Stay light, enjoy the weekend
Turbulence is life force. It is opportunity. Let's love turbulence and use it for change.
The turbulence in the latter half of the day was more or less expected. The bulls and bears may well adopt a wait and watch approach. Next week is a shortened week (Tuesday and Wednesday will be holidays) and investors would not like to carry any heavy positions over the weekend, given that Monday mornings quite often bring in the blues. Stay light and book profits in counters that have run up too fast.
The global cues are mixed. The Dow Jones Industrial Average made a new high, rising by 0.1% while the Nasdaq gained 0.2%. Most Asian markets are in the red this morning. Japan has led the decline in regional stocks as a higher than forecast fall in consumer prices coupled with a surprising drop in industrial production fueled concerns about the world's second-largest economy. Sliding metals prices dragged mining shares lower in the region. Crude oil remains above $65 per barrel. The rollover in the F&O segment has been good, though reports suggest squaring up of some long positions for the April contracts and creation of some short positions in the May contracts. What's more, May Nifty futures yesterday ended at a discount of 15 points to the Spot Nifty.
Reliance Industries announced its results after the market closed for trading. As has been the trend in the past couple of quarters, this time too better than expected show by its refining business has managed to offset a subdued performance from the petrochemicals business. Going forward, the trend will continue to be similar for RIL, with major upsides likely from FY09 once the company kicks off the sale of gas from the KG Basin. The full effect of the new refinery being set up by RPL will kick in from FY10. What will be the contribution from the retail business is still unclear at the moment as the business is still at a nascent stage. The stock has already run up quite a bit in recent times along with the market. So, one may not see a big movement on the upside from RIL today.
FIIs were net sellers to the tune of Rs890.4mn (provisional) in the cash segment yesterday while the domestic institutions offloaded shares worth Rs1.78bn. In the F&O segment, FIIs were net buyers of Rs5.6bn yesterday. On Wednesday, FIIs were net buyers of Rs9.62bn, taking their net buying in April to $1288.6mn. Year-to-date, the net inflows from the foreign funds is now close to $3bn. Mutual Funds pumped in Rs2.59bn in the cash segment on Wednesday.
With the rupee rising past 41 against the dollar, the Indian economy has crossed the $1 trillion mark. But, Moody's says that India needs to boost productivity to meet demand and check inflation.
SEBI has barred five traders and two brokerages for alleged price manipulation in the shares of recent new listings such as Mindtree, Shree Asthavinayak Cinevision, Pyramid Saimira, Pochiraju Industries, Cambridge Technologies and Al Champdany.
US stocks gained on Thursday with the Dow Jones Industrial Average closing at a record high for the second day in a row on the back of upbeat earnings from 3M, Apple and others.
The S&P 500 Index closed flat at 1494.25. The Dow, which closed above 13,000 for the first time on Wednesday, added 15.61 points to 13,105.50. The Nasdaq Composite Index rose 6.57 points to 2554.46, supported by a rally in Apple to a record.
After the close, software giant Microsoft reported higher quarterly sales and earnings that topped estimates. The company's shares gained 5% in extended-hours trading. Microsoft should give the broader market a lift Friday morning. However, any advance could be challenged by the first-quarter GDP report, due out before the start of trading.
US light crude oil for June delivery dropped 78 cents to $65.06 a barrel on the New York Mercantile Exchange. The front-month contract was quoting 23 cents higher at $65.29 per barrel in after-hours trading in Asia.
Treasury prices slumped, raising the yield on the 10-year note to 4.69% from 4.64% late on Wednesday. In currency trading, the dollar gained against the euro and yen, rebounding after several down sessions. The greenback's strength dragged on dollar-denominated assets like gold and silver. COMEX gold for June delivery fell $9.40 to settle at $678 an ounce.
European stocks hit new six-and-half-year highs. The pan-European Dow Jones Stoxx 600 index rose 0.15% to trade at 388.40. The German DAX Xetra 30 rose 0.6% to 7,387.02 while the French CAC 40 closed just in the red at 5,944.44. The UK's FTSE 100 advanced 0.1% to 6,469.40.
Stocks in Brazil and Mexico fell on profit-taking and slipping commodity prices. In Brazil, the benchmark Ibovespa stocks index closed 608 points, or 1.2%, lower at 49,067.69, down from Wednesday's record-high close at 49,676. Mexico's stocks closed lower for a fourth consecutive session. The IPC index of 35 most-traded issues fell 101 points, or 0.3%, to 29,342.70.
Asian stocks fell this morning. The Nikkei in Tokyo was down 69 points to 17,360 while the Hang Seng in Hong Kong slumped 164 points to 20,502. The Kospi in Seoul slid 14 points to 1538 and the Straits Times in Singapore dropped 25 points to 3381.
HOW MARKET FAREDGlobal cues to dictate trend
With over 8% gains in last two weeks, the bulls slowed down today after a spectacular opening buoyed by strong global markets. However, bulls succumbed to profit taking at peaks, dragging the indices in negative territory in afternoon trades. Finally, after alternate bouts of buying & selling, NSE Nifty closed at 4177.85, adding 11 points to its previous close. While BSE 30-share Sensex added 11 points to end at 14229 after touching an intra-day peak of 14383.72 and a low of 14127.18.
HPCL, Bajaj Auto, BPCL, HLL and Tata Motors were the major gainers among the Nifty 50 stocks. While, HCL and Tisco were among the notable losers.
Earlier, indices opened higher with a huge gap taking cues from strong US market overnight with Dow Jones hitting an all-time high of 13,107, before closing at a record 13,090, up 136 points. Nasdaq added 23 points to close at 2548. Among the Indian ADRs HDFC Bank rose nearly 3% to $74.92 while ICICI Bank added 2.6% to close at $46.52. VSNL, Infosys, Satyam, Wipro and Dr.Reddy's gained between 1-2% each to $21.47, $53.59, $25.38, $16.49 and $17.40, respectively.
ABB added over 1.9% to Rs4096 after the company announced strong sets of Q1 numbers with net profit at Rs866mn (up 68.8%) and net sales at Rs13.12bn (up 63%).
Cement stocks advanced further for second trading session. India Cement was up by 2% to Rs184 and Grasim was up by over 2% to Rs2509 after the company announced impressive Q4 results with profit up 80% to Rs4.74bn, sales up 36% to Rs24.94bn.
Tech stocks closed lower after Rupee climbed for a fifth day on speculation that RBI will allow the currency to strengthen to curb inflation. Income from US constitutes around 60% for the tech companies. Rupee touched a high of 40.87 against the Dollar. Frontline stock Infosys closed flat at Rs2019, HCL Tech fell by over 2% to Rs326 and Satyam Computer was down by over 1% to Rs461.
Profit booking was seen in Real Estate and Property stocks after rallying in last two trading sessions. Parsvnath lost by over 3% to Rs326, Sobha Developers declined by over 3% to Rs889 and Nagarjuna Construction was down by 2% to Rs180.
Insider Trades:
BEML: Rakesh Jhunjhunwala on 23rd April 2007, sold 122833 & 177167 equity shares in market of BEML. Total Holding of Rakesh Jhunjhunwala and persons acting in concert after sale is 2,11,750 shares which is 0.576%.
Market Volumes:
The turnover on NSE was up by 7% to Rs118bn. BSE Capital Good index was the major gainer and gained 0.91%. BSE Auto index (up 0.75%), BSE Bank index (up 0.27%) and BSE PSU index (up 0.52%) were among the other major gainers. However, BSE Consumer Durable index lost 0.90%.
Volume Toppers:
IFCI, TTML, Nagarjuna Fertilizers, Tele Data Info, IDFC, RNRL, RPL, IBREAL, SAIL, ITC, Idea, RIL, Vijaya Bank, Ashok Leyland, NTPC, IVRCL Infra, Hindalco, Arvind Mills and PFC.
Upper Circuit:
Tanla, Swan Mills, Mirza Intern, Sujana Metal and Saregama.
Results Today:
Aptech, Bharti Airtel, Cairn India, CRISIL, Educomp, Era Constructions, Esab India, HCL Info, HCC, Jubilant Organosys and Ranbaxy.
Delivery Delight:
Bajaj Auto, Bank of India, Bharat Forge, BHEL, BPCL, Grasim Industries, HLL, HPCL, I-Flex, PNB, Ranbaxy and Siemens.
Abnormal Delivery:
Wipro, Sterling Biotech, National Aluminium Company Ltd, Godrej Consumer Products Ltd, VSNL, APIL, Crompton Greaves, Moser Baer, SRF, HCL Technologies and GlaxoSmithkline.
Stock Futures with Largest Increases in OI:
BILT, Guj Alkalies, Dr Reddy's Labs, Ultratech cement, Mangalore Refinery, OBC, Indian Hotels, i-Flex and Amtek Auto.
Stock Futures with Largest Decreases in OI:
Patni, Guj Narmada Valley, Aurobindo Pharma, BEL, Corp Bank, HPCL, IOC, Bombay Dyeing, Polaris and STAR.
Results Corner:
RIL Q4 net income (up 14%) to Rs28.5bn and sales (up 5.5%) to Rs258.95bn
Balrampur Chini Q2 profit at Rs199.7mn (down 74.8%), sales at Rs3.96bn (up 19%)
Nicholas Piramal Q4 group profit at Rs560.3mn ( 257%), net sales at Rs6.45bn (up 51.7%)
ABB Q1 net profit at Rs866mn (up 68.8%), net sales at Rs13.12bn (up 63%)
Marico Q4 profit (up 17%) to Rs281.2mn and sales (up 33%) to Rs3.97bn
Wockhardt Q1 profit rises to Rs663mn from a loss of Rs37mn, revenues (up 48%) to Rs5.25bn
Brokers Recommendation:
IDEA – Buy from CLSA with target of Rs126
Long Term investment:
HPCL
Major News Headlines
Moody's says classic signs of overheating in India; must boost production to curb overheating
Liberty Shoes plans to raise funds by selling securities
Ranbaxy gets final USFDA approval to manufacture & market Zolpidem Tablets
Dr Reddy's signs pact with Alchemia for Herapin - Reports
Opto Circuits to buy Devon Innovations and Ormed Chemical
Tata Tea buys Vitax & Flosana Trademarks in Poland
Hindalco bids for majority stake in Bosnian Smelter - Reports.