Power Grid IPO

Power Grid IPO

Eveninger - Sep 11 2007

Eveninger - Sep 11 2007

Post Market Commentary

The markets closed on negative note as BSE Sensex closed lower by 54.06 points at 15,542.77 and the Nifty slipped by 10.8 points to close at 4,497.05. The BSE mid cap closed lower by 8.65 points at 6,875.74 while Small cap closed higher by 14.72 points at 8,529.09. The market breadth was strong with 1,402 stocks advanced and 1340 stocks declined.

BSE Metal index surged by 166.17 points to close at 11,772.22 as SH.Precoated (5%), Jindal steel (4.80%), Tata Steel (2.27%), Jindal stainless (2.20%) and sterlite industries (0.85%) closed in green.

BSE Capital goods index advanced by 59.97 points to close at 13,714.26 as Suzlon energy (3.60%), Alstom projects (1.87%), BHEL (1.03%), Thermax (1.01%) and L&T (0.41%) closed higher.

BSE FMCG index grew by 12.95 points to close at 2,098.05 as United spirits (4.81%), Dabur India (3.69%), Colgate Palmolive (1.91%) and HUL (1.47%) closed in green.

BSE Health Care Index closed lower by 16.99 points at 3,703.82 as Nicho;as piramal (2.31%), Lupin (2.26%), Dr Reddy''s lab (1.01%), Glaxosmithkline (0.68%) and Cipla (0.59%) closed lower.

BSE bankex index closed lower by 62.30 points at 8,038.07 as SBI (1.12%), ICICI bank (1.11%), Yes bank (1.08%), BOI (0.78%), HDFC bank (0.71%), Canara bank (0.59%) closed in negative while IOB (7.22%) closed in positive

BSE Auto Index dropped by 33.24 points to close at 4,867.13 as Ashok Leyland (2.34%), Tata Motors (1.88%), Maruti Udyog (1.65%) and Mahindra and Mahindra (0.50%) closed in negative while Bajaj Auto (0.24%) and Hero Honda (0.02%) closed in positive.

BSE oil & gas index increased by 0.78 points to close at 8,260.71 as HPCL (2.30%), BPCL (1.65%), GAIL (0.58%) and RPL (0.08%),closed higher while IPCL (0.69%), ONGC (0.46%) and Indian Oil (0.15%) are closed lower.

BSE IT index slipped by 100.33 points to close at 4,470.56 as HCL Tech.(2.93%), Infosys (2.58%), Wipro (2.45%), TCS (2.21%) and Satyam (2.04%) closed in red.

Market Close: ?Recession? clouds market !

Support from the retail investors was able to offset the impact of weak global cues in the initial sessions. However cautious was there in air which dragged the indices in the negative territory as the session progressed. Global jitters also had their role to play in the down ward journey. However, the small and mid caps continued out perform the index heavy weights. Technology counter slipped as Rupee appreciated to a 5 week high against the dollar. Worries in US continues and we dont think that thing will improve in near future. Higher crude also added to the existing worries on the bourses. Auto, Banking and Reality counters were some other counters to weigh on index. European indices were green.

Unconfirmed reports stated that the Chinese authorities in order to tame inflation (at present 6%) intend to hike the interest rates or open monthly sales. Some reports also stated that the Britain's biggest banks could be forced to cough up as much as £70bn over the next 10 days, as the credit crisis that has seized the global financial system sparks a fresh wave of chaos. Credit crisis now seems to be a global worry. Fed would meet on 18th Sep and everyone believes that interest rate would be cut this time. Let see if whether this provide some ease to markets.

Sensex was down by 54 points at 15542.77. Weighing on the Sensex were losses in Infosys (1823.2,-3 percent), Wipro (455.5,-2 percent), TCS (1023.85,-2 percent), Satyam (433.25,-2 percent) and Tata Motors (689.65,-2 percent). Losses were restricted by gains in NTPC (195.75,+2 percent), TISCO (708.7,+2 percent), HDFC (2148.05,+2 percent), Hindalco (157.1,+2 percent) and HLL (217.05,+1 percent).

ABG Shipyard is set to take over Western India Shipyard (WISL) for Rs 200 cr report papers. ABG will get management control of WISL and the 40% stake held by financial institutions led by ICICI Bank. It's a court initiated sale as WISL has more debt in its book. The current outstanding debt is Rs 280 cr. WISL is a one of the India's largest composite ship repairer at Goa. WISL revenues were placed at around Rs 53 cr. Assuming Rs 200 cr for the 40% stake valuations are placed at Rs 500 cr and also there is this extra 280 cr of debt giving an enterprise value of 780 cr. The ABG's Enterprise value to sales is 4.8:1. However WISL is a loss making company and hence utilisation levels would be low. ABG has an order book of Rs 5000 cr which probably could be handled better using the facilities; this acquisition helps ABG to with a foot into ship repairing business and that should be a good fit. The acquisition seems strategically good for ABG. But the acquisition price is something where data is lacking to give a fair comment. Meanwhile the uncertainty of the subsidy continues. However, WISL got locked in circuits higher by 5%.

Ceat is a part of RPG group and accounts for 31% of group revenues. RPG group is not a favored group known for its cross holdings and lack of transparency to smaller shareholders. The company has 12% market share in the Indian tyre market. It has revenues of Rs 1747.42 cr. Company derives 70% of its revenues form the car manufacturers the remaining is from the exports and the replacement. We expect the EBIDTA margins to go down in the coming quarters because of higher rubber prices and volatile crude. Our note should convince you why we feel other players are better placed in the industry as compared to ceat. Do read our note to know more. However, The stock closed higher by 3% for the day.

Technically Speaking: Sensex traded between an intra day high of 15,699 and low of 15,506. Advance and Declines ratio was 1:1. The volume for the day stood at Rs.4,935 cr. Sensex is facing resistance at 15700 but we believe it is just a matter of time before we cross it and move towards our target of 16100. On the lower side supports at 15490 and 15350.

Heavyweights, tech stocks drag market down

The Sensex continued its subdued trend for the second consecutive session. The market was gloomy amid a range-bound trend during the intra-day trades. After adding more than 71 points to yesterday's close, the market soon eased and slipped further in the afternoon, as investors booked profits in select pivotal stocks. Lack of buying support and selling in technology stocks triggered a major slump and the Sensex touched the day's low at 15,506. Select buying towards the close saw the Sensex pare some losses and end the session at 15,543, down 54 points. Nifty shed 11 points and closed at 4,497.

The market breadth was positive. Of the 2,802 stocks traded on the BSE, 1,402 stocks advanced, 1,339 stocks declined and 61 stocks ended unchanged. All the sectoral indices gained marginally. The BSE Metal index was the major gainer and surged 1.43% followed by the BSE FMCG index (up 0.62%) and the BSE PSU index (up 0.56%). However, the BSE IT index tumbled 2.19%, the BSE Teck index was down 1.41%, the BSE Auto index shed 0.68% and the BSE Bankex index fell 0.77%.

Among the 30 Sensex stocks, 11 ended at higher levels while 19 closed in the red. NTPC led the upsurge and flared by 2.41% at Rs196. Among the other major gainers Tata Steel surged 2.27% at Rs709, HDFC moved up by 1.98% at Rs2,145, Hindalco advanced 1.62% at Rs157, HLL added 1.47% at Rs217 and BHEL gained 1.03% at Rs1,911 while ACC, L&T, Bajaj Auto and Ranbaxy closed with moderate gains.

Select IT stocks witnessed considerable selling pressure. HCL Tech dropped 2.93% at Rs285, Infosys lost 2.58% at Rs1,823, Patni Computers declined by 2.49% at Rs461, Wipro slipped by 2.45% at Rs456 and TCS was down 2.21% at Rs1,024.

Over 2.85 crore Tata Teleservices shares changed hands on the BSE followed by IFCI (2.44 crore shares), Reliance Natural Resources (1.77 crore shares), Nagarjuna Fertilisers (94.36 lakh shares) and IKF Technologies (81.20 lakh shares).

Motilal Oswal was the most actively traded counter on the BSE and registered a turnover of Rs363 crore followed by IFCI (Rs188 crore), Reliance Industries (Rs120 crore), Tata Steel (Rs108 crore) and Tata Teleservices (Rs96 crore).

IT shares lead fall

The market saw trend reversal from initial firmness to end in the red. The sentiment turned nervous ahead of a key meeting of the government with left parties on the Indo-US nuclear deal. The market had opened on an upbeat note tracking steady global markets. A bout of volatility was witnessed in the second half of the day’s trading. Domestic market underperformed its global peers today.

The BSE 30-share Sensex shed 54.06 points or 0.35% at 15,542.77. It opened higher at 15,668.40 and advanced further to hit a high of 15,698.98. The index touched a low of 15,506.10.

At the day's low of 15,506.10, the Sensex had lost 90.73 points for the day. At the day’s high, the Sensex had gained 102.15 points for the day. It oscillated in a band of 192.88 points for the day.

The BSE Sensex is 326.08 points away from its all time high of 15,868.85 hit on 24 July 2007.

The S&P CNX Nifty was down 10.80 points or 0.24% at 4,497.05. The Nifty September 2007 futures settled at 4488.20, a discount of 8.85 points as compare to spot closing.

The panel set up by the government to look into the Left Front's concerns over the Indo-US nuclear deal is holding its first meeting today, 11 September 2007. While the operationalisation of the deal has been put on hold pending the findings of the panel, it cannot be stalled forever. A flashpoint may come sooner or later.

The four Communist parties have 60 members of parliament (MPs) in the 545-member lower house of parliament. Prime Minister Manmohan Singh's government could fall or be reduced to a minority if the Left withdraws support.

Yet, analysts reckon that political turmoil arising from nuke deal will not impact India’s basic economic fundamentals though some infrastructure projects may get delayed. India’s economy is expected to post strong growth for a long period of time mainly due to favourable demographics.

The market breadth was positive on BSE, with 1,410 shares advancing as compared to 1,356 that declined, while 65 remained unchanged. The breadth was much stronger in morning trade when 1231 shares had risen, 241 had declined and 30 were unchanged.

The BSE Mid-Cap index slipped 0.13% to 6,875.74, while the BSE Small-Cap index gained 0.17% to 8,529.09. Both these indices outperformed the Sensex.

The BSE Mid-Cap index hit an all-time high of 6,950.58, and the BSE Small-Cap index struck a lifetime high of 8,610.97 earlier during the day.

Sectoral indices on BSE displayed mixed trend. The BSE Oil and Gas Index (up 0.01% at 8,260.71), BSE Consumer Durables index (up 0.21% to 4,557.89), BSE Realty index (up 0.01% to 7,531.79), BSE PSU index (up 0.56% to 7,368.52), BSE Metal Index (up 1.43% at 11,772.22), BSE Capital Goods Index (up 0.44% at 13,714.26) and BSE FMCG Index (up 0.62% at 2,098.05) outperformed the Sensex.

However, the BSE Auto Index (down 0.67% at 4,867.41), BSE Bankex (down 0.77% at 8,038.07), BSE Health Care Index (down 0.46% at 3,703.82), BSE TecK index (down 1.41% to 3,554.38), and BSE IT Index (down 2.19% at 4,470.56) were underperformers.

The total turnover on BSE amounted to Rs 4935 crore as compared to Rs 4047 crore on Monday, 10 September 2007. The NSE F&O turnover was Rs 41739.52 crore as compared to Rs 37333.48 crore on Monday, 10 September 2007.

From 30-member Sensex pack, 20 declined while the rest gained.

IT pivotals edged lower for the second day in a row today after data released on Friday, 7 September 2007, showed US payrolls shrank in August 2007 for the first time in four years, raising fears that the world's largest economy was headed into a recession.

India’s third largest software services exporter Wipro was the top loser from the Sensex pack. It slipped 2.44% to Rs 455.550 on 1.86 lakh shares.

Other IT pivotals Satyam Computers (down 2.32% to Rs 432), Infosys Technologies (down 2.33% to Rs 1828), and TCS (down 2% to Rs 1026) also declined. IT companies derive over 50% of their revenue from exports from the US markets

The Indian rupee was trading slightly firm at 40.60 against the US dollar. It had settled at 40.65/66 yesterday, 10 September 2007.

The BSE IT index lost 4.22% to 4,570.89 to 10 September 2007 from its close of 4,774.13 on 10 August 2007.

Auto stocks declined on profit booking. Tata Motors (down 1.54% to Rs 691.85), Maruti Udyog (down 1.96% to Rs 859.10), and Mahindra & Mahindra (down 0.73% to Rs 696.10) dipped.

NTPC, the nation's top power generation company in terms of revenue, advanced 2.30% to Rs 195.50 on 17.20 lakh shares. It struck an all time high of Rs 197.50 in intra-day trade. It was the top gainer from the Sensex pack. As per reports, the power ministry has sought waiver of new external commercial borrowings (ECB) norms for the power sector to allow it to use funds raised abroad for rupee expenditure.

India’s largest dedicated mortgage finance firm by revenue Housing Development Corporation (HDFC) advanced 1.98% to Rs 2145.10. HDFC struck an all-time high of Rs 2153 in intra-day trade.

World’s sixth largest steel producer in terms of total steel production Tata Steel gained 2.16% to Rs 708 on reports that it is looking at building a 5-million tonne steel plant in South Africa.

Engineering companies Larsen & Toubro (up 0.48% to Rs 2590.10) and Bhel (up 1.22% to Rs 1912) were the other gainers from the Sensex pack

India’s largest private sector entity by market capitalisation and oil refiner Reliance Industries (RIL) slipped from an all-time high of Rs 2007 struck in early trade. It declined 0.34% to Rs 1980.40 on 6 lakh shares.

As per reports, RIL has warned that fresh bidding for the price of natural gas produced from the Krishna Godavari’s-D6 fields could lead to market distortion and cartelisation. RIL claims that the bidding process followed by RIL (that discovered the gas price of $4.33 per million British thermal unit) was a transparent and legally-complete process in line with the provisions of the production sharing contract with the government.

Among side counters, Gulf Oil Corporation (up 17.28% to Rs 1275), Neyveli Lignite Corporation (up 10.09% to Rs 93.25), CCL Products (up 11.74% to Rs 264.05), Birla Kennametal (up 10% to Rs 299.95), and Zenith Birla (up 20% to Rs 42.40) surged.

SEL Manufacturing (down 5.60% to Rs 135.70), JRG Securities (down 6.64% to Rs 53), Bombay Burmah Trading Corporation (down 5.77% to Rs 525), Manugraph Industries (down 4.68% to Rs 123.25), and Emkay Shares & Stock Brokers (down 8.04% to Rs 142.40) slipped.

Motilal Oswal Financial Services settled at Rs 977.45 on the BSE, a premium of 18.47% over IPO price of Rs 825. On BSE, 37.19 lakh shares of the scrip were traded. The scrip had debuted at Rs 999 on BSE. It also hit a high and low of Rs 999 and Rs 913 respectively. The IPO of Motilal Oswal Financial Services had ended on 20 August 2007 with 27.41 times subscription.

Jindal Steel & Power jumped 4.87% to Rs 4150 on reports that the Bolivian parliament had approved a joint venture with the Indian company to develop iron ore mines and set up a steel plant in the country. The Bolivian government is also exploring ways and means to disburse an initial funding for the joint venture (JV) company, Empresa Siderurgica del Mutun.

IFCI rose 4.37% to Rs 77.70 on reports that US-based private equity group Blackstone is likely to join the race to acquire a 26% stake in the firm. Reportedly, Blackstone could come in as a standalone strategic investor or as the lead partner in a consortium.

Nitco Tiles gained 4.05% to Rs 238.90 on reports that firm has forayed into import and distribution of cement and is importing 1 million tonnes (MT) of cement from Pakistan. Nitco is importing through the MMTC, the nodal agency for importing cement from foreign companies, reports suggest.

Rallis India advanced 3.08% to Rs 325 on reports of that it is in the race to acquire the world’s largest privately held crop protection and life sciences firm, Arysta LifeScience Corporation, from private equity firm Olympus Capital Holdings.

United Phosphorus, which is also in the race to acquire Arysta LifeScience Corporation gained 1.81% to Rs 345. These two Indian companies are among the six contenders for the Tokyo-based firm, reports suggest. The acquisition is expected to cost nearly $2 billion (Rs 8,200 crore), or nearly double Arysta's turnover of 124.1 billion yen (Rs 4,400 crore) last year. Arysta is a leading crop protection and life sciences firm.

Shipping Corporation of India rose 2.20% to Rs 197.10 after Baltic Exchange's dry freight index, gauging the strength of the seaborne dry commodities trade, set a record for a fourth consecutive week on Monday, 10 September 2007, on surging raw materials demand and port congestion.

Modern Dairies jumped 5% at Rs 150.90 ahead of its record date for issuing bonus shares. Modern Dairies has fixed 1 October 2007 as record date for issuing bonus shares, in the ratio of 1:1 (1 bonus share for every 1 equity share held).

Blue Dart Express jumped 2.49% to Rs 622 on it plans to invest about Rs 1000 crore in the short- to medium-term to expand its air infrastructure. The company will expand its aircraft fleet, add material handling equipment and ramp up ground handling facilities.

Private equity firm IL&FS Investment Managers rose 3.87% to Rs 174.25 after the company said after market hours on Monday, 10 September 2007, it has tied up with Milestone Capital Advisors to raise up to Rs 1000 crore through a real-estate fund.

Idea Cellular rose 0.61% to Rs 123.20 after its board approved a proposal to spin off its telecom towers business into a subsidiary.

Nagarjuna Construction Company rose 2.20% to Rs 219.75 after the company during trading hours today, 11 September 2007, announced it had bagged new orders totaling Rs 272 crore.

Cairn India, a unit of Cairn Energy Plc, rose 0.80% to Rs 158 after the company said during trading hours today, 11 September 2007, it had received approval from the Indian government granting access to land for building a pipeline from Rajasthan state.

Jaiprakash Hydro-Power slipped 3.41% to Rs 49.50 after the National Stock Exchange of India (NSE) barred further F&O positions in the underlying as 95% of market wide limit was reached yesterday, 10 September 2007. Market-wide position limit for derivative contracts is the lower of 30 times the average number of shares traded daily, during the previous calendar month, in the relevant underlying security in the underlying segment (cash market segment) or 10% of the number of shares held by non-promoters in the relevant underlying security.

Moser Baer (India) gained 1.49% to Rs 308.95 after it announced its foray in computer peripherals market with the launch of its optical disk drive (ODD), a combo drive and DVD writer.

All the European markets, which opened after the Indian markets, were trading higher. Key benchmark indices in London (up 1.52% to 6,227.60), Germany (up 1.12% to 7,458.35) and France (up 1.47% to 5,465.61) edged higher.

Asian markets settled mixed today, 11 September 2007. Japan's Nikkei (up 0.71% at 15,877.67), Taiwan's Taiwan Weighted (up 0.73% at 9,003.12) and Singapore's Straits Times (up 1.53% points at 3,494.57) gained.

However, Shanghai Composite (down 4.51% to 5,113.96) and Hang Seng (down 0.20% at 23,9522.24), slipped.

US shares finished a volatile session with small gains yesterday, 10 September 2007 as investors grappled with the possibility that the Federal Reserve might not lower interest rates as much as they hope. The Dow Jones industrial average rose 14.47 points, or 0.11%, to 13,127.85. Broader stock indexes fell. The Standard & Poor's 500 index slipped 1.85 points, or 0.13%, to 1,451.70, and the Nasdaq Composite index declined 6.59 points, or 0.26%, to 2,559.11.

Crude oil prices surged to near a record high on Tuesday, 11 September 2007, after attacks on oil and natural gas pipelines rocked the world's fifth largest crude producer Mexico, ahead of an OPEC meeting to determine production policy. US light crude rose 40 cents to $77.89 a barrel and is now near its record high of $78.77 hit on 1 August 2007. London Brent crude rose 36 cents to $75.84

Grey Market - Power Grid, Koutons, Dhanus, Kaveri

Power Grid Corporation 44 to 52 14 to 15 ( Please VOTE in the POLL ABOVE)

Dhanus Tech. 280 to 295 110 to 120

Koutons Retail 370 to 415 90 to 95

Allied Computer 12 0

Kaveri Seeds 150 to 170 23 to 25

Motilal Oswal 825 135 to 145

Indowind Energy 55 to 65 Discount

Magnum Venture 30 2 to 3

Daily Market Outlook - Sep 11 2007

Daily Market Outlook - Sep 11 2007

Daily Call - Sep 11 2007

Daily Call - Sep 11 2007

Pre Market Watch

Indian market is likely to have a positive opening as the Asian market is trading mixed and US market closed mixed. On Monday, the Indian markets ended flat, as BSE Sensex closed little higher by 6.41 points at 15,596.83 while Nifty slipped by 1.65 points to close at 4,507.85. We expect the market to remain range bound during the trading session.

On Monday, the US market closed in mixed. The Dow Jones Industrial Average grew by 14.47 points to close at 13,127.85. The Nasdaq Composite Index fell by 6.59 points to close at 2,559.11. The S&P 500 index decreased by 1.85 points to close at 1,451.70.

Indian ADRs ended in mixed. In technology sector, Patni computers grew by (1.94%) while Wipro slipped by (2.12%) along with Infosys and Satyam by (1.82%) and (1.23%) respectively. In banking sector, HDFC bank and ICICI bank advanced by (1.59%) and (0.68%) respectively. VSNL grew by (0.51%) while MTNL closed lower by (0.28%).

The major stock markets in Asia are trading mixed. Japan''s Nikkei trading higher by 39.43 points to trade at 15,804.40. Hang Seng grew by 42.80 points to trade at 24,042.50. Taiwan weighted advanced by 65.84 points to trade at 9,003.42. Singapore Strait times trading up by 36.27 points at 3,478.14.

Today, Nifty has support at 4,467 and resistance at 4,570 and BSE Sensex has support at 15,510 and resistance at 15,760.

Sideways movement to continue

After registering marginal gains in yesterday's trades the market is expected to be remain subdued following the mixed global cues. The market may witness sideways movement during intra-day trades. However, the current net inflows from FIIs may help the sentiment to turn positive. The Nifty could test 4,490 on the downside and may test higher levels at 4,550 and on breaching this level may test the short-term target of 4,620, while the Sensex has a likely support at 15,250 and may face resistance at 15,700.

US indices little changed on Monday, on concerns about economy and worries about big rate cut form Fed officials next week. While the Dow Jones gained marginally by 14 points at 13128, the Nasdaq slipped seven points to close at 2559.

Most of the Indian ADRs barring few ended at lower levels on the US bourses. Wipro slipped 2% while Infosys, Satyam, Dr Reddy's Lab, MTNL and Rediff were down by 0.50% to 1% each. However, Tata Motors, ICICI Bank, HDFC Bank, VSNL and Patni computers gained around 1%.

Crude oil prices in the global market extended their upward trend, with the Nymex light crude oil for October series jumping by 79 cents at $77.49 a barrel. In the commodity space, the Comex gold for December delivery moved up by $2.50 to settle at $712.20 a troy ounce.

Market to head higher

The market is expected to head higher today, on positive global cues. However profit booking may emerge at higher levels as the first meeting of the UPA-Left committee on the Indo-US nuclear deal is likely to take place anytime before 14 September 2007. The meeting date was speculated to be somewhere between 10 to 14 September 2007.

Most of the Asian markets were trading higher today, 11 September 2007. Japan's Nikkei (up 0.25% at 15,804.40), Hang Seng (up 0.18% at 24,042.50), Taiwan's Taiwan Weighted (up 0.74% at 9,003.42) and Singapore's Straits Times (up 1.05% points at 3,478.14) gained. However Shanghai Composite was down 0.32% to 5,338.38.

US shares finished a volatile session with small gains yesterday, 10 September 2007 as investors grappled with the possibility that the Federal Reserve might not lower interest rates as much as they hope. The Dow Jones industrial average rose 14.47 points, or 0.11%, to 13,127.85. Broader stock indexes fell. The Standard & Poor's 500 index slipped 1.85 points, or 0.13%, to 1,451.70, and the Nasdaq Composite index declined 6.59 points, or 0.26%, to 2,559.11.

Crude oil prices surged to near a record high on Tuesday, 11 September 2007 after attacks on oil and natural gas pipelines rocked the world's fifth largest crude producer Mexico, ahead of an OPEC meeting to determine production policy. US light crude rose 40 cents to $77.89 a barrel and is now near its record high of $78.77 hit on 1 August 2007. London Brent crude rose 36 cents to $75.84.

As per provisional data, foreign institutional investors (FIIs) sold shares worth a net Rs 190.15 crore, while domestic institutional investors (DIIs) were net buyers of shares worth Rs 9.82 crore on Monday, 10 September 2007.

The BSE 30-share Sensex rose 6.41 points or 0.04% at 15,596.83, on Monday, 10 September 2007. It is now 272.02 points away from its all time high of 15,868.85 hit on 24 July 2007.

The S&P CNX Nifty declined 1.65 points or 0.04% at 4,507.85, on Monday, 10 September 2007.

Daily Technical Futures - Sep 11 2007

Daily Technical Futures - Sep 11 2007

Trading Calls

Nifty (4508) Supp 4485 Res 4535

Buy RCom (544)
SL 539 Target 552, 556

Buy Kotak Bank (747)
SL 741 Target 762, 765

Buy Chennai Petro (285)
SL 280 Target 295, 297

Sell Sterlite (602)
SL 608 Target 590, 588

Sell HCL Tech (294)
SL 299 Target 286, 283

Tuesday twists and turns

We will not tire, we will not falter, and we will not fail. - (George Bush, Speech after 9/11 attacks)

The bulls managed to brush aside the global weakness yesterday to end flat. The small-cap and mid-cap shares did even better. The traded volume and turnover were down, as is generally the case on the first day of the week. What is interesting is that FIIs were net sellers on a provisional basis. They were also net sellers in the F&O segment. Despite this, we expect the Indian market to weather the subprime-related storm due to strong economic fundamentals and good traction in earnings growth. Having said that the market remains vulnerable to global volatility, especially in the form of fund flows from overseas investors. In addition, we have to grapple with the ongoing political uncertainty, which is far from over and could lead to mid-term polls early next year.

Today, we see a cautious to positive opening. With its usual twists and turns it may yet be another range bound kind of session. Although we advocate some caution, one can accumulate quality stocks at every dip as the long-term outlook is upbeat.

Shares of Motilal Oswal Financial Services Ltd. will get listed on the bourses today. The stock is expected to open with a 10-15% premium to the issue price of Rs 825 per share. It may even touch Rs1,000 if the momentum is good. Market grapevine is that a large corporate house through its associates may mop up some shares today. Rallis India and United Phosphorus plan to bid for Japan's Arysta LifeScience Corp., according to a report.

IFCI is expected to be in action as a financial daily reports that private equity major Blackstone is eyeing the state-run term lender. Also keep an eye on Bartronics, Bongaigaon Refinery, Ranbaxy and Voltas for the coming days. Sun Pharma could be under pressure as US-based Sepracor and the University of Massachusetts have sued the Indian drugmaker to prevent it from launching a generic version of anti-allergic treatment Clarinex. Rajesh Exports could advance amid reports that it is looking at buying jewellers in South India.

US shares closed mixed on Monday after a fairly volatile session, as worries about the downturn in the housing sector and its wider fallout on the economy continued to weigh on investors. Two Federal Reserve officials suggested that the US economy may be faltering because of the housing slump.

Countrywide Financial fell to a four-year low, leading declines in the Standard & Poor's 500 Index, after Merrill Lynch said bond market losses continue to handicap the largest US mortgage company.

Home Depot's warning that real estate prices won't recover until late next year sent the biggest home-improvement retailer to the lowest level in three weeks.

The S&P 500 lost 1.85 points, or 0.1%, to 1,451.7. The Nasdaq Composite Index declined 6.59 points, or 0.3%, to 2,559.11. McDonald's and American Express led the Dow Jones Industrial Average up 14.47 points, or 0.1%, to 13,127.85.

About five stocks dropped for every two that rose on the New York Stock Exchange.

US stocks started on a positive note due to Intel's improved profit outlook, but the early advance proved unsustainable. The US stock market is bound to remain very choppy in the lead up to the Federal Reserve's meeting, on Sept. 18.

Crude oil rose to within 50 cents of a record on speculation that rising demand and restricted OPEC production may tighten fourth-quarter supplies. Oil rallied in the last half hour of trading in New York after spending almost the entire day with sharp losses.

Light, sweet crude for October delivery rose 79 cents to settle at $77.49 a barrel on the New York Mercantile Exchange, rebounding from earlier losses of more than $1 a barrel.

Treasury prices rose, adding on to Friday's big rally on continued bets that the Fed will need to cut interest rates when it meets next week. The advance lowered the yield on the 10-year note to 4.32% from 4.38% late on Friday.

In currency trading, the dollar fell versus the euro and rose against the yen. COMEX gold for December delivery rose $2.50 to $712.20 an ounce.

European stocks ended lower. The pan-European Dow Jones Stoxx 600 index fell 0.9% to 362.23, after moving back and forth between positive and negative territory throughout the session. The UK's FTSE 100 closed down 0.9% at 6,134.10, the French CAC 40 fell 0.8% to 5,386.43 and the German DAX 30 lost 0.8% to 7,375.44.

Latin American equities fell as well. Brazil's Bovespa index slid 3.5% to 52,652.57. In Mexico, the IPC lost 1.2% to 29,892.18. The Merval in Argentina fell 1.1% to 2,018.16, and Chile's IPSA lost 1.4% to 3,155.56. In other emerging markets, the RTS index in Russia closed flat at 1898 while the ISE National-30 index dropped 1.2% to 60,951.

Asian markets were trading flat to slightly higher after a weak start. The Nikkei in Tokyo gained 39 points to 15,804 while the Hang Seng in Hong Kong was flat at 24,001 and the Kospi in Seoul too was nearly unchanged at 1836.

Markets bounced back as bulls managed to make a comeback in the late trades. Yet another jolt from the global markets, especially from the US dragged the Indian bourses to start with a gap down. However, positive opening from the European markets and recovery in Hong Kong’s Hang Seng index lifted the sentiments. Mid-Cap stocks led as the index gained by 1%.

However, Volumes were lower; turnover in NSE cash segment fell 10.1% and in F&O segment dropped 3.4%. Finally, BSE 30-share benchmark Sensex gained 6 points to close at 15596. NSE Nifty ended flat at 4507.

RIL, ITC, SBI and Bharti Airtel were the leading movers. On the other hand, Infosys, ICICI Bank, ONGC and HDFC were the major laggards among the Sensex stocks.

BHEL edged higher 0.3% to Rs1889 after the company along with NTPC Ltd, the country's biggest utility has planned to form a company to build power plants. The scrip touched an intra-day high of Rs1900 and a low of Rs1844 and recorded volumes of over 4,00,000 shares on NSE.

Hindustan Zinc slipped by 0.2% to Rs712. India's largest producer of zinc lowered prices of the metal for the third time in eight days to match global rates. The rate was lowered by 2.1% to Rs136,300 per metric ton. The scrip touched an intra-day high of Rs715 and a low of Rs700 and recorded volumes of over 59,000 shares on NSE.

Jet Airways fell by 1.5% to Rs889. Reports have stated that the nation's biggest domestic carrier will raise air fares across all categories by Rs200 as demand rises. The scrip touched an intra-day high of Rs916 and a low of Rs876 and recorded volumes of over 3,00,000 shares on NSE.

Bharti Airtel gained by 0.6% to Rs853 after the company secured license from Singapore to offer Global Connectivity. The scrip touched an intra-day high of Rs857 and a low of Rs835 and recorded volumes of over 6,00,000 shares on NSE.

Reliance Communication marginally slipped 0.3% to Rs543. The company announced that they have started blackberry Service in India. The scrip touched an intra-day high of Rs545 and a low of Rs534 and recorded volumes of over 26,00,000 shares on NSE.

Cement stocks were in momentum. ACC gained by 0.6% to Rs1093, Ambuja Cement surged by over 3% to Rs144, Mangalam Cement was up by over 4.5% to Rs194 and India Cement added 1.3% to Rs270.

Select Capital Good stocks ended with smart gains. ABB gained by 1.4% to Rs1217, BHEL was up by 0.2% to Rs1889 and Punj Lloyd added 1.5% to Rs309. However, L&T declined 0.6% to Rs2577.

FMCG stocks ended higher led by gains in the index heavyweight, ITC advanced nearly by 4% to Rs184, Tata Tea was up by 2% to Rs775, McDowell gained 2.5% to Rs1581 and Nirma added 0.3% to Rs165.

Banking stocks also managed to stage a come back led by gains in the index heavyweights like SBI, the scrip was up by 1.3% to Rs1640, PNB gained by 0.8% to Rs493 and Union Bank added 1.1% to Rs147. However, ICICI Bank slipped by 1% to Rs910.

IT stocks were on the receiving end as Indian rupee yet again strengthened against the USD Satyam Computer slipped by 1.6% to Rs442, Wipro was down by 2.7% to Rs465, TCS slipped by 2.7% to Rs1047 and Infosys lost 2% to Rs1871.

Oil PSUs stocks also gained momentum amid reports that the Government would go for a marginal fuel price hike shortly. HPCL surged by over 3.5% to Rs241, BPCL was up by 3.5% to Rs315. However, IOC edged lower by 0.3% to Rs403.

Stocks In News

Sun Pharma says that USFDA has granted final approval for the company’s ANDA to market its generic version of Wyeth’s Protonix, pantoprazole tablets. These strengths of Protonix have annual sales of about USD 2.3bn.

UCO Bank plans to raise Rs.2bn through Equity or debt, targets 20% credit
growth.

Power Finance Corp (PFC) to raise Rs5bn through bond issue in local markets. The RBI had earlier rejected its application to raise $200mn from overseas markets.

Reliance Industries to pump in Rs100bn in Positra Port and Special Economic Zone.

Yes Bank to foray into retail broking space, to incorporate separate subsidiaries for banking business.

Fund Activity:

FIIs were net sellers of Rs1.9bn (provisional) in the cash segment on Monday and the local institutions pumped in Rs98.2mn. In the F&O segment, foreign funds were net sellers of Rs5.16bn.

On Friday, FIIs were net buyers to the tune of Rs5.8bn in the cash segment. Mutual Funds were net sellers of Rs1.88bn on the same day.

Major Bulk Deals:

Lotus Global has bought Alpa Labs; Kotak Mahindra has picked up Emkay Shares; Morgan Stanley has purchased Escorts; Citigroup Global has bought Noida Toll Bridge while CLSA has sold it; Goldman Sachs has sold Searle (India) and Ubs Securities has sold Welspun Gujarat.

Upper Circuit:

Marksans, Emkay Share, Usher Agro, Godawari Power, Tanla, Taneja Aerospace, Bajaj Electrical, IID Forgings, Empire Industries.

Delivery Delight (Rising Price & Rising Delivery):

GSK Pharma, Sundaram Clayton, Gail India and Pratibha Industries.

Abnormal Delivery:

Apollo Tyres, Bharat Forge, Essar Shipping and Syndicate Bank.

Major News & Announcements:

Hindustan Unilever terminates talks with Temptation Foods

Bharti secures license from Singapore to offer Global Connectivity

HSBC, Canara Bank, OBC to form insurance company

Satyam to expand in Europe, Asia Pacific

R Com starts blackberry Service in India

Marg Construction to sell shares to Bennett, Coleman & Co.

WHO adds 3 Ranbaxy aids drugs to distribution list

BHEL signs MoU with NTPC

Kirloskar Brothers buy Gondwana Engineers for Rs76.36mn

RIL buys Polyster assets of Malaysia based Hualon – Reports