Market may open flat to slightly lower

Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a fall of 6 points at the opening bell. Most Asian shares rose on Friday after China's second-quarter gross domestic product data landed in line with forecasts. In corporate news, TCS said after market hours on Thursday, 12 July 2012, its consolidated net profit as per Indian GAAP jumped 14.6% to Rs 3318 crore on 12.1% growth in revenue to Rs 14869 crore in Q1 June 2012 over Q4 March 2012. Operating profit rose 10.8% to Rs 4077 crore in Q1 June 2012 over Q4 March 2012. Consolidated net profit as per International Financial Reporting Standards (IFRS) rose 2.89% to $604 million on 3.02% growth in revenue to $2.728 billion in Q1 June 2012 over Q4 March 2012. TCS said growth in Q1 June 2012 was quite broad-based. Growth was seen across all industry segments, led by Retail, Telecom and BFSI, TCS said in a statement. There was balanced growth across IT and other service lines led by BPO, enterprise solutions & infrastructure services, TCS said. Major markets grew smartly led by UK, USA and Europe alongside growth markets like Latin America, TCS said. TCS added 29 new clients in Q1 June 2012. Commenting on the Q1 performance, TCS Chief Executive Officer and Managing Director, N Chandrasekaran said: "We have seen strong, secular growth across all our service lines and industry segments driven by robust volumes from key markets like North America, Europe and UK. We have also absorbed impact of wage hikes and maintained our profitability in a volatile setting. Looking ahead, TCS continues to see good demand from global corporations as they successfully navigate an increasingly complex environment. Our investments in new technologies and platforms are bearing fruit with increasing market traction and we are confident of playing a pivotal role in our customers' future business evolution." TCS Chief Financial Officer and Executive Director S. Mahalingam said: "Our ability to closely monitor and maintain our operating expenses to support higher revenues is helping us maintain healthy margins. This ensures that we are able to continuously make investments needed in technology, capabilities and infrastructure to fuel growth over the long-term. The unprecedented volatility among major currencies and the Indian rupee will continue to be a challenge in the short term and we are taking the steps to mitigate any risks arising from this scenario." HDFC Bank declares its Q1 results today, 13 July 2012. India's largest engineering & construction firm by sales L&T said after trading hours on Thursday that it has inaugurated its manufacturing facility for switchgear products at Vadodara in Gujarat. The new switchgear facility is a part of L&T's Electrical & Automation (E&A) business. L&T said the new facility will manufacture Air Circuit Breakers (ACBs) and Moulded Case Circuit Breakers (MCCBs). A development centre to provide research, development and engineering for circuit breakers will also be located at this facility, L&T said. A smart mix of labour and automation has been deployed at the unit that would enhance productivity by 2.5 times, L&T said in a statement. The lines are equipped to produce circuit breakers of different frames and several ratings from 16A to 6300A. Speaking on the occasion, L&T Chairman and Managing Director A. M. Naik said, "The new Vadodara switchgear facility is an investment for the future. It forms part of the wide ranging initiatives we are taking forward in the run-up to our Platinum Jubilee. The facility at Vadodara will enable us to elevate switchgear manufacturing technology to the next level, and advance further in our goal to upgrade India's manufacturing capabilities." Bosch said after trading hours on Thursday, 12 July 2012, that with a view to adjust production to meet the demand for products and to avoid unnecessary buildup of inventory, the company has decided to suspend the manufacturing operations at its Bangalore plant for two days from July 13, 2012 to July 14, 2012. Power equipment makers will be in focus on reports the Ministry of Power has proposed protecting local manufacturers by expanding the 21% tax on imported generating equipment. The government already levies a 21% tax on imports of generating equipment for power projects with a capacity of less than one gigawatt. But equipment for larger projects is exempted as part of a drive to boost the country's generating capacity. HDFC said on Thursday that a total of 4.6 crore convertible warrants issued by the company in August 2009 are outstanding as on date. The conversion price for the warrant is Rs 600 per share. HDFC said the option of conversion of these outstanding warrants is available till 24 August 2012. Warrants which are not exercised on or before 24 August 2012 will lapse and cease to be valid and any amount paid towards them to date will stand forfeited, HDFC said. Lupin turns ex-dividend today, 13 July 2012, for dividend of Rs 3.20 per share for the year ended 31 March 2012 (FY 2012). Titan Industries turns ex-dividend today, 13 July 2012, for dividend of Rs 1.75 per share for FY 2012. The Union Cabinet on Thursday, 12 July 2012, approved the proposal to provide a special incentive package to promote large-scale manufacturing in the Electronic System Design and Manufacturing (ESDM) sector. Key benchmark indices fell for the second straight day to hit their lowest level in two weeks on Thursday, 12 July 2012, on weakness in global stocks and after IT major Infosys revised downwards both earnings and revenue growth guidance for the year ending March 2013 (FY 2013) in dollar terms after reporting disappointing Q1 June 2012 results before trading hours on Thursday, 12 July 2012. The BSE Sensex lost 256.59 points or 1.47% to settle at 17,232.55, its lowest closing level since 28 June 2012. Foreign institutional investors are buying Indian stocks this month. Foreign institutional investors (FIIs) bought shares worth a net Rs 268.54 crore on Thursday, 12 July 2012 as per provisional figures released by the stock exchanges. Earlier, FIIs bought shares worth a net Rs 3044.40 crore from the secondary equity markets during seven trading sessions from 3 July 2012 to 11 July 2012, as per data released by Securities & Exchange Board of India (Sebi). Monsoon rains have covered the entire country but the amount is unlikely to improve until next week, with overall rainfall 23% less than a long-term average, L.S. Rathore, director-general of the state-run India Meteorological Department (IMD) said on Wednesday. There is a strong chance of an El Nino weather event this season and it will likely emerge in August 2012, he told reporters. El Ninos are usually associated with lower rainfall. Lower rainfall this year is intensifying concerns that output of summer-sown crops such as oilseeds, sugar and pulses will fall compared with record-high levels in the last couple of years, hitting farm income. Monsoon rainfall has been deficient in 62% of the country's crop area so far. Annual monsoon rainfall has improved in the past 10 days, speeding up sowing of key summer-sown crops like rice and cotton, Agriculture Minister Sharad Pawar said on Wednesday, 11 July 2012. Poor rainfall in cane and pulses growing Maharashtra and Karnataka is cause for concern, he said. Maharashtra is the top sugar producer and second-biggest producer of soybeans, while Karnataka is the No. 1 coffee producer. Sowing of crops other than coarse grains has been progressing well, Mr. Pawar said. With monsoon rains advancing to all regions, sowing of rice--the main summer staple--is expected to pick up in the next few weeks, the minister said. 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. Corporate affairs minister Veerappa Moily said in a newspaper interview published on Wednesday, 11 July 2012, that the government is hopeful of the passage of the pension bill in the monsoon session of parliament. The monsoon session of parliament begins on 7 August 2012. An India-Mauritius joint panel will in August discuss a series of proposals to review the double taxation avoidance treaty between the two nations, Mauritius Foreign Minister Arvin Boolell said on Thursday, 5 July 2012. 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. India and Mauritius will discuss the renegotiation of the tax pact between 22-24 August 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 recently for implementing the controversial anti-avoidance tax proposal viz. the General Anti-Avoidance Rules (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 last week 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 scheduled on 19 July 2012. Mr. Mukherjee is the leading contender in the July 19 presidential election, having been nominated by the Congress party-led United Progressive Alliance government for the largely ceremonial post. The first quarter June 2012 earnings season has just begun. In the next one month, investors and analysts will closely watch the management commentary that would accompany the result to see if there is any revision in their future earnings forecast of the company for the current year or the next year. A deceleration in top line growth of India Inc amid economic slowdown and slowdown in investment cycle will weigh on bottom line growth in Q1 June 2012 as the core operating profit margin could be negatively impacted by deceleration in top line growth. Axis Bank announces Q1 results on 17 July 2012. Bajaj Auto reports Q1 results on 18 July 2012. Kotak Mahindra Bank, Hero MotoCorp and Dr Reddy's Laboratories unveil Q1 results on 19 July 2012. Reliance Industries and Asian Paints unveil Q1 results on 20 July 2012. Hindustan Unilever, L&T and Cairn India unveil Q1 results on 23 July 2012. Wipro announces Q1 results on 24 July 2012. Power Grid Corporation of India announces Q1 results on 25 July 2012. Bhel announces Q1 results on 26 July 2012. Ambuja Cements announces Q2 June 2012 results on the same day. ICICI Bank announces Q1 results on 27 July 2012. Maruti Suzuki India announces Q1 results on 28 July 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. Hindalco Industries announces Q1 results on 14 August 2012. Industrial production grew at a higher-than-expected pace of 2.4% in May 2012 driven by manufacturing output, government data showed on Thursday, 12 July 2012. Industrial production declined 0.9% in April 2012, with the government revising the figure downward from a provisional rise of 0.12% for the month. The government slightly revised upwards industrial production growth for February 2012 to 4.29% from 4.11% earlier. Manufacturing output, which has a 75.5% weight in the index of industrial production, grew 2.5% from a year earlier in May 2012. According to the revised numbers, it contracted 1.2% on year in April 2012, rather than the 0.1% rise reported earlier. Capital goods production shrank 7.7% in May 2012, following a revised 19.5% contraction in April 2012. Inflation based on the wholesale price index (WPI) is seen rising further to 7.62% in June 2012 from 7.55% in May 2012, as per the median estimate of a poll of economists carried out by Capital Market. The CSO will announce data on WPI inflation for June 2012 at 11:30 IST on 16 July 2012. 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. Most Asian stocks rose on Friday as US equity futures gained and oil trimmed losses after China's economy slowed for a sixth quarter, putting pressure on Premier Wen Jiabao to boost stimulus. Key benchmark indices in Hong Kong, Indonesia, Taiwan, South Korea and Singapore rose by between 0.1% to 0.59%. Key benchmark indices in China, Japan and Taiwan fell by between 0.05% to 0.1%. China's gross domestic product expanded 7.6% last quarter from a year earlier, the slowest pace since 2009, the National Bureau of Statistics said. The Bank of Korea lowered its estimate for the country's gross domestic product and Singapore's economy unexpectedly shrank. Moody's on Friday surprised markets by downgrading Italy's government bond rating by two notches to Baa2 and warned it could cut it further, piling on pressure just hours before the country launches its latest bond sale. The move left Italy's rating just two notches above junk status. Italian government tests sentiment in debt markets with a bond sale scheduled today, 13 July 2012. US stocks matched their longest losing streak this year on Thursday, with losses driven by downbeat corporate forecasts and worries about the global economy.