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Friday, January 18, 2008
Sensex sheds 687 points on sell-off in heavyweights
The market slumped for a fifth trading session in a row today in a broad-based decline. Reliance Industries (RIL), ICICI Bank and DLF plunged. All the sectoral indices on BSE were in the red. BSE oil & gas and realty indices were the worst hit in today's fall. Small-caps and mid-cap stocks sank. Ranbaxy Laboratories was the star performer in today’s trade. Cement pivotals, too, survived the fall.
The market breadth was weak. 25 out of 30 shares from the Sensex pack were in the red. Asian markets came off lower level during the course of the trading session, from early fall. Most of the European indices, which were bleak in early trade, turned green during the course of the day.
Annual inflation, based on the wholesale price index (WPI), moved up 3.79% in the week ended 5 January 2008 compared with 3.5% in the week ended 29 December 2007.
Oil Minister Murli Deora said on Friday, 18 January 2008 that any rise in retail prices of petrol and diesel would be minimal. The Group of Ministers (GoM) on fuel prices would meet again on Saturday, 19 January 2008 to discuss the fuel price hike. A meeting of Indian ministers, which was expected to recommend a rise in retail prices of petrol and diesel, ended on Thursday, 17 January 2008 without a decision.
The 30-share BSE Sensex fell 687.12 points or 3.49% to 19,013.70. The BSE Sensex lost 8.71% in the week ended on Friday, 18 January 2008.
Sensex opened with a negative gap of 121.21 points. Soon, by early afternoon the market managed to enter the positive territory and gain 14.96 points at the day's high of 19,715.78. But relentless selling pressure in the index heavyweights pulled the index down and the Sensex shed 770.40 points at day's low of 18,930.42 at the fag end of the trading session.
The broader CNX S&P Nifty fell 207.90 points or 3.52% to 5705.30. Nifty lost 7.98% in the week ended on Friday, 18 January 2008. Sensex lost 8.8% in the week.
The BSE Mid-Cap index dropped 4.78% to 8,893.71. The BSE Mid-Cap index lost 5.77% in the week ended on Friday, 18 January 2008. The BSE Small-Cap index lost 4.55% to 12,160.45. The BSE Small-Cap index 4.20% in the week ended on Friday, 18 January 2008. Both these indices underperformed the Sensex in today’s trade.
The market breadth was weak. On BSE, 2505 shares declined as compared to 362 that rose. 23 remained unchanged.
BSE clocked a turnover of Rs 8753 crore compared to Thursday (17 January 2007)'s Rs 8,471.87 crore.
Nifty January 2008 futures were at 5728.80, at premium of 23.50 points compared with spot closing of 5705.30.
The NSE futures & options (F&O) segment turnover was Rs 72852.64 crore, which was higher than Rs 67865.55 crore on Thursday, 17 January 2008.
India’a largest private sector firm by market capitalization and oil refiner Reliance Industries fell 6.57% to Rs 2799.50.
The BSE Bankex lost 5% to 11,372.41. It underperformed the Sensex. India’s largest private sector bank by assets ICICI Bank fell 5.78% to Rs 1245.45. The ICICI Bank stock shed 13.50% in the week ended Friday, 18 January 2008 after an earlier sharp surge on its plan to list four of its subsidiaries starting with its securities arm.
Kotak Mahindra Bank slumped 10.46% to Rs 1130.65, Canara Bank dropped 9.61% to Rs 317.80, Bank of India shed 9.21% to Rs 405.85, Bank of Baroda skid 6.49% to Rs 434m Axis Bank fell 4.04% to Rs 1112.75 and State Bank of India declined 2.08% to Rs 23.68.30.
The BSE Oil & Gas index fell 5.88% to 12,594.91. It underperformed the Sensex. ONGC fell 3.33% to Rs 1209.45, Essar Oil slumped 8.09% to Rs 271.35, Indian Oil Corporation slipped 7.58% to Rs 607, Aban Offshore skid 5.89% to Rs 4382.30, HPCL gave away 5.74% to Rs 310.95 and Reliance Natural Resources fell 5.23% to Rs 205.75.
The BSE Realty index slipped 5.81% to Rs 12,021.74. It underperformed the Sensex. DLF fell 7.37% to Rs 1,005.75, Ansal Properties & Infrastructure slumped 12.69% to Rs 311.75, Penland shed 11.49% to Rs 129.40, Housing Development & Infrastructure fell 10.57% to Rs 1246.65, Omaxe shed 6.33% to Rs 423.75 and Unitech fell 3.13% to Rs 474.85.
Among the Sensex losers, NTPC slipped 6.30% to Rs 239.55, HDFC Bank fell 4.33% to Rs 1575.85, Reliance Energy dropped 4.01% to Rs 2124.05, Reliance Communications fell 3.73% to Rs 702.15, Larsen & Toubro declined 3.62% to Rs 3930.10, Tata Steel slipped 3.49% to Rs 781.90, Tata Motors declined 3.35% to Rs 712.20, and Mahindra & Mahindra dropped 3.19% to Rs 728.40.
Among the Sensex gainers, Grasim Industries advanced 1.03% to Rs 3340.70, Ambuja Cements rose 0.88% to Rs 131.95, ACC gained 0.48% to Rs 864.60, Bharti Airtel moved up 0.24% to Rs 973.90, and Satyam Computers rose 0.04% to Rs 372.60.
India’s largest drug maker by sales Ranbaxy Laboratories soared 5.10% to Rs 386.65. The company reportedly said its profit might grow 25% this year driven by higher sales of treatments for infections, diabetes and AIDS in emerging markets. On Thursday, 18 January 2008 Ranbaxy reported an almost flat result in Q4 December 2007 with profits after tax at about Rs 188 crore, on a consolidated basis. Consolidated net sales for the quarter grew 5% to Rs 1,784 crore.
India's biggest cigarette maker by revenue ITC rose 2.07% to Rs 212.60. The company reported 15.79% rise in net profit to Rs 830.72 crore on 12.90% increase in sales to Rs 3595.39 crore. The company declared the results during market hours today.
India's biggest dedicated housing finance firm by revenue, Housing Development Finance Corporation (HDFC) fell 1.05% to Rs 2819. HDFC reported net profit of 82.54% rise in net profit to Rs 648.93 crore on 47.83% increase in sales to Rs 21,50.35 crore in Q3 December 2007 over Q3 December 2006. The sharp surge in net profit was due to one-off gains.
Lumax Industries slumped 11.03% to Rs 338.05 after the auto parts maker said its board would meet on 30 January 2008 to consider closing its Chennai unit and the sale of its assets.
Diversified firm Jaiprakash Associates rose 1.38% to Rs 418.95 on reports the company bagged the Rs 40,000 crore Ganga expressway project in Uttar Pradesh.
Engineering firm Artefact Projects fell 0.98% to Rs 174.90. The company said on Thursday, 17 January 2008 its board has approved raising upto Rs 30 crore through equity or debt.
Entertainment firm Pyramid Saimira Theatre rose 0.79% to Rs 454.80. The company said on Thursday, 17 January 2008 it will raise about $400 million (Rs 1,600 crore) from the global market by March 2008. The funds raised will be used to consolidate the company’s international businesses and pursue plans for global acquisitions and expansion.
Shipping firm Essar Shipping was locked at upper limit of 5% at Rs 232.45 on reports that the company may merge a group company Essar Oilfield Services with itself, hoping to increase its stock market value through the addition of this high-potential and fast-growing business.
Reliance Industries clocked the highest turnover of Rs 493.87 crore on BSE. Housing Development Finance Corporation (Rs 414 crore), Reliance Natural Resources (Rs 389.07 crore), Reliance Energy (Rs 320.49 crore) and ICICI Bank (Rs 221.42 crore), were the other turnover toppers on BSE in that order.
Ispat Industries reported highest volume of 1.24 crore shares on BSE. Reliance Petroleum (1 crore shares), NTPC (73.34 lakh shares), Spice Communications (45.43 crore shares) and IDBI (38.08 crore shares), were the other volume toppers on BSE.
Major European markets recovered after trading in red earlier in the day. In Europe, key indices in UK, and France were up by 0.28% to 1.32%. However, Germany’s DAX was down 0.07%
Asian markets reversed early losses on growing hopes for measures to boost the US economy from President George W. Bush. Key benchmark indices in China, Hong Kong, Taiwan, Japan and South Korea were up 0.35% to 1.02%. Bush told lawmakers on Thursday, 17 January 2008, he wants tax rebates for families and breaks for businesses to boost the struggling US economy.
US stocks fell sharply on Thursday, 17 January 2008, as news of a plunge in regional factory activity and a hefty loss at Merrill Lynch further clouded an increasingly dire view of the US economy. The Dow Jones industrial average plunged 306.95 points, or 2.46%, to close at 12,159.21, on Thursday. The Standard & Poor's 500 Index lost 39.95 points, or 2.91%, at 1,333.25. The Nasdaq Composite Index shed 47.69 points, or 1.99%, at 2,346.90.
In one of the strongest signals yet that the economy is at high risk of contracting, the Philadelphia Federal Reserve Bank said mid-Atlantic factory activity has slowed much more than expected to levels that typically signal recession.
Securities and Exchange Board of India (Sebi) on Thursday, 17 January 2008 proposed a price band for stocks on their market debut to curb sharp swings. The Sebi suggested a 25% price band on the day of listing for initial public offerings of up to Rs 250 crore.
A unit of rating agency Moody's said on Thursday, 17 January 2008 suggested that India's economy should expand 8% in 2008, slower than 8.8% last year, as tight monetary conditions dampen loan demand and creaky infrastructure hobbles growth.
A deep recession in developed economies will have an adverse impact on the Indian economy, C. Rangarajan the chairman of the prime minister's Economic Advisory Council said in a news conference on Thursday, 18 January 2008.
Market opens on a weak note
The market edged lower in opening trade tracking weak global markets. Index heavyweights Reliance Industries and ICICI Bank fell. All the sectoral indices on BSE were in the red. Banking and realty shares were the worst hit.
The market breadth was weak. 23 out of 30 shares from the Sensex pack were in the red. Asian markets, which opened before Indian market, were mostly in the red.
A meeting of Indian ministers, which was expected to recommend a rise in retail prices of petrol and diesel, ended on Thursday, 17 January 2008 without a decision. The panel is likely to meet again on Friday, 18 January 2008 or Saturday, 19 January 2008.
The 30-share BSE Sensex was down 256.41 points or 1.30% to 19,444.41. Sensex hit a low of 19,425.19 at the onset of the trading session. At the day's low, Sensex declined 275.63 points.
The broader CNX S&P Nifty was down 75.65 points or 1.28% to 5837.55.
The BSE Small-Cap index was down 1.22% to 12,584.91. The BSE Mid-Cap index rose 1% to 9,246.36.
The market breadth was weak. On BSE, 1508 shares advanced as compared to 704 that declined. 38 remained unchanged.
India’a largest private sector firm by market capitalization and oil refiner Reliance Industries fell 1.48% to Rs 2951.90.
India’s largest private sector bank by assets ICICI Bank fell 2.10% to Rs 1294.10.
India’s largest engineering and construction firm by revenue Larsen & Toubro declined 2.08% to Rs 3993.
Among the other Sensex losers, HDFC Bank shed 2.63% to Rs 1603, DLF slipped 2.46% to Rs 1059, Satyam Computers fell 1.75% to Rs 365.55, Bharat Heavy Electricals skid 1.72% to Rs 2308 and ONGC fell 1.69% to Rs 1230.
Among the Sensex gainers, Ranbaxy Laboratories rose 1.63% to Rs 373.90, Ambuja Cements advanced 1.26% to Rs 132.05, Reliance Energy gained 0.78% to Rs 2230, Grasim Industries rose 0.70% to Rs 3330 and Bajaj Auto moved up 0.69% to Rs 2459.
In Asia, key benchmark indices in Hong Kong, China, Japan, South Korea, were down by 0.17% to 1.22%. However, Taiwan’s Taiwan Weighted index was up 0.40%.
US stocks fell sharply on Thursday, 17 January 2008, as news of a plunge in regional factory activity and a hefty loss at Merrill Lynch further clouded an increasingly dire view of the US economy. The Dow Jones industrial average plunged 306.95 points, or 2.46%, to close at 12,159.21, on Thursday. The Standard & Poor's 500 Index lost 39.95 points, or 2.91%, at 1,333.25. The Nasdaq Composite Index shed 47.69 points, or 1.99%, at 2,346.90.
In one of the strongest signals yet that the economy is at high risk of contracting, the Philadelphia Federal Reserve Bank said mid-Atlantic factory activity has slowed much more than expected to levels that typically signal recession.
FIIs sold shares worth a net Rs 2267.40 crore on Thursday, the day when Sensex lost 167 points. Domestic funds bought shares worth a net Rs 734.75 crore on that day.
FIIs were net buyers of index futures to the tune of Rs 611.60 crore on Thursday. They net bought index options worth Rs 279.71 crore. FIIs sold individual stock futures to the tune of Rs 1220.25 crore on that day.
Securities and Exchange Board of India (Sebi) on Thursday, 17 January 2008 proposed a price band for stocks on their market debut to curb sharp swings. The Sebi suggested a 25% price band on the day of listing for initial public offerings of up to Rs 250 crore.
A unit of rating agency Moody's said on Thursday, 17 January 2008 suggested that India's economy should expand 8% in 2008, slower than 8.8% last year, as tight monetary conditions dampen loan demand and creaky infrastructure hobbles growth.
A deep recession in developed economies will have an adverse impact on the Indian economy, C. Rangarajan the chairman of the prime minister's Economic Advisory Council said in a news conference on Thursday, 18 January 2008.
Pre Market Watch - Jan 18 2008
The Indian Market is likely to have a negative opening due to weak global cues. Yesterday, The Indian market closed in red consecutively for the fourth straight trading session. The market opened on a firm note taking cues from the Asian markets but volatility ruled the market through out the trading session. The market gained the momentum towards the mid session but unable to sustain all its gains as the profit booking across the counters prevailed towards the final trading hours of the session.The BSE Sensex closed lower by 167.29 points at 19,700.82 and NSE Nifty fell by 22.55 points to close at 5,913.20. We expect that the market may remain cautious during the trading session.
On Thursday, the US market closed in red. The Dow Jones Industrial Average (DJIA) closed lower by 306.95 points at 12,159.21. S&P 500 index slipped by 39.95 points to close at 1,333.25 and NASDAQ dropped by 47.69 points to close at 2,346.90
Indian ADRS closed in red. In technology sector, Patni Computers fell by 4.21% along with Wipro by 0.32% while Satyam and Infosys grew by 0.09% and 0.05% respectively. In banking sector, ICICI bank and HDFC bank slipped by (5.36%) and (5.27%) respectively. MTNL and VSNL dropped by (4.93%) and (3.16%) respectively.
The major stock markets in Asia are trading weak. Hang Seng is trading lower by 826.33 points at 24,288.65 along with Japan''s Nikkei trading down by 387.67 points at 13,395.78 and Taiwan Weighted is trading at 7,979.74 down by 121.89 points.
On Thursday, the FIIs stood as net seller both in equity and debt. The gross equity purchased was Rs4,662.30 Crore and the gross debt purchased was Rs81.80 Crore while the gross equity sold stood at Rs6,941.90 Crore and gross debt sold stood at Rs182.50 Crore. Therefore, the net investment of equity reported was (Rs2,279.60 Crore) and net debt was (Rs100.80 Crore).
Today, Nifty has support at 5,771 and resistance at 5,967 and BSE Sensex has support at 19,169 and resistance at 19,936.
Emaar MGF, Reliance Power, Future Capital Holdings
Future Capital Holdings 700 to 765 540 to 550
Reliance Power 405 to 450 340 to 350
J. Kumar Infraprojects 110 to 120 25 to 30
Cords Cable Ind. 125 to 135 30 to 35
Emaar MGF 725 to 850 370 to 375
US recession fears may hover on local indices
The market is likely to continue its downtrend as major Asian gauges like the Nikkei, the Hang Seng index, the Kospi index and the Jakarta index have tumbled in current trades and US market slipped over 2% in yesterday's trades on U.S. Federal Reserve Chairman Ben Bernanke's comments about worsening economic outlook. The domestic indices also received a heavy pounding for the last four sessions on the back of lack of clarity in the market. The Sensex erased over 1,000 points on intense selling backed by strong volatility during intra-day trades to finally closed at 19,700 marks on Thursday. Among the indices, the Nifty could test higher levels at 6,100 and has a supports at 5,840 and 5,675. The Sensex has a likely support at 19,500 and may face resistance at 20,500.
Key announcements like Anant Raj Industries, BASF, Guj Alkalies, ITC, IFCI, Kirloskar Oil Engineens, NIIT Tech, Power Fincial Corporation, Wipro are expected to announce their figures.
US indices tumbled on Thursday on recession worries following comments from Federal Reserve Chairman Ben Bernanke, a big quarterly loss by Merrill Lynch and weak readings on the housing and manufacturing sectors. While the Dow Jones fell 307 points at 12159, the Nasdaq slipped by 48 points to close at 2347.
Indian floats also tumbled on the US bourses. Wipro, VSNL, Dr Reddy's, Tata Motors, ICICI Bank, HDFC Bank, MTNL and Rediff dropped over 1-5% each. However, Infosys and satyam gained marginally.
Stock-specific activity may rule the roost
The market may edge lower tracking weak global markets. US stocks fell sharply on Thursday, 17 January 2008, as news of a plunge in regional factory activity and a hefty loss at Merrill Lynch further clouded an increasingly dire view of the US economy. In one of the strongest signals yet that the economy is at high risk of contracting, the Philadelphia Federal Reserve Bank said mid-Atlantic factory activity has slowed much more than expected to levels that typically signal recession.
The Q3 December 2007 results announced by India Inc. so far have been more or less in line with market expectations. Stock-specific activity may rule the roost in the near term based on expectations of results of individual firms. Some of the top brokerages expect a slowdown in earnings growth of 30-Sensex firms in Q3 December 2007.
Just a while ago, Wipro reported 11% growth in net profit as per US accounting standards to Rs 826 crore in Q3 December 2007 over Q3 December 2006. The other key results scheduled today are ITC and HDFC.
The government will release the inflation figure for the year through 5 January 2008 today. Annual inflation, based on the wholesale price index (WPI), stood at 3.5% in the year through 29 December 2007, same as the year through 22 December 2007.
Meanwhile, no decision was taken yesterday, 17 January 2008, at a meeting of the group of ministers (GoM) on fuel prices. GoM meet again later. A hike retail fuel prices will result in increase in inflation.
In Asia, key benchmark indices in Hong Kong, China, Japan, South Korea, and Taiwan were down by between 0.1% to 2.32%.
The Dow Jones industrial average plunged 306.95 points, or 2.46%, to close at 12,159.21, on Thursday. The Standard & Poor's 500 Index lost 39.95 points, or 2.91%, at 1,333.25. The Nasdaq Composite Index shed 47.69 points, or 1.99%, at 2,346.90.
FIIs sold shares worth a net Rs 2267.40 crore on Thursday, the day when Sensex lost 167 points. Domestic funds bought shares worth a net Rs 734.75 crore on that day.
FIIs were net buyers of index futures to the tune of Rs 611.60 crore on Thursday. They net bought index options worth Rs 279.71 crore. FIIs sold individual stock futures to the tune of Rs 1220.25 crore on that day.
US Market plunges on economic concerns
Loss from Merrill Lynch and discouraging statement from Fed Chairman take Dow to ten month low
It was disastrous day for the US Market today, Thursday, 17 January, 2008. Worries about further financial market turmoil and a slowing economy were the main reasons for today’s sell-off. A disappointing quarterly report from Merrill Lynch and discouraging comments from Federal Reserve Chairman, Ben Bernanke regarding the economy just spurred the sell-off further. The indices posted large losses ending at their session’s lows for the day. All ten economic sectors ended in the red.
The Dow Jones industrial Average ended the day with a loss of 307 points at 12,159. The Nasdaq Composite Index, finished lower by 47.7 points at 2,347. S&P 500 finished lower by 39.9 points at 1,333. All thirty Dow stocks ended in the red today led by AIg and Merck.
Before the opening bell, Merrill Lynch reported its earnings and the company posted a net loss from continuing operations of $10.3 billion, mainly due to nearly $15 billion worth of write-downs from poor subprime mortgage investments. That was well below analysts' expectations.
Also today, Federal Reserve Chairman, Ben Bernanke reiterated that the outlook for growth in 2008 "has worsened" and "the downside risks to growth have become more pronounced." But he also said that the Fed is not forecasting a recession this year. Last week he had hinted that more interest rate cuts are on the way to help the situation from worsening further.
Initial claims data gives the day a good start but fails to hold on
Stocks opened higher earlier in the day on a lower than expected jobless claim number. Initial jobless claims for the week ended 12 January unexpectedly fell to 301,000, its lowest reading in eight months. Market expected claims to rise to 335K. Dow was up by as much as 100 points at one point.
On the negative side, the Commerce Department reported today that construction on new homes fell 14% in December to a seasonally adjusted annual rate of 1.01 million, the slowest building pace in more than 16 years.
Also on the economic front, the Philadelphia Fed Index, a regional manufacturing survey, was sharply lower at -20.9, its lowest number since Oct. 2001. The consensus estimate predicted a reading of -1.5. Since the number is below zero, it reflects a contraction in manufacturing.
Crude prices once again fell today. Price slipped after traders once again got gripped by fears of recession. The “r” word once again came into focus after fresh comments from Federal Reserve chairman, Ben Bernanke. Yesterday, Energy Department had reported that crude stockpiles rose more than expected for the first time in nine weeks. This also led to softening of crude price. Crude-oil futures for light sweet crude for February delivery today closed at $90.13/barrel (lower by $0.71/barrel or 0.8%) on the New York Mercantile Exchange.
Volume on the New York Stock Exchange surpassed 2.1 billion, and declining stocks beat those rising 5 to 1. On the Nasdaq, 2.8 billion shares traded, and decliners outdid advancing issues, 3 to 1.
As fourth quarter earnings continues to pick up, investors will be looking for corporate financials to help set the tone of trading. Tomorrow, a number of widely-held companies are expected to report their results, including Dow component General Electric.
Morning Call - Jan 18 2008
Market Grape Wine :
In House :
Nifty at a supp of 5825 and 5740 levels with resistance at 5980 and 6020 levels .
Weak Opening Expected .
Sell : Intraday : Aptech below 350 target 338 s/l of 356
Sell : Intraday CanBk below 351 target 340 s/l of 355
Buy : in F&O : HDIL above 1414 target 1465 s/l of 1395
Buy : in F&O BajajHind : above 348 target 369 s/l of 340
Out House :
Markets at a support of 19515 & 19339 levels with resistance at 19786 & 19991 levels .
Buy : RIL at dips
Buy : SBIN at dips
Buy : NTPC
Buy : Balrampur & BajajHind
Buy : Primesecurity
Buy : IBUllsreal
Buy : Adhunik
Buy : JSW at dips
Buy : ITC & HLL
Dark Horse : Adlab , PrimeSec , Adhunik , GujNRE , JpAsso , RIL & SBIN
Bullion metals end mixed
Silver prices rise but gold drops for the third consecutive day
Bullion metals ended mixed today, Thursday, January 17, 2008. While silver rose, gold continued to drop for the third consecutive day. Gold Prices eased today further after crude prices also slipped.
Gold generally moves in the opposite direction of the U.S. currency. Gold, as a dollar-denominated commodity, suffers from dollar strength.
Comex Gold for February delivery today fell $1.5 (0.2%) to close at $880.5 an ounce on the New York Mercantile Exchange. They rose to an intraday high of $891.5 an ounce earlier and also fell to an intraday low of $875.2. On Tuesday, 15 January, during intraday trading prices rose as high as $916.1/ounce, but the slipped. This year, prices have gained 5% till date.
Gold has traditionally been used as a safe-haven asset against rising inflation. Investor sentiments are boosted by the fact that gold and silver are alternate sources of good investment in the face of declining dollar and rising energy prices. Rising crude increases inflationary pressures and vice versa. On the other hand strong dollar reduces the appeal of the metal as alternate source of investment.
Before these three days, gold had struck consecutive record highs for six consecutive sessions. Prices closed above the $900 mark for the first time on Monday, 14 January, 2008. Since then it has dropped by more than $20.
Comex Silver futures for March delivery rose 11.5cents (0.7%) to $16.01 an ounce. Silver has gained 7.2% in 2008. The metal had climbed 15.5% in FY 2007. The metal also has gained for seven straight years.
Gold witnessed the greatest annual gain in twenty eight years by gaining $200/ounce (31%) in FY 2007. In 2006, silver had jumped 46% while gold gained 23%.
In the currency market today, the dollar index, which tracks the value of the greenback against a basket of other major currencies, fell 0.2% to 76.1.
In the energy market today, crude oil fell to a four-week low on recession concerns and oil closed lower by 71 cents today at $90.13 barrel.
Today, Federal Reserve Chairman, Ben Bernanke reiterated that the outlook for growth in 2008 "has worsened" and "the downside risks to growth have become more pronounced." Last week he had hinted that more interest rate cuts are on the way to help the situation from worsening further.
Gold had climbed 31% in FY 2007 as lower interest rates had sent the dollar tumbling, and crude-oil prices rose to a record.
At the MCX, gold prices for February delivery closed lower by Rs 20 (0.17%) at Rs 11,162 per 10 grams. Prices rose to a high of Rs 11,263 per 10 grams and fell to a low of Rs 11,119 per 10 grams during the day’s trading.
At the MCX, silver prices for March delivery closed Rs 82 (0.4%) higher at Rs 20,636/Kg. Prices opened at Rs 20,551/kg and rose to a high of Rs 20,824/Kg during the day’s trading.
Crude ends lower
Prices continue to slip as Federal Reserve chairman predicts slowdown in economy
Crude prices once again fell today, Thursday, 17 January, 2008. Price slipped after traders once again got gripped by fears of recession. The “r” word once again came into focus after fresh comments from Federal Reserve chairman, Ben Bernanke. Yesterday, Energy Department had reported that crude stockpiles rose more than expected for the first time in nine weeks. This also led to softening of crude price.
Crude-oil futures for light sweet crude for February delivery today closed at $90.13/barrel (lower by $0.71/barrel or 0.8%) on the New York Mercantile Exchange. Prices are 73% higher than a year ago. Last week, crude prices gained $5.3 (5.4%).
Crude had ended FY 2007 substantially higher by $35 or 57%. It was crude’s biggest yearly gain in five years.
Today, Federal Reserve Chairman, Ben Bernanke reiterated that the outlook for growth in 2008 "has worsened" and "the downside risks to growth have become more pronounced." But he also said that the Fed is not forecasting a recession this year. Last week he had hinted that more interest rate cuts are on the way to help the situation from worsening further.
In Addition, the Commerce Department reported today that construction on new homes fell 14% in December to a seasonally adjusted annual rate of 1.01 million, the slowest building pace in more than 16 years.
As per yesterday’s weekly inventory report by the EIA, U.S. crude inventories rose for the first time in nine weeks, up by 4.3 million barrels to 287.1 million barrels in the week ending 11 January. U.S. crude-oil imports averaged 10.4 million barrels a day last week, up 583,000 barrels a day from the previous week. U.S. refineries operated at 87.1% of their operable capacity last week, down from the previous week's 91.3%.
Brent crude oil for March settlement today fell $0.75 (0.8%) to $88.75 on the London-based ICE Futures Europe exchange. The London benchmark rose 54% in FY 2007, the most since 1999 when prices more than doubled.
Natural gas, gasoline and heating oil – all register drop
Natural gas fell after a government report showed that U.S. inventories are probably ample for cold- weather heating needs. As per EIA, stockpiles slipped 59 billion cubic feet to 2.691 trillion cubic feet in the week ended 11 January. Gas for February delivery fell 5.2 cents (0.6%) to settle at $8.081 per million British thermal units. Gas had surged in the first two weeks of January after forecasts were revised and called for colder weather.
Against this backdrop, February reformulated gasoline lost 1.54 cents to $2.2629 a gallon, and February heating oil fell 1.49 cents to $2.5035 a gallon.
Members of the OPEC left production targets unchanged at the 5 December meeting in Abu Dhabi. The group, which produces 40% of the world's oil, will review output at a 1 February, 2008 meeting in Vienna.
At the MCX, crude oil for February delivery closed at Rs 3,529/barrel, higher by Rs 2 (0.06%) against previous day’s close. Natural gas for January delivery closed at Rs 319.4/mmtbu, higher by Rs 0.2/mmtbu (0.06%).
Reliance Power - a day before
| Sr.No. | Category | No.of shares offered/reserved | No. of shares bid for | No. of times of total meant for the category |
| 1 | Qualified Institutional Buyers (QIBs) | 136800000 | 4198353915 | 30.6897 |
| 1(a) | Foreign Institutional Investors (FIIs) | 3721311435 | ||
| 1(b) | Domestic Financial Institutions(Banks/ Financial Institutions(FIs)/ Insurance Companies) | 476389770 | ||
| 1(c) | Mutual Funds | 0 | ||
| 1(d) | Others | 652710 | ||
| 2 | Non Institutional Investors | 22800000 | 738880485 | 32.4070 |
| 2(a) | Corporates | 333823320 | ||
| 2(b) | Individuals (Other than RIIs) | 395876535 | ||
| 2(c) | Others | 9180630 | ||
| 3 | Retail Individual Investors (RIIs) | 68400000 | 617185230 | 9.0232 |
| 3(a) | Cut Off | 589292670 | ||
| 3(b) | Price Bids | 27892560 |
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