STRATEGY INPUTS FOR THE DAY

Dull times, concentrate

Life is dull only to dull people

Dare we say it may well just be another dull day on the bourses. With nothing to play on at the moment, the market will remain directionless and will witness more intra-day swings. Unless you are trading on the Nifty leave the broad direction aside and concentrate on counters you wish to buy . We expect the sideways movement to continue for a while before any fresh triggers emerge. There will be more churning of portfolios as investors look for more gains. The action will continue to be stock specific and news based.

Global factors will remain one of the key drivers of the sentiment. Investors should do well to avoid fresh buying at this juncture as the bulls clearly lack conviction . Still, if the market has to make a decisive movement in any direction, it may well be down first and then an up move. We expect the market to open on a cautious note today amid lack of clear indications from the global markets. The key stock benchmarks may just end on a flattish note yet again.

FIIs were net sellers of Rs2.84bn (provisional) in the cash segment yesterday. Local institutions too offloaded shares worth Rs599mn. In the F&O segment, they were net sellers of Rs1.13bn.

United Spirits will be in focus amid reports that Vijay Mallya is likely to announce the acquisition of Whyte & Mackay today. Wockhardt could be under pressure after Abbott Laboratories sued the Indian drug major to block regulatory approval of a generic version of the company's epilepsy treatment Depakote ER.

SBI and its three listed subsidiaries will hog the limelight after the Lok Sabha cleared a bill that will lend greater autonomy to SBI's seven subsidiaries. IT companies, already reeling under the steep appreciation in the rupee, may be hit further amid reports that two US senators have sent notices to lal big software firms on the alleged violation of the H-1B visa norms.

On Wall Street, the Dow Jones Industrial Average rose 37 points to 13,383.84, ending at a new record. The blue-chip barometer briefly hit an intraday mark of 13, 481.60 before retracing a bit.

The broader S&P 500 index finished almost flat at 1,501.19, after hitting a fresh six-year high during the session that set it within 15 points of its all-time high from March 2000.

The tech-fueled Nasdaq Composite was down 21 points at 2,525.29, limited by weakness in Amgen and a number of chip and Internet stocks.

Stocks were up through the early afternoon session as investors focused on a mild reading on inflation. However, the rally lost steam in the afternoon owing to a report showing further weakness in home building ahead of Wednesday's housing market report.

The Consumer Price Index (CPI) rose 0.4% in April, short of expectations. The so-called Core CPI, which excludes the volatile food and energy prices, rose 0.2%, as expected.

US light crude oil for June delivery rose 71 cents to settle at $63.17 a barrel on the New York Mercantile Exchange. The front-month contract was quoting 6 cents lower at $63.11 a barrel in extended trading in Asia.

COMEX gold for June delivery rose $4.40 to settle at $674.50 an ounce. Treasury prices slipped, pushing the yield on the 10-year note to 4.7%, up from 4.69% late on Monday. In currency trading, the dollar slipped against the euro and was little changed against the yen.

European shares closed higher. The pan-European Dow Jones Stoxx 600 index rose 0.1% to 389.17. The UK's FTSE 100 closed up 0.2% at 6,568.60, the German DAX Xetra 30 advanced 0.6% to 7,505.35 and the French CAC-40 added 0.4% to 6,049.76.

In the emerging markets, the Ibovespa in Brazil ended flat at 50,518 while the IPC index in Mexico lost 0.5% at 29,619 and the RTS index in Russia slumped 1.3% to 1826.

In Asia this morning, the Nikkei was down 40 points at 17,472 while the Hang Seng in Hong Kong advanced 45 points to 20,913. The Kospi in Seoul added 3 points at 1592 and the Straits Times in Singapore was flat at 3473.

A sluggish session ended almost on a flat note as lack of support from the Asian markets and selling pressure dragged the key indices to close in negative terrain. Techies continued to be on the receiving end and Sugar stocks also were battered. However Banking and Select FMCG stocks aided support to the markets. Media stocks were the star performers. Suzlon lost over 9% on back of lower than expected Q4 result. Finally, the 30-share benchmark Sensex dropped 36 points to close at 13929. NSE Nifty was down 14 points to close at 4120.

SBI gained by 1.8% to Rs1227 after Finance Minister announced that the Government would take control of the Bank by August. The scrip touched intra-day high of Rs1241 and a low of Rs1200 and recorded volumes of over 22,00,000 shares on NSE.

Suzlon Energy plunged by over 9% to Rs1137 after the company announced its Q4 result which were lower than market expectation�s. The company�s Q4 net profit was at Rs4.37bn (up 21%) and sales at Rs20.97% (up 33%). The scrip touched intra-day high of Rs1254 and a low of Rs1125 and recorded volumes of over 18,00,000 shares on NSE.

Havells India surged nearly by 5% to Rs498 after the company announced that they would pay dividend of Rs2.5 per share. The scrip touched intra-day high of Rs505 and a low of Rs477 and recorded volumes of over 3,00,000 shares on NSE.

Infotech Enterprises dropped 2.7% to Rs350. The company announced its strategic move to address Geospatial business opportunities in India and the Middle East by taking majority stake in Hyderabad-based Geospatial Integrated Solution Pvt Ltd. The scrip touched intra-day high of Rs362 and a low of Rs343 and recorded volumes of over 52,000 shares on NSE.

HDFC edged lower by 0.3% to Rs1671. The Company announced that it would buyout Chubb global stake in General Insurance venture. The scrip touched intra-day high of Rs1708 and a low of Rs1652 and recorded volumes of over 3,00,000 shares on NSE.

Banking stocks recorded smart gains led by gains in the index heavy weight ICICI Bank, the scrip was up by 2% to Rs887, SBI gained 1.8% to Rs1228, HDFC Bank advanced 1.4% to Rs1010 and Corp Bank added 1.3% to Rs318.

The media stocks put on a good show. Scrip�s like Raj TV was locked at 20% upper circuit to Rs226.40, WWIL spurred by over 5.5% to Rs73, Broadcast initiatives rose over 6% to Rs77 and Adlabs added 5.8% to Rs504.

Sugar stocks witnessed some profit booking after rallying for last couple of trading session. Renuka Sugar declined over 6% to Rs535, Sakhti Sugar was down 4.3% to Rs93, Balrampur Chini dropped by over 5.5% to Rs70 and Bajaj Hindusthan lost 5.8% to Rs167.

Insider Trades:
3i Infotech Limited: Shivanand R. Shettigar, General Manager & Company Secretary has sold in open market 2000 equity shares of 3i Infotech Limited on 10th May, 2007

Dena Bank: UBS Securities Asia Limited A/c. Swiss Finance Corporation (Mauritius) Ltd. has purchased from open market 2000000 equity shares of Dena Bank on 10th and 14th May, 2007

BSE Oil & Gas index was the major loser and lost 0.87%. BSE Technology index (down 0.69%), BSE Capital Good index (down 0.49%), BSE Auto index (down 0.48%) and Consumer Durable index (down 0.28%) were among the other major losers. However, BSE Bank index gained 1.65%.

Volume Toppers:
RNRL, IFCI, Petronet LNG, Idea, SAIL, FSL, WWIL, IB Real Estate, R Com, Indian Hotels, Bank of India, Cinemax, DCB, Arvind Mills, Broadcast Initiatives, Dena Bank and Dish TV

Upper Circuit:
Pratibha Industries, Ambalal Sarabai, UFlex, Shringar Cinemas, AMD Metplast, Bartronics, Thomas Cook, Tera Software, Mefcom Agro, Sujana Metal, Fortis, Flawless Diamond, Vyapar Industries, Raj Tele and Mercator Lines.

Delivery Delight:
Bharat Forge, BHEL, BPCL, Century Textiles, Gujarat Alkalies, Gujarat State Fertilizers, ICICI Bank and Indian Hotels.

Abnormal Delivery:
LIC Housing Finance Ltd, Federal Bank, ONGC, Electrosteel Castings, Thermax, Bajaj Auto, Tata Chemicals and Tata Power.

Stock Futures with largest increases in OI:
Financial Technologies, Moser Baer, Pantaloon, Petronet LNG, Kesoram Industries, Educomp and Adlabs Film.

Stock Futures with largest decreases in OI:
Nagarjuna Fertilizer, LIC Housing, Renuka Sugar, Voltas, BEML, Arvind Mills, HLL and Cipla.

Results Today:
Balaji Telefilms, Bongaigaon Refinery, Indo Rama Synthetics, JK Lakshmi Cement, D-Link, ICI India, JB Chemicals, Bharat Gears, Shanthi Gears and Entertainment Network India.

Results Corner:
Suzlon Energy net profit at Rs4.37bn (up 21%), sales at Rs20.97% (up 33%)

Brokers Recommendations:
BHEL - Buy from CLSA with target of Rs2950

Avaya Global - Buy from Emkay with target of Rs358

Reliance Capital - Buy from Merrill Lynch with target of Rs1025

Long Term investment:
HCL Tech

Major News Headlines:

Govt will take control of SBI by August: FM

Lok Sabha approves amendments in SBI Subsidiary Bank Laws Amendment Bill to

Seven SBI subsidiaries can raise fresh capital

RIL makes 2 new gas discoveries

Infotech Enterprises to buy stake in Geospatial Integrated

Suzlon to spend Rs8.5bn on Hansen unit expansion

Arvind Mills in JV with Diesel Planet

Hindalco completes acquisition of Novelis

Essar Global to consider building $3.4bn oil refinery in Egypt

KS Oil to consider stock split on May 23.