Market may open flat to slightly higher

Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a gain of 8.50 points at the opening bell. The market may remain volatile this week as traders roll over positions from the near-month July 2012 series to August 2012 series. The July 2012 derivatives contracts expire on Thursday, 26 July 2012. Asia stocks markets fell Tuesday, following sizeable losses on Wall Street on Monday as fresh worries about Europe took a fresh slug at investor confidence Among corporate news, Hindustan Unilever announced after market hours on Monday that net profit rose 112.25% to Rs 1331.19 crore on 16.98% rise in total income to Rs 6597.38 crore in Q1 June 2012 over Q1 June 2011. Harish Manwani, Chairman commented: “We have delivered another quarter of strong volume led growth with an improvement in margins. The environment continues to be challenging in terms of inflation and a general economic slowdown. In this context, we are implementing our strategy with even greater rigor and managing our business dynamically to remain competitive and cost efficient. We continue to drive innovation and execution to strengthen our core business while leading market development in the emerging categories.” Wipro announced before market hours today that as per International Financial Reporting Standards (IFRS) net income rose 18% to Rs 1580 crore on 24% rise in total revenues to Rs 10,653 crore in Q1 June 2012 over Q1 June 2011. In its outlook for the quarter ended September 2012 the company said it expects revenues from its IT Services business to be in the range of $1520 million to $1550 million. Azim Premji, Chairman of Wipro, commenting on the results said – “In today's complex businessenvironment, global corporations are increasingly investing in transformational technology initiatives to improve competitiveness. We see this shift as an opportunity for us to lead this change and help customers differentiate in this fast evolving market.” Suresh Senapaty, Executive Director & Chief Financial Officer of Wipro, said – “We have seen high levels of volatility in currencies globally. We have improved profitability, while continuing to invest for growth.” T K Kurien, Executive Director & Chief Executive Officer, IT Business, said – “We have delivered revenues in line with our guidance in a volatile environment. We will continue to build differentiation and invest in technology driven business transformations for our customers as well as rewarding our talent.” UltraTech Cement said that company has signed an agreement with the shareholders of Gotan Lime Stone Khanij Udyog (GKUPL), Rajasthan to acquire 100% equity shares of GKUPL. With this acquisition, GKUPL has become a wholly owned subsidiary of the Company. Sesa Goa and Jindal Steel & Power unveil Q1 results today, 24 July 2012. Idea Celluar announced after market hours on Monday that consolidated net profit rose 32.08% to Rs 234.14 crore on 21.74% growth in total income to Rs 5503.69 crore in Q1 June 2012 over Q1 June 2011. Cairn India announced after market hours on Monday its consolidated net profit rose 40.31% to Rs 3825.74 crore on 43.36% growth in total income to Rs 5402.75 crore in Q1 June 2012 over Q1 June 2011. Tata Power turns ex-dividend today, 24 July 2012, for dividend of Rs 1.25 per share for the year ended 31 March 2012 (FY 2012). PSU OMCs and auto firms will be in action as state-run oil marketing companies raised gasoline prices with effect Tuesday due to a rise in benchmark Singapore prices. The prices will go up by Rs 0.70 per liter excluding state levies. Gasoline currently sells at Rs 67.78 per liter ($1.23) in New Delhi, where the price of gasoline will rise by Rs 0.70. State-run fuel retailers review gasoline prices every fortnight. Key benchmark indices fell for the second straight trading session on Monday, 23 July 2012 to hit their lowest level in four weeks as stocks fell across the globe on renewed concerns over debt problems in Spain and Greece. The BSE Sensex was down 281.09 points or 1.64% to 16,877.35 on that day, its lowest level since 25 June 2012. Foreign institutional investors (FIIs) are buying Indian stocks this month. FIIs bought shares worth a net Rs 109.18 crore on Monday, 23 July 2012, as per provisional data released by the stock exchanges. Earlier, FIIs bought shares worth a net Rs 5461.90 crore from the secondary equity markets during 14 trading sessions from 3 July 2012 to 20 July 2012, as per data from Securities & Exchange Board of India (Sebi). The All-India Consumer Price Index Numbers for Agricultural Labourers (AL) and Rural Labourers (RL) for June 2012 increased by 8 points each to stand at 646 points for Agricultural Labourers and 648 points for Rural Labourers. The rise/fall in index varied from State to State, the Ministry of Labour & Employment said in a statement issued on Sunday, 22 July 2012. Point to point rate of inflation based on the CPI-AL and RL increased from 7.77% and 8.11% in May, 2012 and reached at the level of 8.03% and 8.54% in June, 2012. Inflation based on food index of CPI-AL and CPI-RL stood at 6.24% and 6.4%, Inflation is way above the desired threshold level of Reserve Bank of India, central bank governor D Subbarao said last week. The RBI's threshold level for inflation is around 5%, he said. However, the governor did issue a disclaimer that his statements did not imply RBI's decision in its July 31 policy. India's potential growth rate may have fallen to around 7.5% as the uncertainty surrounding economic activity has increased after the financial crisis of 2008-09, Subbarao said in a speech last week The Reserve Bank of India (RBI) announces first quarter review of the Monetary Policy 2012-13 on 31 July 2012. The RBI unexpectedly left its key lending rate unchanged at its last meeting in June 2012, citing inflationary concerns. Sowing of major kharif crops has picked in the last few days. According to data released by the Ministry of Agriculture, rice was sown in 144.59 lakh hectares (lh) till Friday, 20 July 2012, sharply higher than 96.79 lh a week back. It, however, remains lower than 153.37 lh of normal area for this time of the year and 161.27 lh during the corresponding period last year. Cumulative sowing of coarse cereals totaled 95.43 lh as on 20 July 2012, sharply higher than 39.76 lh a week back. It, however, remains lower than 126.20 lh of normal area for this time of the year Sowing of pulses totaled 40.19 lh as on 20 July 2012, sharply higher than 20.54 lh a week back. It, however, remains lower than 51.77 lh of normal area for this time of the year. Sowing of oilseeds totaled 108.84 lh as on 20 July 2012, sharply higher than 67.7 lh a week back. It, however, remains lower than 109.59 lh of normal area for this time of the year. Sowing of cotton totaled 83.74 lh as on 20 July 2012, compared with 65.22 lh as on 13 July 2012. It, however, remains lower than 90.03 lh of normal area for this time of the year. Sowing of jute and mesta totaled 8.27 lh as on 20 July 2012, exceeding 8.57 lh during the corresponding period last year. India Meteorological Department (IMD) on Friday, 20 July 2012, said rainfall scenario improved significantly over east and northeast India and also over south Peninsula during the week ended 18 July 2012. Out of 36 meteorological sub-divisions, rainfall was excess/normal in 14 (mainly over north eastern states & adjoining east India and south Peninsula) deficient in 16 and scanty in 6 sub-divisions (mainly in northwest and central India) during the week ended 18 July 2012. In area-wise distribution, 32% area of the country received excess/normal rainfall. Remaining 68% area received deficient/scanty rainfall. For the country as a whole, seasonal rainfall during this year's monsoon was 22% below the long period average (LPA) till 18 July 2012. Out of 36 meteorological subdivisions, the rainfall was excess/normal over 11, deficient in 22 and scanty in 3 sub-divisions (Punjab, Haryana, Chandigarh & Delhi and Saurashtra & Kutch). In area-wise distribution, 24% area of the country received excess/normal rainfall. The monsoon rains--which make up around 70% of India's annual rainfall--are crucial to the nation's agriculture sector and broader economy. More than 60% of the country's farmland is rain-fed. The timing, distribution and quantity of rainfall are all important for crops. The four-month southwest monsoon season that starts from June accounts for almost 70% of total annual moisture that Indian soil receives in a year. The central government has prepared extensive plans to deal with the deficiency in the monsoon/rainfall in some parts of the country, it said in a statement on 23 July 2012. There has been reduction of around eight million hectares in the crop area sown compared to last year. While the reduction in area sown in case of rice could be covered over time, area reduction in coarse cereals is likely to persist, the statement added. While the prices of wheat and rice are stable, the prices of sugar, pulses and vegetable are showing an upward trend, the government said. A proposal for increase in subsidy for supply of pulses through Public Distribution System to BPL families is being brought before Cabinet Committee on Economic Affairs by the Ministry of Consumer Affairs, Food and Public Distribution, it said. An India-Mauritius joint panel will discuss a series of proposals to review the double taxation avoidance treaty between the two nations on 22-24 August in Mauritius. India has been looking to negotiate the double taxation avoidance agreement with Mauritius for the past few years to check so-called round tripping and other potential abuses. Round tripping entails moving money out of one country to another, and getting it back under the garb of foreign capital. Capital gains tax is close to zero in Mauritius and almost 40% of investments into India come through the island nation. Under the bilateral agreement, capital gains from sale of securities can be taxed only in Mauritius. The India-Mauritius joint working group will also discuss the inclusion of a so-called limitation of benefit clause, similar to the Singapore tax treaty with India, to ensure only genuine Mauritius-based companies are benefited. India's tax agreement with Singapore says that only those companies that spend a minimum of $200,000 (about Rs 1 crore) in Singapore can avail the benefits of the treaty. Sanctity of tax residency certificates issued by a country to companies operating in its jurisdiction to enable the firms to claim tax benefits under various treaties is another issue between India and Mauritius. While India in this year's national budget said the certificates are a necessary but not sufficient condition, Mauritius wants those issued by it honoured. Draft guidelines issued by Indian government for implementing the controversial anti-avoidance tax proposal viz. the GAAR state that GAAR provisions should be invoked on a foreign institutional investor (FII), if it chooses to take a treaty benefit, but would not in any case be invoked in the case of the non-resident investors of the FII. The draft guidelines suggested that the onus of proving wrongdoing should be on the authorities. Prime Minister Dr. Manmohan Singh said in a newspaper interview this month that he has identified controlling the fiscal deficit, achieving clarity on tax matters, reviving the mutual funds and insurance industries, clearing a backlog of foreign investment proposals and boosting infrastructure as his focus areas in the short term. Singh said there will be no arbitrariness in tax matters. The statement assumes significance in the context of a raging controversy over the Income Tax amendment to re-open tax demands with retrospective effect from companies like Vodafone over acquisition of companies having operations in India but registered abroad to avoid taxes. Singh last month said he is chalking out plan for the country's economic revival. Singh last month took additional charge at the finance ministry after Pranab Mukherjee resigned as finance minister on 26 June 2012 to contest the presidential polls. The monsoon session of the parliament will begin on 8 August 2012 and the session will conclude on 7 September 2012, Parliamentary Affairs Minister Pawan Kumar Bansal said on Wednesday, 18 July 2012. The government hasn't yet finalized the agenda for the session, but the expectation is that Prime Minister Dr. Manmohan Singh -- who took charge of the finance ministry after Mr. Pranab Mukherjee resigned to contest the presidential elections -- will try and push through long-pending legislations. These could include the Direct Tax Code and the insurance, pension and banking bills. The government would also place before lawmakers the first demand for additional spending for this fiscal year which began April 1. Corporate affairs minister Veerappa Moily said in a newspaper interview published on 11 July 2012 that the government is hopeful of the passage of the pension bill in the monsoon session of parliament. Investors' focus is currently on Q1 June 2012 earnings. Power Grid Corporation of India unveils Q1 results tomorrow, 25 July 2012. HCL Technologies announces Q4 June 2012 results on the same day. ITC, Bhel and Sterlite Industries (India) unveil Q1 results on 26 July 2012. Cement majors ACC and Ambuja Cements unveil Q2 June 2012 results on the same day. ICICI Bank, Grasim Industries, NTPC and Punjab National Bank unveil Q1 results on 27 July 2012. Maruti Suzuki India announces Q1 results on 28 July 2012. HDFC announces its consolidated Q1 June 2012 results on the same day. HDFC has already announced its standalone results. Bank of Baroda and GAIL (India) unveil Q1 results on 30 July 2012. Jaiprakash Associates and Cipla unveil Q1 results on 31 July 2012. Steel Authority of India announces Q1 results on 6 August 2012. Mahindra & Mahindra announces Q1 results on 8 August 2012. Ranbaxy Laboratories announces Q2 June 2012 results on 9 August 2012. BPCL announces Q1 results on 10 August 2012. ONGC announces Q1 results on 11 August 2012. Hindalco Industries and IDFC will unveil Q1 results on 14 August 2012. Asian stocks fell on Tuesday on concern Europe's debt crisis is worsening after Moody's Investors Service cut the outlooks for Germany, the Netherlands and Luxembourg to negative. Key benchmark indices in China, Japan, South Korea and Taiwan fell by between 0.11% to 0.6%. Key benchmark indices in Singapore and Indonesia rose by between 0.47% to 0.66%. Hong Kong's Hang Seng was flat. Germany, the Netherlands and Luxembourg had the outlooks for their Aaa credit ratings lowered to negative by Moody's Investors Service, which cited “rising uncertainty" about Europe's debt crisis. Risks that Greece may leave the 17-nation euro currency and “increasing likelihood” of collective support for European countries such as Spain and Italy were among reasons for the change, Moody's said yesterday in a statement. “Given the greater ability to absorb the costs associated with this support, this burden will likely fall most heavily on more highly rated member states if the euro area is to be preserved in its current form,” Moody's said. Germany's Federal Constitutional Court will announce a decision on lawsuits challenging the country's participation in the permanent euro-zone rescue fund, the European Stability Mechanism, and the fiscal pact on 12 September 2012. The court held a public hearing earlier this month to examine complaints that participation in the fund and the fiscal pact violated German law by taking some authority over the national budget away from parliament. US shares tracked a sharp sell off in global equity markets on Monday as Spain appeared closer to needing a bailout and fears grew that Greece may be approaching an exit from the euro zone. Some prominent US firms announce earnings this week. Apple releases its much-anticipated fiscal third-quarter results after trading hours in the US on Tuesday, 24 July 2012. Boeing Co., Caterpillar Inc., Ford Motor and PepsiCo Inc. present their second-quarter results on Wednesday, 25 July 2012. Facebook Inc., which has been under scrutiny over its ability to grow its subscriber base, will report its first results as a public company on Thursday, 26 July 2012. Key US economic data due this week include new home sales on Wednesday, 25 July 2012. Data on weekly jobless claims, durable-goods orders, and pending-home sales data is due on Thursday, 26 July 2012. Data on US GDP growth figure for the second quarter is due on Friday, 27 July 2012. The Federal Open Market Committee holds a two-day policy meeting on US interest rates on 31 July and 1 August 2012.