as jobless claims increased in the US along with investors’ concern over further development in Indo-US nuclear deal in the NSG meet in Vienna. Weekly jobless claims for US climbed 15,000 to 444,000. Investors also kept an eye on the progress of the Indo-US nuclear deal in the NSG two days meet in Vienna. Domestic markets opened on weak note on sharp negative cues from the global markets. Further, market continued to remain under pressure though struggled to find support. Fresh bouts of selling again crushed markets to end with sharp losses. NSE Nifty ended below 4,300 mark and BSE Sensex closed below 14,500 level. From the sectoral front, Reality index was worst performer as ended with a deep cut of more than 4%.Apart from that, Metal, Bank, Capital Goods, Oil & Gas and IT stocks also took huge beating on the bourses. However, FMCG stocks were ended with margin gain. The market breadth was negative as 1011 stocks closed in green while 1626 stocks were ended in red and 91 stocks remained unchanged in BSE.
The BSE Sensex closed lower by 415.27 points at 14,483.83 and NSE Nifty ended down by 95.45 points at 4,352.30. The BSE Mid Caps and Small Caps ended with losses of 75.45 points and 69.15 points at 5,753.72 and 6,905.22. The BSE Sensex touched intraday high of 14,601.39 and intraday low of 14,438.59.
Losers from the BSE are Ranbaxy Lab (8.77%), ONGC Ltd (2.97%), HDFC (5.78%), DLF Ltd (5.41%), JP Associates (5.23%), Wipro Ltd (4.88%), ICICI Bank Ltd (4.33%), HDFC Bank Ltd (4.33%) and Infosys Tech (4.26%).
The BSE Metal index plunged 397.13 points to close at 11,785.77. Losers are Gujarat NRE Coke (5.41%), Jindal Steel (5.13%), NMDC Ltd (4.82%), Sterlite Indus (4.13%), Tata Steel (3.64%) and Steel Authority (2.92%).
The BSE Bank index ended down by 261.88 points at 7,172.85. As Axis Bank (6.58%), Kotak Bank (5.45%), HDFC Bank Ltd (4.33%), ICICI Bank Ltd (4.33%), Bank of India (3.26%) and Punjab National Bank (3.05%) closed in negative territory.
The BSE Reality index dropped 216.46 points to close at 4,979.26. As Akruti City (6.51%), DLF Ltd (5.41%), Unitech Ltd (4.78%), Penland Ltd (3.92%), Mahindra Life (3.84%) and Indiabull Real (3.70%) ended in negative territory.
The BSE Capital Goods index lost 207.58 points to close at 11,980.60. Losers are Crompton Greaves (4.44%), Reliance industrial Infra (2.98%), Punj Lloyd (2.68%), Elecon Eng C (2.14%), Lakshmi Ma W (2.13%) and L&T Ltd (2.08%)
The BSE Oil & Gas index closed lower by 191.97 points at 9,652.68. Major losers are Essar Oil Ltd (7.18%), Reliance (3.40%), Cairn India (3.36%), Reliance Natural Resources (1.37%) and Gail India (1.02%).
The BSE IT index closed down by 143.96 points at 3,941.74. Major losers are Aptech Ltd (5.89%), Wipro Ltd (4.88%), Moser Bayer (4.39%), Rolta India (4.28%), Infosys Tech (4.26%) and Satyam Computer (3.85%).
Political concerns, weak global equities may weigh on domestic bourses
The market on Monday, 8 September 2008, will react to the outcome of the two-day meeting of the Nuclear Suppliers Group (NSG) in Vienna on the Indo-US nuclear deal. The two-day NSG meet ends on Friday, 5 September 2008. The market will also react to a crucial US job data due on Friday, 5 September 2008, after Indian markets closed. A sharp slide in global crude oil prices and reports of a satisfactory distribution of monsoon bodes well for equities. But a latest controversy on the Indo-US nuclear deal may cause political worries which may weigh on the bourses in the near term.
A softening of inflation for a second consecutive week has raised hopes that we may in the last lap of the interest rate hike cycle. Annual inflation rose 12.34% in the year through 23 August 2008, lower than previous week’s 12.40% rise, data released by the government after trading hours on Thursday, 4 September 2008 showed. Food prices for staples like lentils and vegetables eased while fuel prices remained flat, the data showed.
Inflation, however, remains far above central bank’s target level of 7% towards the year ending March 2009. According to domestic brokerage Edelweiss Securities it is too early to call a softening in inflation this month as a trend because manufactured products inflation is still on the rise.
The sharp fall in oil prices from a record high of $147.27 a barrel struck on 11 July 2008 augurs well for the global economy. Oil settled at $107.89 a barrel on Thursday, 4 September 2008, the lowest level in five months. The sharp fall in oil prices will help reduce inflation worries.
A key near term trigger for oil price is a meeting of the Organization of Petroleum Exporting Countries (Opec) in Vienna on Tuesday, 9 September 2008. The cartel will decide whether to cut production at today’s elevated levels or leave it unchanged. Opec’s 13 members account for about 40% of the world’s oil production
However, political worries may weigh on the domestic bourses with a latest controversy sparked by the disclosure of correspondence between the Bush administration and US Congress that the Indo-US nuclear pact would be off if India conducted a nuclear test. The opposition BJP on Thursday, 4 September 2008, accused Prime Minister Manmohan Singh of misleading Parliament and the country on the nuclear deal issue and demanded the resignation of the Manmohan Singh government.
Senior BJP leader Yashwant Sinha said, in view of the gross breach of privilege of both the Houses of Parliament an immediate session of Parliament should be convened within the shortest possible time to enable BJP to move a privilege motion against the Prime Minister if the UPA did not quit.
The 45-members nuclear suppliers group (NSG) is currently debating on whether to allow a waiver to India for nuclear commerce, a decision that can take the Indo-US nuclear deal forward.
Weak global markets may continue to weigh on domestic bourses. Stocks across the globe fell sharply, last week, on global economic growth worries. In Europe, investors fretted over European Central Bank projections that showed an increase in inflation forecasts and a cut in growth expectations compared with their last prognosis three months ago.
Wall Street suffered its worst decline in more than two months on Thursday, 4 September 2008, hurt by more signs of weakness in the labour market and the growth fears. Global stocks will react to the influential US non-farm payroll data due on Friday, 5 September 2008, for August 2008, which is expected to show the eighth consecutive decline, with 75,000 jobs lost in the month. Asian shares were sharply lower on Friday, 5 September 2008.
Back home, the delay in the withdrawal of the monsoon is expected to benefit crops in the current kharif as well as in the ensuing rabi season. The region-wise distribution of rains, was satisfactory for agriculture, till August 2008 end, reports suggest.
Equity mutual funds are sitting on large cash pile and the market may find support once mutual funds start deploying the idle cash.
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