Taj GVK Hotels
Friday, August 01, 2008
Led by buying in JP Associates and SBI, the Sensex recovered smartly in afternoon and ended firm at 14,657.
The market wiped out losses of over 323 points incurred in the first half after a strong bout of buying led by JP Associates, SBI and HDFC triggered wide-spread buying.
In a highly volatile session, the Sensex resumed 292 points lower at 14,064 following weakness in Asian indices and crashed to the day's low of 14,033 on relentless selling. While the market was on a recovery path thereafter, the Sensex witnessed a sharp turnaround in afternoon as gains in heavyweights, capital goods (CG), power and PSU stocks propelled it to an intra-day high of 14,682. After gyrating over 600 points during the intra-day trades, the Sensex gained 301 points to close at 14,657, while the Nifty ended 81 points higher at 4,414.
However, the market breadth was positive. Of the 2,732 stocks traded on the BSE 1,551 stocks advanced, 1,108 stocks declined and 73 stocks ended unchanged.
The BSE CG index led the pack and gained 3.84% followed by the BSE Power index (up 3.40%), the BSE PSU index (up 3.27%), the BSE Oil & Gas index (up 3.26%) and the BSE Bankex (up 3.26%). The BSE Auto & FMCG indexes closed with marginal losses.
JP Associates was the star performer among the heavyweights and the stock soared 8.67% at Rs170.45. Among the other major gainers, SBI advanced 6.05% at Rs1,500.30, HDFC jumped 5.51% at Rs2,402.20, Reliance Infra rose 4.71% at Rs1,010.60, BHEL moved up by 4.61% at Rs1,756.50, Reliance Industries advanced 4.24% at Rs2,299.75, Wipro gained 3.99% at Rs432.60 and Tata Steel added 3.67% at Rs176.70. However, Reliance Communications was down by 12.65% followed by Tata Power, Maruti Suzuki India, Hindustan Unilever, ACC, Tata Motors, Hindalco and ITC- all inched lower.
CG stocks were in demand and scaled higher. Suzlon Energy soared 7.14% at Rs238.70, Kalpataru flared up 6.35% at Rs805.60, Crompton Greaves added 5.56% at Rs249.75, Siemens gained 5.28% at Rs575.60, Punj Lloyd and BHEL was up 4.61% at Rs1,756.50.
Over 3.78 crore Reliance Natural Resources shares changed hands on the BSE followed by IFCI (2.28 crore shares), Ispat Industries (2.04 crore shares), Cybermate (2.02 crore shares), Reliance Communications (1.44crore shares) and Nagarjuna Fertilisers (1.07 crore shares).
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
1/8/2008 532816 BROADCAST MERRILL LYNCH CAPITAL MARKET ESPANA S A SVB S 130000 34.00
1/8/2008 532271 CYBERMAT INF PARSHURAM SHIVAJI CHAUDHARY B 1084297 4.63
1/8/2008 532271 CYBERMAT INF ANGEL INFIN PRIVATE LIMITED B 640074 5.05
1/8/2008 532271 CYBERMAT INF HEMA A SONECHA B 500000 5.26
1/8/2008 532271 CYBERMAT INF PARSHURAM SHIVAJI CHAUDHARY S 1084297 4.57
1/8/2008 532271 CYBERMAT INF BASMATI SECURITIES PVT LTD S 927473 4.51
1/8/2008 532271 CYBERMAT INF ANGEL INFIN PRIVATE LIMITED S 600074 5.26
1/8/2008 500163 GODFREY PHIP MAVI INVESTMENT FUND LTD B 56000 1534.78
1/8/2008 500163 GODFREY PHIP SPIN INVESTMENT INDIA LTD S 56000 1533.98
1/8/2008 532836 GREMAC INFRA HEMENDRA R SHAH S 100001 88.12
1/8/2008 513337 GUJ.TOOLROOM REKHABEN J DESAI B 120000 9.99
1/8/2008 513337 GUJ.TOOLROOM NEHALBEN N VYAS B 122500 10.00
1/8/2008 513337 GUJ.TOOLROOM MALABEN P MISTRY B 120000 10.00
1/8/2008 513337 GUJ.TOOLROOM KINARIWLAL TEXTILE PRODUCTS P LTD S 291700 10.00
1/8/2008 513337 GUJ.TOOLROOM SAURABH N KINARIWLAL S 22900 10.00
1/8/2008 513337 GUJ.TOOLROOM SIDDHARTHA S KINARIWLAL S 45100 10.00
1/8/2008 523844 INVICTA MED PADAM JAWARILAL CHALLANI S 34515 16.40
1/8/2008 532283 KASHYAP TEC OM EDUCATION IT PVT LTD B 2998079 1.41
1/8/2008 532283 KASHYAP TEC OM EDUCATION IT PVT LTD S 2998079 1.42
1/8/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD B 117976 20.94
1/8/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD S 33201 21.00
1/8/2008 524522 LAFAN PETROC RAKHI TRADING PRIVATE LIMITED S 49910 16.48
1/8/2008 532884 REFEX REFRIG HIMAT PURSHOTTAMBHAI JATANIA B 170000 259.77
1/8/2008 532886 SEL MANUF B K SHAH CO B 165813 692.52
1/8/2008 532886 SEL MANUF B K SHAH CO S 165821 692.21
1/8/2008 512167 YASHRAJ SECR ROSY INVESTMENT CONS PVT LTD S 275000 8.35
1/8/2008 512167 YASHRAJ SECR GLORY INVESTMENT SERVICES P L S 275000 8.42
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
01-AUG-2008,AHMEDFORGE,Ahmednagar Forgings Ltd,SUCON INDIA (P) LTD,BUY,284668,106.38,-
01-AUG-2008,CHAMBLFERT,Chambal Fertilizers Ltd.,PACE FINANCIAL SERVICES,BUY,2157759,77.45,-
01-AUG-2008,GOLDTECH,Goldstone Tech Ltd.,LAXMA REDDY BANDARI,BUY,240000,113.90,-
01-AUG-2008,ISPATIND,Ispat Industries Limited,JAYPEE CAPITAL SERVICES LTD.,BUY,11533320,26.96,-
01-AUG-2008,LGBFORGE,LGB Forge Limited,TRANSGLOBAL SECURITIES LTD.,BUY,499071,5.63,-
01-AUG-2008,SB&TINTL,SB&T International Ltd,SETU SECURITIES LTD,BUY,97250,16.47,-
01-AUG-2008,SELMCL,SEL Manufacturing Company,B K SHAH CO KETAN BHAILAL SHAH,BUY,187080,693.79,-
01-AUG-2008,SELMCL,SEL Manufacturing Company,DKG SECURITIES PVT LTD.,BUY,71028,700.66,-
01-AUG-2008,SIMPLEX,Simplex Projects Limited,SANTOSH INDUSTRIES LIMITED,BUY,100000,195.00,-
01-AUG-2008,AHMEDFORGE,Ahmednagar Forgings Ltd,SUCON INDIA (P) LTD,SELL,280880,106.17,-
01-AUG-2008,BALRAMCHIN,Balrampur Chini Mills,MORGAN STANLEY MAURITIUS COMPANY LTD,SELL,1400000,86.46,-
01-AUG-2008,CHAMBLFERT,Chambal Fertilizers Ltd.,PACE FINANCIAL SERVICES,SELL,2157760,77.64,-
01-AUG-2008,DWARKESH,Dwarikesh Sugar Industrie,SBI MUTUAL FUND,SELL,98500,73.81,-
01-AUG-2008,GOLDTECH,Goldstone Tech Ltd.,MADHUKAR CHIMANLAL SHETH,SELL,200000,113.90,-
01-AUG-2008,ISPATIND,Ispat Industries Limited,JAYPEE CAPITAL SERVICES LTD.,SELL,11429318,27.01,-
01-AUG-2008,LGBFORGE,LGB Forge Limited,TRANSGLOBAL SECURITIES LTD.,SELL,503279,5.63,-
01-AUG-2008,RENUKA,Shree Renuka Sugars Limit,MORGAN STANLEY INVESTMENTS MAURITIUS LIMITED,SELL,1465000,126.71,-
01-AUG-2008,SB&TINTL,SB&T International Ltd,SETU SECURITIES LTD,SELL,24918,16.95,-
01-AUG-2008,SELMCL,SEL Manufacturing Company,B K SHAH CO KETAN BHAILAL SHAH,SELL,186973,694.06,-
01-AUG-2008,SELMCL,SEL Manufacturing Company,DKG SECURITIES PVT LTD.,SELL,101028,687.16,-
01-AUG-2008,SIMPLEX,Simplex Projects Limited,LATA BHANSHALI,SELL,100000,195.00,-
Reliance Communications, DLF, Tata Steel, Suzlon Energy, Nalco, Nestle, JSW Steel, MTNL, Titan Industries, Indian Overseas Bank, Corporation Bank
Reliance Communications, DLF, Tata Steel, Suzlon Energy, Nalco, Nestle, JSW Steel, MTNL, Titan Industries, Indian Overseas Bank, Corporation Bank, Castrol, HT Media, Andhra Bank, AIA Engineering, Maharastra Seamless, Rajesh Exports, Radico Khaitan
With the Q1 June 2008 earnings season over, there is lack of any major near term trigger for the domestic bourses. The market will now closely watch movement in crude oil prices and global stock markets. A further slide in oil price may boost investor confidence in the short term. On Thursday, 31 July 2008, the front-month US crude oil contract settled at $124.08, down $2.69 for the day and off sharply from a record above $147 a barrel on 11 July 2008.
The highly volatile July 2008 series of derivative contracts expired on Thursday, 31 July 2008 with poor rollovers. As per reports, Nifty rollover of positions from July 2008 series to August 2008 series stood at 65.05% as compared to 70.07% in the previous series. Even in single stock futures, rollovers were relatively muted at 79.19% compared to 82.05% in the previous series.
Marketmen will be keenly watching the International Atomic Energy Agency (IAEA) meet, scheduled on Friday, 1 August 2008 to consider the India-specific safeguards agreement, which will be a key step for the operationalisation of the Indo-United States nuclear deal. If the deal moves ahead, it could boosts power and capital goods sector stocks.
Stubbornly high inflation still remains a concern. The wholesale price index rose 11.98% in the 12 months to 19 July 2008, above the previous week's reading of 11.89%. The Reserve Bank of India (RBI) hiked repo rate by 50 basis points (bsp) and cash reserve ratio (CRR) by 25 bps at its quarterly policy review on Tuesday, 29 July 2008. Repo rate has now reached 9%, a level last seen in October 2000. CRR is also at 9%, for the first time since November 1999.
In the near term, the market trend is likely to dictated by the progress of the monsoon. India's annual monsoon rains from 17 to 23 July were 33% below the long-term average, the Indian Meteorological Department. Rainfall since 1 June 2008 has been 2% below the same average.
Stocks of the public sector units will continue to remain in focus as there are expectations that the government may push forward some economic reforms, which were stalled over the past four years due to opposition from Left parties. Left parities had stalled privatisation of state-run firms, pension reforms, higher foreign limits in insurance and more liberal norms for foreign bank.
Some analysts, however, feel that a major big-bang push to reforms is unlikely as the government will focus primarily on bringing down inflation ahead of key state polls and parliamentary elections, which are due in May 2009.
Foreign institutional investors (FIIs) sold shares worth Rs 1836.80 crore in the month of July 2008. FIIs sold shares worth Rs 26705.10 crore in the calendar year 2008. Mutual funds have bought shares worth Rs 1223.50 crore in the month of July 2008, till 30 July 2008.
In a sudden reversal of fortunes, the market moved higher shrugging off rate hike by the Reserve Bank of India on Tuesday, 29 July 2008. Strong bounce back in global markets and further decline in oil prices were the key factors that revitalized the investor sentiments during the week.
The 30-shares BSE Sensex rose 381.75 points or 2.67% to 14,656.69 in the week ended 1 August 2008. The CNX S&P Nifty rose 101.7 points or 2.35% to 4413.55.
The BSE Mid-Cap index rose 70.15 points or 1.26% to 5,642.74 and the BSE Small-Cap index rose 201.32 points or 2.96% to 6,980.10.
The wholesale price index rose 11.98% in 12 months to 19 July 2008, above the previous week's annual rise of 11.89%. Inflation for the week ended 24 May 2008 was revised upwards to 8.9% from 8.24%.
Foreign institutional investors (FIIs) sold shares worth Rs 1836.80 crore in the month of July 2008. FIIs sold shares worth Rs 26705.10 crore in the calendar year 2008. Mutual funds have bought shares worth Rs 1223.50 crore in the month of July 2008, till 30 July 2008.
The key benchmark indices scored marginal gains on 28 July 2008. However, trade was cautious ahead of the Reserve Bank’s monetary policy review scheduled on 29 July 2008. The 30-share BSE Sensex gained 74.17 points or 0.52% higher at 14,349.11. The broader based S&P CNX Nifty rose 20.25 points or 0.47% at 4,332.10.
The key benchmark indices slumped sharply on 29 July 2008 after the Reserve Bank of India (RBI) on that day raised cash reserve ratio (CRR) by 25 basis points and repo rate by 50 basis points at its quarterly monetary policy review. The 30 share BSE Sensex plunged 557.57 points or 3.89% at 13,791.54. The broader based S&P CNX Nifty was down 142.25 points or 3.28% at 4,189.85.
Rally in global equities and fall in oil prices aided a rebound on the domestic bourses on 30 July 2008. The 30-share BSE Sensex jumped 495.67 points or 3.59% at 14,287.21. The broader based S&P CNX Nifty jumped 123.70 points or 2.95% at 4,313.55.
On 31 July 2008, the key benchmark indices extended previous session’s sharp gains ending marginally higher amidst volatility as futures & options contracts for July 2008 series expired on that day. The 30-share BSE Sensex rose 68.54 points or 0.48% at 14,355.75. The broader based S&P CNX Nifty was up 19.40 points or 0.45% to 4,332.95.
On Friday, 1 August 2008, the market which had opened weak on subdued global cues completely changed the course, ending near day's high. The rally gathered steam in late trade after United Nations nuclear watchdog chief Mohamed ElBaradei said a basic inspection plan for India met all safeguards standards. Members of IAEA's board of governors will be voting on the India-specific nuclear safeguard agreement, a key step in operationalisation of Indo-US nuclear deal. The 30 share BSE Sensex surged 300.94 points or 2.10% at 14,656.69. The broader based S&P CNX Nifty rose 80.6 points or 1.86% at 4413.55.
India’s second largest listed telecom service provider by sales Reliance Communications tanked 13.18% to Rs 436.80 in the week after the reported the slowest profit growth in nine quarters. RCom reported 23.9% growth in consolidated net profit to Rs 1512 crore on 23.7% growth in revenue to Rs 5322 crore in Q1 June 2008 over Q1 June 2007.
India’s largest private sector firm by market capitalization and oil refiner Reliance Industries rose 7.10% to Rs 2299.75 in the week.
India’s largest private sector bank by market capitalization ICICI Bank fell 2.25% to Rs 642.10. The bank’s net profit declined 6.1% to Rs 728.01 crore on a 1.6% growth in operating income to Rs 9429.98 crore in Q1 June 2008 over Q1 June 2007. Treasury losses and slower growth in advances have taken a toll on ICICI Bank’s profits for the first quarter of the current financial year.
Tata Motors, the country’s top truck manufacturer in terms of sales lost 6.57% to Rs 398.60. The company reported 30.10% fall in net profit to Rs 326.11 crore on 14.40% rise in net sales to Rs 6928.44 crore in Q1 June 2008 over Q1 June 2007.
India’s largest cigarette maker in terms of sales ITC fell 0.56% to Rs 187.70. The company reported 4% drop in net profit at Rs 748.67 crore on 18% growth in net turnover to Rs 3,900 crore in Q1 June 2008 over Q1 June 2007. The drop in net profit was attributed to the increase in excise duties on non-filter cigarettes in the Union Budget 2008, steep rise in commodity prices and store rentals.
India’s largest tractor maker by sales Mahindra & Mahindra fell 3.06% to Rs 523.70. The company’s net profit fell 16.66% to Rs 159.3 crore on 25.99% rise in total income to Rs 3331.8 crore in Q1 June 2008 over Q1 June 2007. The company's board approved acquisition of all the business assets of Kinetic Motor Company (KMCL), a two-wheeler company for Rs 110 crore.
Power generation major NTPC fell 5.76% to Rs 176.70. On Tuesday, 29 July 2008, NTPC reported 27.1% fall in net to Rs 1726.53 crore on 5.87% growth in total income to Rs 10256.70 crore in Q1 June 2008 over Q1 June 2007.
India’s largest state run oil exploration firm by sales ONGC rose 1.41% to Rs 996.85. ONGC reported 44% surge in net profit to Rs 6636 crore on 47% growth in turnover to Rs 20,123 crore in Q1 June 2008 over Q1 June 2007. The company attributed the strong performance to higher price realization on crude oil and cost management.
India’s largest drug maker by sales Ranbaxy Laboratories jumped 5.92% to Rs 509.75. The company reported 0.25% rise in consolidated net profit to Rs 160.80 crore on 13% rise in consolidated sales to Rs 1829.60 crore in Q2 June 2008 over Q2 June 2008.
In a move to curtail surging inflation and inflationary pressures, the Reserve Bank of India (RBI) on 29 July 2008 tightened the liquidity in the system by raising the Cash Reserve Ratio (CRR) of banks by 25 basis points to 9% and the short-term indicative rate viz. the repo rate by 50 basis points to 9%.
The increase in CRR - the portion of deposits banks must keep aside - with effect from 30 August 2008 is expected to suck out another Rs 9,000 crore from the banking system. Repo rate is the rate at which the RBI lends money to banks. The RBI also revised the GDP growth projection for 2008-09 to around 8%, from earlier 8% to 8.5%.
Exports rose 23.5% in June 2008 from a year earlier to $14.66 billion. That helped narrow the trade deficit from May 2008 to $9.79 billion. Imports were up by 25.9% to $24.45 billion in June 2008 from a year earlier. Oil imports rose 53.4% to $9.03 billion.
Telecom minister A Raja on 1 August 2008 said the government will hold a global auction for high-speed third-generation (3G) mobile services and have five operators initially. India has 60 MHz of 3G spectrum available, and will allow both GSM and CDMA 3G services, he said.
The market extended a recovery witnessed recently, with the Sensex surging 865.15 points in the last three trading sessions. The market, which had opened weak on subdued global cues completely changed the course, ending near the day's high today. The rally gathered steam in late trade after United Nations nuclear watchdog chief Mohamed ElBaradei today said a basic inspection plan for India met all safeguards standards. Members of International Atomic Energy Agency's (IAEA) board of governors will be voting on the India-specific nuclear safeguard agreement, a key step in operationalisation of the Indo-US nuclear deal.
Index heavyweight Reliance Industries surged. Oil & gas, capital goods, power stocks gained. Jaipraksh Associates gained more than 8.5%. State Bank of India and HDFC jumped more than 5.5% each. Bharat Heavy Electricals and Reliance Infrastructure surged more than 4.5% each.
Reliance Communications (RCom) dipped more than 12% on disappointing Q1 results. The market breadth turned positive from earlier weak breadth.
Finance Minister P Chidambaram today said interest rates may moderate in six to 12 months. A number of public sector and private sector banks have raised lending rates and deposit rates after the Reserve Bank of India, early this week, raised repo rate by 50 basis points to 9% and cash reserve ratio by 25 basis points to 9%, at its quarterly policy review.
Telecom minister A Raja today said the government will hold a global auction for high-speed third-generation (3G) mobile services and have five operators initially. India has 60 MHz of 3G spectrum available, and will allow both GSM and CDMA 3G services, he said.
The 30-share BSE Sensex jumped 300.94 points or 2.1% at 14,656.69. Sensex rose 326.58 points at the day's high of 14,682.33 hit in late trade. At the day’s low of 14,032.87, the Sensex lost 322.88 points in early trade. The initial sharp fall was due to weak global cues.
The barometer index BSE Sensex is down 5,630.3 points or 27.75% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 6,550.08 points or 30.88% away from its all-time high of 21,206.77 struck on 10 January 2008.
The broader based S&P CNX Nifty was up 80.6 points or 1.86% at 4,413.55. Nifty August 2008 futures were at 4435, at a premium of 21.45 points as compared to spot closing of 4413.55.
The BSE clocked the turnover of Rs 6725 crore today as compared to Rs 5,091.04 crore on Thursday, 31 July 2008. NSE's futures & options (F&O) segment turnover was Rs 48,778.01 crore, which was lower than Rs 64,640.25 crore on Thursday, 31 July 2008.
The market breadth turned positive compared to weak breadth earlier in the day. 1,551 shares advanced on BSE as compared to 1108 that declined. 73 remained unchanged.
Among the 30-member Sensex pack, 22 gained while the rest declined.
The BSE Mid-Cap index rose 1.35% to 5,642.74 and BSE Small-Cap index rose 0.97% to 6,980.10. Both these indices underperformed Sensex.
BSE Capital Goods index (up 3.84% to 12,132), Power index (up 3.4% to 2,661.75), BSE PSU index (up 3.27% to 6,925.52), BSE Oil & Gas (up 3.26% to 10,047.86), BSE Bankex (up 3.26% to 6,728.56), BSE IT index (up 2.99% to 3,800.06), BSE Metal index (up 2.62% to 13,250.31), BSE BSE Realty index (up 2.37% to 5,199.20) outperformed Sensex.
BSE FMCG index (down 0.8% to 2,121.96), BSE Auto index (down 0.63% to 3,656.49), BSE Teck index (up 0.63% to 3,019.32), BSE HealthCare (up 0.69% to 4,190.84), BSE Consumer Durables index (up 0.71% to 3,712.19), underperformed Sensex.
India’s largest private sector firm by market capitalization and oil refiner Reliance Industries (RIL) rose 4.24% to Rs 2,299.75. It recovered from session’s low of Rs 2,160.
PSU banks rose. Indian Bank (up 8.39% to Rs 104.05), Bank of Baroda (up 7.98% to Rs 275.90), State Bank of India (up 6.05% to Rs 1,500.30), Punjab National Bank (up 7.16% to Rs 483.55), IDBI Bank (up 5.27% to Rs 78.90), Bank of India (up 6.17% to Rs 288.25), Canara Bank (up 7.07% to Rs 196.75) edged higher.
Union finance minister P Chidambaram on Thursday said the government will carry out all reform measures that do not require parliamentary approval. At the same time, he asserted that the three overarching bills for financial sector reforms—the Banking Regulation (Amendment) Bill, 2005; the Insurance Bill seeking to raise the foreign direct investment (FDI) cap from 26% to 49% and the Pension Fund Regulatory and Development Authority Bill, 2005—would be passed by Parliament within the government’s term.
Capital goods stocks rose. Larsen & Toubro (up 3.45% to Rs 2,692.40) , Bharat Heavy Electricals (up 4.61% to Rs 1,756.50) and Suzlon Energy (up 7.14% to Rs 238.70) edged higher.
Power stocks rose ahead of the IAEA meet. Reliance Infrastructure (up 4.71% to Rs 1,010.60), PowerGrid Corporation of India (up 2.85% to Rs 97.45), NTPC (up 3.67% to Rs 176.70), Reliance Power (up 2.78% to Rs 169.90) edged higher.
OiI & gas stocks rose. BPCL (up 2.28% to Rs 334.75), HPCL (up 2.05% to Rs 224.45), Indian Oil Corporation (up 3.38% to Rs 416.90), Reliance Petroleum (up 2.58% to Rs 168.95), ONGC (up 0.08% to Rs 996.85) edged higher. On Thursday, 31 July 2008, the front-month US crude oil contract settled at $124.08, down $2.69 for the day and off sharply from a record above $147 a barrel on 11 July 2008.
The world’s sixth largest steel maker Tata Steel rose 3.92% to Rs 680.65. It recovered from its lows of Rs 635. On the back of higher prices and strong volume growth, Tata Steel on Thursday reported 22% growth in net profit to Rs 1488 crore on 46% growth in net sales to Rs 6165 crore in Q1 June 2008 over Q1 June 2007. The company said the profitability was impacted by an exchange loss of Rs 303.40 crore on its overseas bonds due to fall in rupee against the dollar.
India's largest-listed realty firm, DLF declined 2.13% to Rs 520.15. It recovered from session’s lows of Rs 480. On Thursday it reported 23% growth in consolidated net profit to Rs 1864 crore on 23.2% growth in total revenue to Rs 3846 crore in Q1 June 2008 over Q1 June 2007. Unitech (down 0.64% to Rs 162.50) and Indiabulls Real Estate (down 1.24% to Rs 282.50) edged lower.
India’s largest car maker by sales Maruti Suzuki India fell 2.5% to Rs 560.50 on reporting 1.09% rise in vehicle sales to 58,543 units in July 2008 over July 2007.
India’s largest private secor bank by net profit ICICI Bank rose 1.14% to Rs 642.10. It recovered from session's low of Rs 610. ICICI Bank on Thursday said it has hiked lending and deposit rates.
India’s largest dedicated mortgage firm by operating income HDFC rose 5.51% to Rs 2,402.50. It recovered from session’s lows of Rs 2,195.On Thursday, 31 July 2008, HDFC said it has hiked its floating interest rates on home loans for both existing and new customers with effect from Friday, 1 August 2008.
India’s second largest telecom services provider by sales Reliance Communications fell 12.65% to Rs 436.80. On Thursday it reported 23.9% growth in consolidated net profit to Rs 1512 crore on 23.7% growth in revenue to Rs 5322 crore in Q1 June 2008 over Q1 June 2007. This is the slowest profit growth for the company in nine quarters.
Tata Power Company (down 3.76% to Rs 1,116.50), Hindustan Unilever (down 1.9% to Rs 235.15), ACC (down 1.33% to Rs 576.50), ITC (down 0.05% to Rs 187.70), edged lower from the Sensex pack.
Jaiprakash Associates (up 8.67% to Rs 170.45), Wipro (up 3.99% to Rs 432.60), Infosys (up 3.59% to Rs 1,640.10), Satyam Computer Services (up 2.85% to Rs 391.15) edged higher form Sensex pack.
Reliance Natural Resources clocked the highest volume of 3.78 crore shares on BSE. IFCI (2.28 crore shares), Ispat Industries (2.04 crore shares), Cybermat Infotek (2.02 crore shares) and Reliance Communications (1.44 crore shares) were the other volume toppers in that order.
Reliance Communications clocked the highest turnover of Rs 631.04 crore on BSE. Reliance Natural Resources (Rs 375.37 crore), Reliance Capital (Rs 347.75 crore), Reliance Industries (Rs 297.09 crore) and Larsen & Toubro (Rs 186.91 crore) were the other turnover toppers in that order.
The wholesale price index rose 11.98% in the 12 months to 19 July 2008, above the previous week's reading of 11.89%, data released after market hours yesterday, 31 July 2008 showed.
European markets opened weak France’s CAC 40, Germany’s DAX and UK’s FTSE 100 fell between 0.34% to 0.94%.
Asian markets were trading mixed after weak start today, 1 August 2008. Japan's Nikkei, Taiwan's Taiwan Weighted, Singapore's Straits Times, and South Korea's Seoul Composite fell between 0.31% to 2.11%. China's Shanghai Composite rose 1.33% while Hong Kong's Hang Seng rose 0.58%.
US markets tumbled yesterday, 31 July 2008 after disappointing economic data dampened sentiment. Federal Reserve Chairman Alan Greenspan's statement that a slowing global economy may push the United States into recession and that US housing market crisis is nowhere near the bottom added to the bearish mood. The Dow plunged 205.67 points, or 1.78%, to 11,378.02. The Standard & Poor's 500 index declined 16.88 points, or 1.31%, to 1,267.38, while the Nasdaq lost 4.17 points, or 0.18%, to 2,325.55.
Market Grape Wine :
In House :
Nifty at a support of 4256 and 4185 with resistance at 4355 and 4400.
Cash: Buy ICICI BANK above 636 target 670 with S/L 620.
Cash: Buy RELIANCE above 2170 target 2225 with S/L 2140.
Future: Sell RNRL below 98 targets 90 with S/L 102.
Markets at a support of 14114 & 13939 levels with resistance at 14391 & 14491 levels .
Buy : INFY at dips
Buy : Adalbs at dips
Buy : SesaGoa at dips
Buy : Nalco & TataComm
Buy : LNT at dips
Buy : IBulls at dips
Buy : Aftekinfo bullet with medium term prespective
Buy : Core project
Dark Horse : Aftek , Sesa Goa , IBulls , RIL , Adalbs , SBIN , Core & INFY
TGIF : Thank God Its Friday : markets consolidating buy at dips with medium term prespective .
The Indian Market is expected to have negative opening due to weak global cues as US markets closed in red and Asian markets are trading lower. Thursday, the Indian market managed to close with gains after showing volatility during the trading session. The domestic market opened on positive but soon turned volatile ahead of F&O expiry day and inflation number for the week ended 19th July 2008. Further it was not able to gain the momentum and was skipping up and down. At the end, market managed to close in green due to some buying in key indices during final hours of trading. NSE Nifty maintained the level of 4,300 and BSE Sensex maintained 14,300 level. On the sectoral front, Metal, Oil & Gas, Capital Goods and Reality stocks gained favor from the market as witnessed buying from these baskets. However, Pharma, IT and Reality stocks observed selling pressure. The BSE Sensex closed higher by 68.54 points at 14,355.75 and NSE Nifty ended up by 19.40 points at 4,332.95. We expect that market may trade lower with negative bias during the trading session.
Inflation for the week ended 19th July 2008, stood at 11.98% in comparison to 11.89% of previous week. This increase is mainly due to higher prices of some food articles and manufacturing products.
On Thursday, the US market was closed in red after weak readings on economic growth and the job market data. According to a commerce department''s report, gross domestic product grew by 1.9% in the second quarter. Investors were also worried due to Labor Department’s data saying that the number of people seeking jobless benefits jumped to the highest level in five years. The number of U.S. workers filing new claims for jobless benefits jumped 44,000 last week, above the Wall Street consensus.
The Dow Jones Industrial Average (DJIA) closed lower by 205.67 points at 11,378.02 along with S&P 500 index ended down by 16.88 points at 1,267.38 and NASDAQ closed lower by 4.17 points at 2,325.55.
Indian ADRs ended down. In technology sector, Wipro ended higher by (1.08%) along with Infosys by (0.69%), while Satyam closed down by (1.61%) and Patni Computers dropped by (0.67%). In banking sector, HDFC bank and ICICI bank lost (2.51%) and (0.90%) respectively. In telecommunication sector, MTNL and Tata Communication ended down by (3.71%) and (2.71%). Sterlite industries decreased by (2.92%).
Today the major stock markets in Asia are trading weak on weak US economic data. Hang Seng index is trading down by 351.15 points at 22,379.95 along with Japan’s Nikkei trading lower by 295.88 points at 13,080.93. Taiwan Weighted is trading at 6,919.13 down by 104.93 points.
The FIIs on Thursday stood as net seller in equity. The gross equity purchased was Rs2,464.60 Crore and the gross debt purchased was Rs0.00 Crore while the gross equity sold stood at Rs2,855.90 Crore and gross debt sold stood at Rs0.00 Crore. Therefore, the net investment of equity reported was (Rs391.90) Crore and net debt was Rs0.00 Crore.
Today, Nifty has support at 4,146 and resistance at 4,398 and BSE Sensex has support at 13,858 and resistance at 14,642.
Nifty (4333) Sup 4250 Res 4370
Sell ICICI Bank (637) SL 644 Target 625, 620
Sell NDTV (387) SL 392 Target 377, 375
Sell APIL (407) SL 412 Target 397, 395
Buy Rel Cap (1301) SL 1285 Target 1330, 1340
Buy Tata Steel (655) SL 648 Target 668, 672
People (Anil Ambani) do not have power plant and I (RIL) do not have gas and I am asked to sign a contract to supply gas? - (RIL's counsel in court on Thursday)
Sometimes we wonder, whether we too get into contracts without substance or conviction. We are so used to the RNRL-RIL case getting postponed that we hardly discuss it. Had it been good times one can imagine how precisely inflated projections would be available on the abundant supply of gas and unending demand for power (though the latter remains true). The markets too are lacking supply of fresh gas. With inflation almost at 12% for week ended July 19, 2008, demand for most things is less except for power! Literally.
After a July jalsa, especially towards the end, the bulls flattened to deceive at expiry.
Thanks to inflation numbers coming a day earlier, we think market participants can slowly start relaxing from Friday afternoon itself. All your joys and sorrows can be best left for Monday mornings.
The outlook for the day is a weak opening. Thereafter, do not expect any strong buying to emerge overall. Stock specific action will continue especially on news-driven counters and companies announcing results.
Reacting to the latest RBI move, ICICI Bank and HDFC raised interest rates by 75bps.
Steel companies may be a mixed bag. While SAIL could see pressure after the ministry has asked it not to raise prices, Tata Steel may see some resilience after its Q1 profit rose 22%.
With new changes in the Nifty coming in next month, reports say brokerages may trim Sensex targets as the P/E ratio goes up. This is due to new entrants like Reliance Power who’s profitability is much lower than a Dr. Reddy’s which is leaving the Nifty. At the same time the market cap of R-Power is around Rs370bn as against Dr.Reddy’s market cap which is in the range of Rs10bn. The low profit of R-Power makes the Nifty expensive, a report added.
The oil rally has thankfully halted. But that appears more on the back of a battered US economy. Despite supply concerns, light, sweet crude oil for September delivery fell $2.69 to settle at $124.08 on the New York Mercantile Exchange. Thursday's economic data came in much weaker than forecast.
The economy grew at a 1.9% annual rate from April through June. This was below expectations especially because US gross domestic product got a boost from $90bn in stimulus checks in the previous quarter. Initial jobless claims rose to their highest level in five years last week.
Asian stocks are looking weak expectedly after the US markets ended in the red. Moreover, Sumitomo Mitsui Financial Group Inc., Suncorp-Metway Ltd. and NEC Corp. reported more than a dip in profit.
Japan's Nikkei 225 Stock Average fell almost 2% in early hours. Mazda Motor Corp. and Suzuki Motor Corp are also trading weak after its first-quarter profit fell on account of a stronger yen and higher raw-material costs.
US indices came tumbling down with the Dow Jones down 206 points, or 1.8% lower. The broader Standard & Poor's 500 index closed 1.3% lower. The Nasdaq composite fell marginally by 0.2%. The losses were pared by Motorola earnings, which beat the street and some positive news from the biotech sector.
The dollar fell against the euro and the Japanese yen. COMEX gold for December delivery rose $10.40 to $922.70.
The market will now closely watch if Federal Reserve Chairman Ben Bernanke leaves interest rates unchanged on August 5. Expectations are the weakness in the economy will prevent the Fed from raising interest rates.
Last trading session of the month and the F&O series ended on a flat note. It was an absolute lackluster trading session as traders and investors turned cautious ahead of the inflation figures.
Wednesday’s gains spilled over briefly in the opening trades. However, with F&O expiry, markets turned choppy and were struggling for direction throughout the trading session. As expected, volatility was order of the day, however the ups and downs were witnessed in a narrow range.
Finally, the benchmark Sensex ended 68 points higher to close at 14,355 and Nifty ended flat at 4,332.
Among the 30-components of Sensex, 16 stocks were in green and 13 stocks were in red. Reliance Industries, Tata Steel, SBI and Tata Power were among the major gainers. On the other hand, Infosys, Bharti and Grasim were among the major losers.
Federal Bank slipped by 2.8% to Rs191. The company announced its Q1 results with net profit of Rs681.5mn (up 1.7%) for the quarter ended June 30, 2008 as compared to Rs669.4mn.
Total Income increased to Rs8,413.3mn (up 27.5%) for the quarter ended June 30, 2008 from Rs6,597mn. The scrip touched an intra-day high of Rs199 and a low of Rs190 and recorded volumes of over 34,00,000 shares on BSE.
Yes Bank ended flat at Rs127 after the company announced its Q1 results with net profit of Rs543.3mn (up 50%) for the quarter ended June 30, 2008 as compared to Rs360mn.
Total Income increased from Rs3,484.9mn for the quarter ended June 30, 2007 to Rs4,861.9mn for the quarter ended June 30, 2008. The bank also announced that it would raise Prime Lending rate by 50bps effective Aug 1. The scrip touched an intra-day high of Rs131 and a low of Rs125 and recorded volumes of over 7,00,000 shares on BSE.
Central Bank of India ended 3% lower to close at Rs57 after the company announced its Q1 results with net profit declining by 39.6% at Rs593.2mn for the quarter ended June 30, 2008 as compared to Rs983.5mn.
Total Income increased from Rs18,740.2mn for the quarter ended June 30, 2007 to Rs25,725.3mn for the quarter ended June 30, 2008. The scrip touched an intra-day high of Rs60 and a low of Rs57 and recorded volumes of over 1,00,000 shares on BSE.
Bharat Forge surged by over 5% to Rs255. The company announced its Q1 results with net profit after tax of Rs265.6mn for the quarter ended June 30, 2008 as compared to Rs648.1mn.
Total Income increased from Rs5,168.8mn for the quarter ended June 30, 2007 to Rs6,494.5mn for the quarter ended June 30, 2008. The scrip touched an intra-day high of Rs260 and a low of Rs228 and recorded volumes of over 4,00,000 shares on BSE.
Parsvnath Developers slipped by 1% to Rs111 after the company announced its Q1 results with net profit declining by 22% at Rs712.9mn for the quarter ended June 30, 2008 as compared to Rs844.6mn for the quarter ended June 30, 2007.
However, Total Income increased from Rs3,568.5mn for the quarter ended June 30, 2007 to Rs3,717.4mn for the quarter ended June 30, 2008. The scrip touched an intra-day high of Rs114 and a low of Rs109 and recorded volumes of over 4,00,000 shares on BSE.
Titan Industries gained by 3% to Rs1127 after the announced its net profit of Rs322.2mn for the quarter ended June 30, 2008 as compared to Rs126.4mn for the quarter ended June 30, 2007.
Total Income increased from Rs6,580mn for the quarter ended June 30, 2007 to Rs8,111.4mn for the quarter ended June 30, 2008. The scrip touched an intra-day high of Rs1147 and a low of Rs1099 and recorded volumes of over 36,000 shares on BSE.
Nagarjuna Construction declined by 3% to Rs130. The company announced its Q1 results with net profit after tax of Rs370.8mn for the quarter ended June 30, 2008 as compared to Rs360.3mn.
Total Income increased from Rs7,625.8mn for the quarter ended June 30, 2007 to Rs9,717.9mn for the quarter ended June 30, 2008. The scrip touched an intra-day high of Rs137 and a low of Rs128 and recorded volumes of over 2,00,000 shares on BSE.
- Chrysler in talks with Tata Motors for distribution of its Jeep Wrangler SUV. (DNA)
- Bajaj Auto redraws bike platform strategy. (DNA)
- JSW Steel to increase prices in August 2008. (DNA)
- JSW group plans $40bn investment plan in steel and power sectors. (BS)
- Nalco will pay double for uninterrupted coal supply for its Damanjodi refinery and Angul smelter. (DNA)
- Dabur plans Rs2.5bn capex. (DNA)
- Vishal Retail postpones Rs2bn IPO. (DNA)
- Tatas scrap $3bn Bangladesh project. (BS)
- Daiichi open offer for Ranbaxy to be delayed. (BS)
- General Motors in talks with M&M for sale of Hummer brand. (BS)
- RIL sees $1bn loss on gas sales to RNRL. (BS)
- Indiabulls Power Services has signed MoU with Madhya Pradesh government to set up a 2,640MW power project. (BS)
- Kirloskar Oil hives off valve division. (BS)
- Unitech to raise $1bn for hotel and retail projects. (BS)
- Kinetic plans foray into auto parts. (BS)
- Tata Chemicals plans Rs7bn investment. (BS)
- Garware Offshore to buy five ships for $100mn. (BL)
- RIL wants cap on liability for gas supply. (BL)
- Tatas, Reliance put mega power projects on fast track. (BL)
- JK Lakshmi Cement begins work on 2.7mt plant. (BL)
- ONGC plans integrated offshore supply base; terminal on east coast. (BL)
- UB group plans contract farming of barley in South. (BL)
- Birla Corporation to set up cement plant in Madhya Pradesh. (BL)
- Moody downgrades IOC’s rating to ‘Baa3’ from ‘Baa2’. (ET)
- Jet Airways hikes basic fare as much as 10%. (ET)
- Essar Group unit secures order from Maharashtra Airport Development Company to develop five-star hotels. (ET)
- Videocon Group acquires 14% equity stake in IOL Netcom. (ET)
- Sintex Industries acquires 90% stake in German-based Geiger Technik for pounds 35.6mn. (ET)
- Berger Paints set to hike paint prices for third time in a row in three months. (ET)
- Jindal Steel & Power plans to invest Rs120bn through a combination of equity and debt. (ET)
- BRFL to set up captive yarn capacities. (ET)
- US may withdraw motion filed against Ranbaxy. (FE)
Reliance Industries on Thursday informed the Bombay High Court that it would incur losses in the range of 600-900 million dollars annually if it supplies gas to Anil Ambani-owned Reliance Natural Resources Ltd at 2.34 dollars per mmBtu.
Mukesh Ambani-owned RIL told the court that it could not promise a fixed quantity of gas to RNRL at 2.34 dollars, which is much lower than the price fixed by the government at 4 dollars per mmBtu.
If RIL entered into a contract to supply the fixed quantity of gas at 2.34 dollars, it would incur annual losses ranging from USD 600 to 900 million, RIL told the high court.
Division bench of Justices J N Patel and K Tated is hearing the dispute over gas supply from the Krishna-Godavari basin between RIL and RNRL.
RIL's counsel Harish Salve argued that RNRL's power plant was not going to commence before 2010 and till then, RIL could not be restrained from extracting gas.
As such, RIL could not wait for RNRL's power plant to come up and so they had to enter into gas sale purchase agreements (GSPA) with third parties.
Once RNRL notified it that their plant was working, they could enter into GSPA between them.
"The country needs the gas and if we keep waiting for RNRL, the government which owns the natural resource, will take us out of contract by 2025 anyway when the lease ends," said Salve.
RNRL has already given up its right on the gas for trading earlier, which they are trying to revive, he contended and added that the Gas Supply Master Agreement between RIL and RNRL specifically includes supply of gas on a suitable agreement for RNRL's power plants.
Regarding supply of gas for the RNRL power plant when it comes up, the quantity can be decided in accordance with a formula considering the total resource of gas available, the tenure for which the extraction will be carried out less the share that has to be given to the government on an annual basis, Salve contended.
RNRL is entitled to 28 mmscmd of gas when the production reaches 40 mmscmd. If RNRL want to procure more in case when the production increases, it will have to purchase it at market price, he said.
The GSPA has to be revised in accordance with the annual production of gas, he further said.
Also, just because RIL and RNRL are in dispute, the production sharing contract (PSC) with the government cannot be compromised, added Salve.
"We are ready to give the gas at the fixed price provided the government approves such price," he said.
RNRL has been citing the memorandum of understanding between the two companies regarding the fixed quantity of gas at the said price but the MOU cannot supercede the PSC with the government, he contended.
Also, the government has specifically said that the prices of gas to any third party other than itself has to be at arms-length prices, Salve argued.
RIL has invested 8 billion dollars in the project, he told the court.
Salve will continue to argue on the MOU, the documents in connection with the MOU and what is the scope of the company's jurisdiction regarding gas supply in the next hearing on August 5.
We recommend a ‘buy’ in Aditya Birla Nuvo from a short-term perspective.
From the charts of Aditya Birla Nuvo, we notice that the stock had been on an intermediate term downtrend from January 2008 peak of Rs 2,502 to its 52-week low of Rs 1,035 recorded on July 18. Nevertheless, the stock found support at its July low and reversed direction.
This trend reversal has been triggered by positive divergence in the daily moving average convergence and divergence (MACD). Besides, the weekly relative strength index displays positive divergence.
On July 23, the stock jumped up 11 per cent with an upward gap, penetrating the intermediate-term down trendline.
We believe this to be a breakaway gap. We observe heavier volumes also. The stock has been on a short-term uptrend since its 52-week low.
The daily RSI has entered into the bullish zone from the neutral region. The MACD is on the brink of entering into the positive territory.
The stock is trading well-above its 21- and 50-day moving averages.
We are positive on the stock in the short-term and expect the stock to hit our target price of Rs 1,455 in the approaching trading sessions. Traders with a short-term perspective can buy the stock with a stop-loss at Rs 1,260.
Gold and silver prices gain 1% and 3% respectively in July 2008
Bullion metal prices registered modest gains today, Thursday, 31 July, 2008 after a pack of economic data on the Wall Street disappointed and also after the dollar lost ground against some of its major currencies. Going into close, gold pared some of its gains but still ended considerably higher. But silver prices rose for the day.
Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies. On the other hand, a lower dollar pushes up precious metal prices as their demand lessens as it becomes cheaper for traders holding other currencies.
Comex Gold for August delivery rose $10.4 (1.1%) to close at $922.7 ounce on the New York Mercantile Exchange. It rose to a high of $933.7 during intra day trading. Last week, it ended lower by $30 (3.2%). With today’s close, gold ended July, 2008 lower by $11 (1.1%). On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped since then.
This year, gold prices have gained 9.9% till date against a 8.4% drop for the dollar against the euro. The yellow metal ended second quarter with a marginal gain of 0.7%. Gold prices ended June, 2008 with a gain of 4.1%. In May, it ended with a gain of higher by $22.5 (2.5%). Before May, for April, prices closed lower by 6.3%.
For first quarter prices gained 10.7%. In January, prices gained 11%, the highest monthly gain since April 2006. For February, it gained 6%. But in March, prices succumbed and fell by 5.5%.
On Thursday, Comex silver futures for September delivery rose 32 cents (1.8%) to $17.79 an ounce. Silver has gained 20.5% in 2008 till date. It ended July 2008 with a gain of 3%. For the second quarter, it had gained a paltry 1.4%.
Silver prices ended the month of May 2008 with a gain of 2.7%. For April, it closed lower by 5.5%. Silver had gained 16% in Q1. In January this year itself, prices climbed 14%. In February, it gained another 15%. For March, it ended lower by 13%. The metal had climbed 16% in FY 2007. The metal also has gained for seven straight years.
At the currency markets on Thursday, the dollar got a lift later in the day from sagging crude oil futures and bounced back against major rivals, after slumping earlier as data painted a worrying picture of the U.S. economy. The dollar index which measures the greenback against a trade-weighted basket of currencies was at 73.259, up from a low of 72.856 and against 73.338 in the previous day.
According to the latest economic data, the U.S. economy expanded 1.9% in the second quarter, which is less than the expected 2.3% gain. Also, jobless claims also came in worse than expected. For the week ending 26 July, jobless claims climbed 44,000 to 448,000. That marked the third time in the last five weeks claims have surpassed 400,000. Continuing claims rose 6.0% to 3.282 million, while the four-week moving average jumped to 393,000 from 382,000.
At the crude market on Thursday, crude futures dropped more than $2 extending their monthly losses to a record high of nearly $16, as weaker-than-expected U.S. economic data spurred concerns that demand in the world's largest oil consumer could fall further. Oil for September delivery closed down $2.69, or 2.1%, at $124.08 a barrel on the New York Mercantile Exchange. Futures earlier fell to an intraday low of $122.71 a barrel. Crude lost $15.92 (11%) this month, the biggest ever in dollars.
The weakening dollar and higher global demand for raw materials have led to records this year for commodities including gold. 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. Gold and oil has climbed 34% and 60% since the past one year.
During last week of June, Federal Reserve yesterday sharpened its focus on inflation, saying that the upside risks to inflation have increased. Fed held its target for short-term interest rates steady at 2%. Since last September, Fed has axed interest rates seven times and brought it down to 2%. On the other hand, after keeping interest rates unchanged at 4% since June, 2007, ECB hiked the same to 4.25% in June, 2008.
Gold had witnessed the greatest annual gain in twenty eight years by gaining $200/ounce (31%) in FY 2007 as lower interest rates had sent the dollar tumbling, and crude-oil prices rose to a record. In 2006, silver had jumped 46% while gold gained 23%.
At the MCX, gold prices for August delivery closed higher by Rs 141 (1.13%) at Rs 12,618 per 10 grams. Prices rose to a high of Rs 12,724 per 10 grams and fell to a low of Rs 12,470 per 10 grams during the day’s trading.
At the MCX, silver prices for September delivery closed Rs 238 (0.97%) higher at Rs 24,720/Kg. Prices opened at Rs 24,555/kg and rose to a high of Rs 24,985/Kg during the day’s trading.
Prices give up most of its yesterday’s gains on weak economic data
Crude prices gave up most of its yesterday’s gains today, Thursday, 31 July, 2008 as a pack of economic data on Wall Street disappointed investors rising questions about the demand for crude for the world’s No 1 consumer of oil in the coming days. With today’s drop, crude also registered substantial drop in price for the month of July, 2008.
Crude-oil futures for light sweet crude for September delivery closed at $124.08/barrel (lower by 2.69/barrel or 2.1%) on the New York Mercantile Exchange. Futures earlier fell to an intraday low of $122.71 a barrel. Crude lost $15.92 (11%) this month, the biggest ever in dollars. Last week, prices coughed up $6.5 (4.8%). It's now 16% lower than the $147.27 record high hit last on 10 July, 2008.
According to the latest economic data, the U.S. economy expanded 1.9% in the second quarter, which is less than the expected 2.3% gain. The report also showed a recession may have begun in the final three months of 2007, as gross domestic product was revised to show a contraction in the period.
Also, jobless claims also came in worse than expected. For the week ending 26 July, jobless claims climbed 44,000 to 448,000. That marked the third time in the last five weeks claims have surpassed 400,000. Continuing claims rose 6.0% to 3.282 million, while the four-week moving average jumped to 393,000 from 382,000.
Yesterday, EIA reported today that crude supplies fell by 100,000 barrels to 295.2 million barrels for the week ended 25 July. EIA also reported that as for the oil products, motor gasoline supplies dropped by 3.5 million barrels to 213.6 million last week following a total climb of more than 8 million barrels between the weeks ended 27 June and 18 July. Distillate inventories, which include heating oil, were up 2.4 million at 130.5 million.
The increase in gasoline supplies came even as demand for motor gasoline stood at an average of about 9.4 million barrels per day over the past four weeks, down 2.4% from the same time a year ago.
Crude prices gained 38% in the second quarter of this year. It was the biggest quarterly increase in nine years. It ended June 2008 higher by 9.9%. Prices are 59% higher than a year ago. For the year, crude is up by 30% till date.
Against this background, September reformulated gasoline fell 3% to $3.07 a gallon and September heating oil futures dropped 2.4% to $3.46 a gallon today.
Natural gas in New York fell, posting the biggest monthly decline in more than five years, after a U.S. government report showed inventories increased and crude oil declined. Natural gas for September delivery fell 12.9 cents (1.4%) to settle at $9.119 per million British thermal units. Gas futures slid 32% this month as crude too slipped.
EIA reported today that natural gas supplies rose 65 billion cubic feet in the week ended 25 July, above the average change of 55 billion for this time of year over the last five.
At the MCX, crude oil for August delivery closed at Rs 5,278/barrel, lower by Rs 69 (1.3%) against previous day’s close. Natural gas for August delivery closed at Rs 388.3/mmbtu, lower by Rs 4.2/mmbtu (1.07%).
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