Tuesday, September 23, 2008
Hong Kong, Shanghai shows retreat While Kospi Register Some Gains
The stock markets across the Asian region closed mostly lower on worries about the effectiveness of the U.S. government's $700 billion bailout plan for failing financial firms. Investors also turned cautious ahead of the U.S. Treasury Secretary Henry Paulson's testimony to the Senate Banking Committee. The Dow closed down 3.3% at 11,015.69, the Nasdaq closed down 4.2% at 2,178.98 and the S&P 500 closed down 3.8% at 1,207.09.
Crude oil futures for November settlement fell more than $2 in the Asian session Tuesday after the contract surged nearly $7 to settle at $109.37 a barrel. Crude-oil futures leaped more than $16 a barrel yesterday to score their biggest one-day gain in dollar terms since 1984 -- when crude began trading on the New York Mercantile Exchange. Crude futures rallied yesterday to a high of $130 a barrel -- their highest intraday level in two months -- buoyed by a steep drop in the U.S. dollar and speculation that the Bush administration's proposal to stabilize the financial sector might help revive economic growth.
Trading was halted for five minutes after the October crude contract reached the daily price-movement limit of $10 per barrel. Under trading rules, the price-change limit is increased by another $10. Crude for October delivery rose $16.37, or 15.7%, to close at $120.92 a barrel on the New York Mercantile Exchange. The gain surpassed the previous price-gain record of $10.75, registered on June 6 of this year. According to Fact Set this is the highest percentage rise in a single day was seen on Jan. 3, 1994, at 20.9%.
On the currency front, the Australian dollar held firm against a broadly weak U.S. dollar, supported by a rebound in commodities. However, the Aussie trimmed gains as a fresh bout of risk aversion swept financial markets. In late trade, the Aussie eased to US$0.8414 from a session high of US$0.8470. The Aussie closed Monday's local session at US$0.8328-0.8331
The New Zealand dollar steadied slightly below three-week highs on Tuesday. The kiwi finished the session at US$0.6892-0.6902 compared to Monday's local close of US$0.6861-0.6871.
The South Korean won fell against the U.S. dollar. The local unit finished the session at 1,149.0 a dollar, down from Monday's close of 1,140.3 a dollar.
Coming back in Asian equity markets, the financial markets in Japan remained closed on account of Autumn Equinox holiday.
The Chinese stock market closed lower, on profit taking, after the key index surged more than 17% over the previous two sessions. Property developers and liquor producers led the losers. However, index heavyweight PetroChina posted sharp gains on news that its parent company bought 60 million shares, equivalent to a 0.03% stake. The benchmark Shanghai Composite Index closed down 1.56% at 2,201.51.
The Hong Kong market closed sharply lower on profit taking following steep gains in the previous two sessions. The benchmark Hang Seng index closed down 3.87% at 18,872.85.
The Australian stock market closed sharply lower, following two days of gains that saw the index climb almost 10%. The benchmark S&P/ASX 200 index closed down 1.9% at 4,923.5 and the broader All Ordinaries index lost 1.8% at 4,957.7.
The New Zealand stock market closed lower after posting 3% gains over the previous two trading sessions. The benchmark NZX 50 index closed down 0.85% at 3,228.19 and the broader NZX All Capital index lost 0.79% to finish at 3,241.37.
The South Korean market closed higher, recovering from a weak start following Wall Street's plunge overnight. Investors bought machinery, finance and other blue-chip stocks, despite weakness among regional markets and the biggest one-day jump in crude oil prices on Monday. The benchmark Korea Composite Stock Price Index, or KOSPI, rose 1.44% to finish at 1,481.37, extending gains for the third consecutive trading session.
In India, weak global markets and high crude oil prices spooked domestic markets as benchmark index plunged by about 3% as doubts grew about the success of the US government $700 billion bailout package to shore up the economy.
As per provisional closing, the BSE 30-share Sensex was down 424.65 points or 3.03% to 13,570.31. The index shed 451.49 points at the day's low of 13,543.47, hit in fag end of the session. The Sensex fell 16.7 points at day’s high of 13,978.26, hit in mid-morning. The S&P CNX Nifty was down 95.80 points or 2.27% to 4127.25.
Elsewhere, Taiwan's Taiex closed up 1.2% at 6,182; Singapore's STI closed down 2.7% at 2,476; Malaysia's KLCI closed down 0.2% at 1,026; Indonesia's Jakarta Composite index closed down 1.3% at 1,873. Japanese markets were closed for a holiday.
In the other part of the world, European shares declined, with consumer discretionary stocks and banks under pressure as oil futures hovered around $107 a barrel and investors continued to fret about the U.S. government's plans to stabilize the financial sector and the health of the European economy.
On a national level in Europe, the U.K. FTSE 100 index fell 2% to 5,13154, the German DAX 30 index declined 0.6% to 6,071.88 and the French CAC-40 index fell 1.4% to 4,165.21. At 10.37 GMT continued to gain further as U.K. FTSE 100 index plunged further by 2.24% to 5,118.78. The German DAX 30 index decreased by 0.73% to 6,062.94, while the French CAC-40 index was down by 1.6% to 4,156.10.
Looking ahead for the day, all eyes will be on Federal Reserve Chairman Ben Bernanke when he testifies before the Senate Banking Committee regarding the U.S. financial markets. It will be accompanied by housing price index for the month of July and Richmond Fed manufacturing index for the month of September. In the evening ABC/ Washington Post will release its weekly consumer confidence report for the week ended on 21 September 2008.
24th September, 2008 to 8th October, 2008
NSE MARKET TIMINGS during SUN OUTAGE
MARKET OPEN 09:55 AM to 11:25 AM
BREAK 11:25 AM to 12:10 PM
MARKET RESUME 12:10 PM to 04:15 PM
CLOSING SESSION 04:35 PM to 04:45 PM
BSE MARKET TIMINGS during SUN OUTAGE
MARKET OPEN 09:55 AM to 11:25 AM
BREAK 11:25 AM to 12:10 PM
MARKET RESUME 12:10 PM to 04:15 PM
CLOSING SESSION 04:30 PM to 04:50 PM
Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
23/9/2008 531223 ANJANI SYNTH PARI STOCK TRADING PVT LTD B 120000 49.93
23/9/2008 531223 ANJANI SYNTH PARI STOCK TRADING PVT LTD S 120000 45.23
23/9/2008 506074 ARSHIYA INTL ARCHANA AJAY MITTAL B 893277 155.00
23/9/2008 506074 ARSHIYA INTL TEMPLETON M F AC FRANKLIN INDIA HIGH GROWTH CO FUND S 895561 155.00
23/9/2008 519532 ASIAN TEA EX VHM IMPEX PRIVATE LTD B 92813 94.73
23/9/2008 533016 AUSTRAL COKE OPG SECURITIES P LTD B 172671 219.12
23/9/2008 533016 AUSTRAL COKE OPG SECURITIES P LTD S 172671 219.07
23/9/2008 590059 BIHAR TUBES MUKESH JAIN B 43000 201.57
23/9/2008 526652 CALS REF LTD NIDHI HARSHVARDHAN BHUWALKA B 5700000 4.42
23/9/2008 532413 CEREBRA INT SURESH VALANI S 60000 22.03
23/9/2008 531367 DOLLEX INDUT EVOLUTION CORPORATE SERVICES PVT LTD B 70000 13.00
23/9/2008 531367 DOLLEX INDUT YUSUF KHAN S 72000 12.98
23/9/2008 513059 G.S. AUTO SPJSTOCK B 291649 89.08
23/9/2008 513059 G.S. AUTO NARESH CHAND JAIN B 20521 89.34
23/9/2008 513059 G.S. AUTO HARDIK M MITHANI S 70620 89.61
23/9/2008 513059 G.S. AUTO SPJSTOCK S 197649 86.28
23/9/2008 513059 G.S. AUTO NARESH CHAND JAIN S 20521 90.04
23/9/2008 531137 GEMSTONE INV PREM M PARIKH B 25000 59.95
23/9/2008 531137 GEMSTONE INV BHAVESH P PABARI B 25114 59.94
23/9/2008 512219 INDUSVISTA KAMLESHCHANDRA B 26000 32.20
23/9/2008 505840 JAIPAN INDUS VHM IMPEX PRIVATE LTD B 50488 201.08
23/9/2008 531602 KOFF BR PICT LAXMI CAP BROKING PVT LTD B 27802 41.71
23/9/2008 531602 KOFF BR PICT LEELABEN AMRUTLAL DARJI S 46036 40.15
23/9/2008 531096 MOUNT EVE MI TATA TEA LTD B 384000 140.00
23/9/2008 590011 MOVING PICTU-PMS VINCENT COMMERCIAL CO. LTD. B 200000 12.50
23/9/2008 590011 MOVING PICTU-PMS MACKERTICH CONSULTANCY SERVICESPVTLTD S 200000 12.50
23/9/2008 531349 PANACEA BIOT BNP PARIBAS ARBITRAGE B 493777 226.00
23/9/2008 531349 PANACEA BIOT CLSA MAURITIUS LIMITED B 1375367 228.50
23/9/2008 531349 PANACEA BIOT MERRIL LYNCH CAPITAL MARKETS ESPANA SA SV FCCB S 1869144 227.84
23/9/2008 506605 POLYCHEM LTD HASMUKH LILADHAR PANCHAL S 3300 151.67
23/9/2008 503873 PRIYA SPIN L RELIGARE FINVEST LTD LIQUIDATI S 53043 8.41
23/9/2008 500368 RUCHI SOYA GOLDMAN SACHS INVESTMENTS MAURITIUS I LTD B 1200000 77.15
23/9/2008 500368 RUCHI SOYA CALYON S 1200000 77.15
23/9/2008 532031 SARANG CHEMI SHAH EKTA RIPPLE B 25000 2.59
23/9/2008 511607 SHLOKA INFO VHM IMPEX PRIVATE LTD B 23100 84.26
23/9/2008 507998 SIMMOND MARS JAYDEVMODY S 12036 54.92
23/9/2008 532372 VIRINCHI TE IRON AGE INDIA LIMITED B 209000 15.10
23/9/2008 532372 VIRINCHI TE NAMASIVAYAMSATHASIVAM S 209000 15.10
23/9/2008 533011 VISHAL INFO OPG SECURITIES P LTD B 184775 336.99
23/9/2008 533011 VISHAL INFO OPG SECURITIES P LTD S 184775 336.86
Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
23-SEP-2008,AUSTRAL,Austral Coke & Projects L,AMBIT SECURITIES BROKING PVT. LTD.,BUY,210547,220.35,-
23-SEP-2008,SASKEN,Sasken Commu Techno Ltd,WEXFORD CAPITAL LLC A/C WEXFORD SPECTRUM INVESTORS LLC,BUY,144900,134.93,-
23-SEP-2008,VINCARDS,Vintage Cards & Creations,YUVAK SHARE TRADING PVT LTD,BUY,3212,55.90,-
23-SEP-2008,AUSTRAL,Austral Coke & Projects L,AMBIT SECURITIES BROKING PVT. LTD.,SELL,210547,220.28,-
23-SEP-2008,GOLDTECH,Goldstone Tech Ltd.,SANCHANIYA ANKIT RAJENDRA,SELL,110000,118.78,-
23-SEP-2008,VINCARDS,Vintage Cards & Creations,YUVAK SHARE TRADING PVT LTD,SELL,6691,55.92,-
Key benchmark indices suffered sharp losses mirroring its global peers on uncertainty about the potency of the US government's $700 billion bank bailout. High volatility was the hallmark of the day's trading session. All BSE sectoral indices suffered losses with IT, realty and banking leading the fall. However state-run oil marketing firms bucket weak market trend. The market breadth was weak. Ranbaxy Labs slumped over 11%.
European markets were trading lower. Key indices in UK, France and Germany were down 1.06% to 2.69%. Asian markets, which opened before Indian markets, were mixed. Key indices in China, Hong Kong and Singapore were down by 1.56% to 3.87%. However, key indices in Taiwan and South Korea were up by 1.17% to 1.44%. Japanese financial markets were closed today for Autumnal Equinox Day, a national holiday.
The BSE 30-share Sensex was down 424.65 points or 3.03% to 13,570.31. The index shed 451.49 points at the day's low of 13,543.47, hit in fag end of the session. The Sensex fell 16.7 points at day’s high of 13,978.26, hit in mid-morning.
The S&P CNX Nifty was down 96.15 points or 2.28% to 4,126.90. Nifty September 2008 futures were at 4135, at a premium of 8.1 points as compared to spot closing.
The BSE Mid-Cap index was down 2.06% at 5,113.31 and the BSE Small-Cap index was down 1.63% at 6,092.97.
The market breadth was weak on BSE with 760 shares advancing as compared to 1823 that declined. 69 shares remained unchanged.
BSE clocked a turnover of Rs 4322 crore compared with Rs 4,886.79 on Monday, 22 September 2008. NSE's futures & options (F&O) segment turnover was Rs 68368.66 crore, which was higher than Rs 58188.03 crore on Friday, 19 September 2008.
India’s largest drug maker by sales Ranbaxy Laboratories declined 11.05% at Rs 308.85 on reports the Canadian drug regulator, Health Canada, issued a notice to Ranbaxy saying it will be particularly cautious about drug marketing applications from Ranbaxy after the US drug regulator blocked the sale of more than 30 generic medicines made in two factories by the company. The stock had declined 2.70% in the previous session.
India’s largest private sector firm by market capitalisation and oil refiner Reliance Industries (RIL) declined 1.35% at Rs 2009.70. The stock came off session’s high of Rs 2,096. Reliance Industries (RIL) began production of crude oil at KG-D6 block of the Krishna Godavari basin on 17 September 2008, the company said on 22 September 2008. RIL holds 90% participating interest in the block while the balance is being held by Niko Resources.
India's largest aluminium producer Hindalco Industries fell 1.59% at 108.10 after hitting a 52-week low of Rs 106.20 on BSE. The company's Rs 5,050 crore rights share offering for subscription Monday, 22 September 2008. The sale in a ratio of three shares for every seven held at Rs 96 a share will close on 10 October 2008. The company aims to use the funds to repay a bridge loan it had taken to buy Canada's Novelis in 2007.
Software shares tumbled on growing worries about outsourcing prospects amid a global financial turmoil. Satyam Computer (down 5.98% at Rs 331.65), TCS (down 5.91% at Rs 720.75), Wipro (down 5.77% at Rs 390.45), and Infosys Technologies (down 5.19% at Rs 1,543.35), slipped. The BSE IT index underperformed the Sensex, falling 5.07% at 3,455.05. Export-driven Indian software firms earn more than half of their revenue in dollar terms.
Realty shares extended previous session's fall. Indiabulls Real Estate (down 6.93% at Rs 209.50), Housing Development & Infrastructure (down 5.97% at Rs 209.60), and Unitech (down 3.66% at Rs 123.80), slumped. The BSE Realty index underperformed the Sensex, falling 4.68% to 3,903.82.
India's largest real estate developer by market capitalisation DLF fell 6.25% at Rs 394.60. As per recent reports, the company is retrenching around 300 employees across all its centres and subsidiaries as it decides to slow down its project execution, especially in Tier II cities, in the face of shrinking demand and expensive borrowing.
Banking shares were hard hit on fears local banks may reportedly suffer losses on their exposure to the US financial giants that collapsed recently. ICICI Bank (down 5.48% at Rs 599.70), HDFC Bank (down 4.62% at Rs 1237.70), and and State Bank of India (down 4.08% at Rs 1502.75), dipped. The BSE Bankex underperformed the Sensex, falling 4.19% to 6,804.42.
As per reports, nine of the country's largest commercial banks including State Bank of India (SBI), ICICI Bank and HDFC Bank reportedly have exposure of $420 million (Rs 2,000 crore) in the US financial giants. As per the government, banks other than SBI would suffer losses of Rs 600 crore due to the crisis. SBI alone has exposure of $170 million in Freddie Mac and Fannie Mae. The public sector giant’s exposure in Lehman Brothers is estimated at $17 million.
The estimated losses are due to their ownership of securities sold by Fannie Mae, Freddie Mac, Merrill Lynch & Co., and Lehman Brothers Holding Inc, which have declined in value leading to marked-to-market losses, the report said.
Shares of three state-run oil marketing firms rose after crude oil for November 2008 delivery fell $3.30 to $106.07 a barrel in electronic trading today, 23 September 2008. BPCL (up 2.51% at Rs 345.55), Indian Oil Corporation (up 1.62% at Rs 388.60), and HPCL (up 1.24% at Rs 233.45), rose.
Reliance Industries clocked a highest turnover of Rs 396.30 crore on BSE. Reliance Capital (Rs 277.86 crore), Sesa Goa (Rs 239.39 crore), State bank of India (Rs 136.38 crore), and Reliance Natural Resources (Rs 135.41 crore), were the other turnover toppers on BSE in that order.
Sesa Goa reported a highest volume of 1.86 crore shares on BSE. Reliance Natural Resources (1.67 crore shares), Apollo Tyre (74.32 lakh shares), IFCI (67.07 lakh shares), and Cals Refineries (62.66 lakh shares), were the other volume toppers on BSE in that order.
The barometer index is down 6716.68 points or 33.10% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 7636.46 points or 36% below its all-time high of 21,206.77 struck on 10 January 2008.
Diversified firm Karuturi Global rose 1.98% to Rs 20.65 on reports the company plans to raise $100 million by selling 15% stake in its Dubai based subsidiary to an undisclosed private equity firm.
Steel roll maker Tayo Rolls fell 3.59% to Rs 135.80 after the company scheduled a board meet on 26 September 2008 to price and fix swap ratio for its Rs 60.34 crore rights issue. The stock came off session's high of Rs 148.50 hit in early trade.
Construction firm Nagarjuna Construction Company lost 3.78% to Rs 112 even as the company secured four orders aggregating Rs 413 crore.
The BSE and NSE will extend trading hours from 24 September 2008 on account of disruption of satellite services due to sun outage. Trading will start as usual at 9.55 IST, but will be suspended between 11.25 IST and 12.10 IST. The day’s session will end at 16.15 IST. The new trading timing will be effective till 8 October 2008.
The correction continued for the second consecutive day on weak global indices and rising crude prices. Dwindling foreign fund inflows into the domestic market in the past few sessions also adversely affected the sentiment. After shedding around 200 points by mid-morning, the market remained in the negative territory, however in afternoon it came close to erasing its losses. But, the mood turned extremely bearish, as widespread selling in IT, realty, banking and teck stocks dragged the index below the 13,600 mark to an intra-day low of 13,543. The Sensex finally managed to pare some of its losses and close at 13,995, down 425 points. The broad-based Nifty closed at 4,127, down 96 points.
The breadth of the market was extremely negative. Of the 2,650 stocks traded on the BSE, 1,808 stocks declined, whereas only 772 stocks advanced. The remaining 70 stocks remained unchanged. All the sectoral indices on the BSE were hammered. The BSE IT was the worst hit and tanked 5.07% at 3,455 followed by the BSE Realty index (down 4.68% at 3,903.82), the BSE Bankex (down 4.19% at 6,804.42) and the BSE Teck index (down 3.54% at 2,763.73).
Barring ACC and Tata Power, all other Sensex stocks bore the brunt of heavy selling. Ranbaxy Laboratories led the slump and crashed 11.05% at Rs308.85. Among other major laggards, DLF tumbled 6.25% at Rs394.60, Satyam Computer Services dropped 5.98% at Rs331.65, Tata Consultancy Services slumped 5.91% at Rs720.75, Wipro fell 5.77% at Rs390.45 and HDFC declined 5.53% at Rs2,198.05. ICICI Bank lost 5.48% at Rs599.70, Infosys Technologies was down by 5.19% at Rs1543.35 and Tata Motors shed 5.03% at Rs394.05. The other major front-line stocks shed 1-4% each. However, ACC rose marginally at Rs626.20 up 0.27% and Tata Power rose 0.16% at Rs1,022.30.
IT stocks lost significantly on relentless selling. Rolta India dropped 9.61% at Rs260.40, Moser Baer India shed 8.46% at Rs122.25, NIIT tumbled 5.21% at Rs58.25 and Tech Mahindra declined 3.11% at Rs636.20. Aptech, Oracle, Mphasis and Patni Computer shed 2% each.
Over 1.86 crore Sesa Goa shares changed hands on the BSE followed by Reliance Natural Resources (1.67 crore shares), Apollo Tyre (0.74 crore shares), IFCI (0.67 crore shares) and Cals Refineries (0.62 crore shares).
Value-wise, Reliance Industries registered a turnover of Rs395 crore on the BSE followed by Reliance Capital (Rs277 crore) and Sesa Goa (Rs239 crore).
Indian Markets crushed during final hours of trading as huge selling pressure was witnessed across the board on weak global cues. There is an uncertainty on the details regarding the U.S. government’s $700 billion plan to fix the financial market turmoil and the two major Wall Street investment banks Goldman Sachs and Morgan Stanley, converted to a traditional banking structure. Crude oil prices also put fire into the markets as jumped by $16.37 to $120.92 a barrel after touching an intraday high of $130 a barrel, on the New York Mercantile Exchange. Indian markets today opened on downbeat note on the back of weak cues across the globe. Further, markets managed to recover some losses in early trade but were not able to sustain the momentum and slipped further. Huge sell off on the back of profit booking forced markets to land in extremely negative territory. Weak European markets also contributed to the selling pressure. BSE Sensex ended below 13,600 level and NSE Nifty closed below 4,150 mark. From the sectoral front, all of the indices are ended with losses and among those, sharp cut was seen in Bank, Capital Goods, Metal, Reality, IT and Oil & Gas stocks. Mid cap and Small cap stocks also got hammered during the trading session as ended with cut of more than 2% and 1% respectively. The market breadth was negative as 1823 stocks closed in red while 760 stocks closed in green and 69 stocks remained unchanged.
The BSE Sensex closed lower by 424.65 points at 13,570.31 and NSE Nifty ended down by 96.15 points at 4,126.90. The BSE Mid Caps and Small Caps closed with losses of 107.65 points at 5,113.31 and by 101.14 points at 6,092.97. The BSE Sensex touched intraday high of 13,978.26 and intraday low of 13,543.67.
Losers from the BSE are Ranbaxy Lab (11.05%), DLF Ltd (6.25%), Satyam Computer (5.98%), TCS Ltd (5.91%), Wipro Ltd (5.77%), HDFC (5.53%), ICICI Bank Ltd (5.48%), JP Associates (5.38%), Infosys Tech (5.19%), Tata Motors (5.03%) and Tata Steel (4.62%).
The BSE Bank index closed lower by 297.87 points at 6,804.42. Losers are Canara Bank (5.53%), ICICI Bank Ltd (5.48%), HDFC Bank Ltd (4.52%), IDBI Bank Ltd (4.50%), SBI (4.08%) and Kotak Bank (3.79%).
The BSE Capital Goods index lost 258.29 points to close at 11,218.80. Major losers are Everest Kanto (6.78%), Usha Martin (6.08%), Jyoti Struct (4.58%), Crompton Greaves (4.10%), Praj Indus (4.08%) and BHEL (3.43%).
The BSE Metal index plunged 208.40 points to close at 9,924.54. Major losers are Tata Steel (4.62%), Jindal Steel (3.73%), JSW SL (3.63%), Ispat Indus (3.10%), Sterlite In (2.18%) and Welspan Guajrat Sr (2.14%).
The BSE Reality index ended lower 191.68 points to close at 3,903.82. As Indiabull Real (6.93%), DLF Ltd (6.25%), Housing Development (5.97%), Orbit Co (4.17%), Unitech Ltd (3.66%) and Parsvnath (3.24%) closed in negative territory.
The BSE IT index dropped by 184.38 points to close at 3,455.05. As Rolta India (9.61%), Moser Bayer (8.46%), Satyam Computer (5.98%), TCS Ltd (5.91%), Wipro Ltd (5.77%), NIIT Ltd (5.21%) and Infosys Tech (5.19%) closed in negative territory.
The BSE Oil & Gas index ended down by 76.67 points at 8,972.89 as Reliance Nat Res (2.52%), Reliance (1.35%), Aban Offshore (0.91%), Reliance Pet (0.72%), Gail India (0.66%) and Essar Oil Ltd (0.61%) ended in negative territory.
Key benchmark indices are geared for a weak start today, 23 September 2008 tracking weak global markets on concerns of the long-term implications of the US Federal Reserve’s $700 billion bailout plan worried investors. Volatility is likely to remain high as derivative contracts for September 2008 series expire on Thursday, 25 September 2008.
As per reports, Nifty rollover of positions from September 2008 series to October 2008 series was 29% while market-wide rollover stood at 25%, as on Monday, 22 September 2008.
Crude oil prices soared to an intra-day high of $130 a barrel on Monday, 22 September 2008 before easing in a rally sparked by the expiry of the front-month futures contract and weakness in the US dollar. US light crude for November delivery was down 42 cents at $108.95 a barrel.
Most Asian markets were trading weak today, 23 September 2008. China's Shanghai Composite slipped 0.48% or 10.83 points at 2,225.57, Hong Kong's Hang Seng plunged 2.19% or 429.51 points at 19,202.69, Singapore's Straits Times fell 1.88% or 47.78 points at 2,496.35, Taiwan's Taiwan Weighted dropped 0.21% 12.72 points at 6,097.88. However, South Korea's Seoul Composite was up 0.31% or 4.58 points at 1,464.92.
US markets witnessed a sell off on Monday, 22 September 2008 on worries about the government's ability to bailout the financial system. The Dow plunged 372.75 points, or 3.27%, to 11,015.69. The S&P 500 index slipped 47.99 points, or 3.82%, to 1,207.09, and the Nasdaq Composite index was down 94.92 points, or 4.17%, to 2,178.98.
Back home, profit booking after a solid surge in the previous session and rise in crude oil pulled the market lower on Monday, 22 September 2008. The BSE 30-share Sensex fell 47.36 points or 0.34% to 13,994.96 and the S&P CNX Nifty fell 22.20 points or 0.52% to 4223.05.
Foreign institutional investors (FIIs) were net equity buyers worth Rs 138.21 crore while mutual funds sold shares worth Rs 206.12 crore on Monday, 22 September 2008, according to provisional data on NSE. They were net buyers of Rs 511.52 crore in the futures & options segment on Monday, 22 September 2008.
Nine of the country's largest commercial banks including State Bank of India (SBI), ICICI Bank and HDFC Bank reportedly have exposure of $420 million in the US financial giants which collapsed recently. The government feels banks other than SBI would suffer losses of Rs 600 crore due to the crisis.
The Children’s Investment Fund (TCI), a UK-based hedge fund, is reportedly planning legal action against Anil Agarwal-owned Vedanta Resources for its recent restructuring proposal, on the ground that it is skewed against minority shareholders. Recently, the UK-based Vedanta Resources Inc., parent of the country’s largest zinc and copper producer, Sterlite Industries India had announced that it was splitting its businesses into three commodity-based verticals to simplify the group corporate structure.
Sterlite Technologies is reported to be in advanced discussions to acquire UK-based cabling company Brand-Rex for roughly $55 million.
Cement prices are likely to go up by Rs 3 - Rs 5 per bag in Mumbai, Delhi, National Capital Region, Gujarat and the southern markets from 1 October 2008, suggest reports.
Reliance Petroleum reportedly plans to begin production at its second refinery in Jamnagar by mid-November.
Karuturi Global is reportedly raising $100 million by selling a 15% stake in its Dubai-based subsidiary.
Essar Shipping Ports & Logistics is reportedly in talks with a few global container port operators for a tie-up as part of its plans for a foray into container berth operations in the Indian ports sector.
Unlisted Sahara India Financial Corporation will reportedly sell its equity stake in Sahara One Media and Entertainment and use the proceeds to meet investment norms laid down by the Reserve Bank od India.
Maytas Infrastructure said on Monday, 23 September 2008 it has secured contracts to build electricity sub-stations, transmission lines and related works in two districts in Maharashtra. The two contracts are totally worth Rs 481 crore, it said in a statement.
Lanco Infratech on Monday, 23 September 2008 said it has received a contract worth Rs 308.98 crore from Andhra Pradesh government for construction related works.
The board of Mirc Electronics at the meeting held on 18 September 2008 approved the proposed amalgamation of Guviso Holdings with the company.
Extreme Volatility In Financial Markets
Gold futures rose more than 5% Monday to end above $900 an ounce for the first time in seven weeks, as a massive government plan to rescue the financial sector pressured the U.S. dollar, increasing the metal's appeal as an alternative investment. Gold for December delivery rose $44.30, or 5.1%, to close at $909 an ounce on the Comex division of the New York Mercantile Exchange, ending above $900 for the fist time since Aug. 4. MCX Gold contract closed the session at Rs 13117 per 10 grams up Rs 408.
The dollar sold off sharply against the majors at the start of the week amid a sharp run-up in crude oil prices and steep declines in the US equity bourses. EUR/USD trades near the 1.48. Oil posted its largest single day advance, rallying by $16.37 to $120.92 per barrel, which was largely attributed to the expiration of October contracts. TThe greenback plunged from 1.4436 to above the 1.48-level against the EURO while losing sterling from 1.8262 to 1.8588.
Uncertainty over the US government's $700 billion rescue plan to purchase bad mortgage debts off banks' balance sheets has triggered heightened volatility in the financial markets and raised fears on whether it will solve the current crisis. The plan is still pending Congressional approval, with additional details possibly not revealed until next week. The dollar will likely continue to bear the brunt of the sharp volatility and concerns of a potentially sharp spike in the deficit. Spot gold continues to trade above $900 per ounce, while crude oil was up by over $25 per barrel in the previous session.
The Market is expected to have negative opening due to weak cues from the global markets as US markets closed in red and Asian markets are trading weak along with rise in crude. On Monday, the Indian markets pared its initial gains to end the day in red zone as investors booked profits during the session on financial concern for global economy. Domestic markets ignored positive cues from Asian markets. Markets opened with gains on positive cues from US markets as US government had proposed a $700billion plan to handle world’s financial crises. The US Federal Reserve on Sunday announced that US investment banks Goldman Sachs and Morgan Stanley will become bank holding companies and will receive new US government credit. Further, market started losing after mid session to close almost flat. From the sectoral front, most of the indices closed with losses and among those Capital Goods, Oil & Gas, Auto and Power stocks were major contributors of selling pressure. However, Metal and FMCG stocks were in limelight as witnessed most of the buying from these baskets. We expect that the market may lose some ground during the trading session.
The BSE Sensex closed lower by 47.36 points at 13,994.96 and NSE Nifty fell by 10.9 points to close at 4,234.35. The BSE Mid Caps and Small Caps closed lower by 7.82 points and 21.88 points at 5,220.96 and 6,194.44. The BSE Sensex touched intraday high of 14,221.04 and intraday low of 13,917.48.
On Monday, the US market dropped after news that the two remaining major Wall Street investment banks Goldman Sachs and Morgan Stanley, converted to a traditional banking structure along with uncertainty on the details regarding the U.S. government’s $700 billion plan to fix the financial market turmoil. Crude oil prices also put fire into the markets as reported biggest one-day gain and jumped by $16.37 to $120.92 a barrel after touching an intraday high of $130 a barrel, on the New York Mercantile Exchange.
The Dow Jones Industrial Average (DJIA) closed down by 372.75 points at 11,015.69 followed by the NASDAQ index closed lower by 94.92 points at 2,178.98 and the S&P 500 (SPX) dropped by 47.99 points to close at 1,207.09.
Indian ADRs ended with losses. In technology sector, Wipro closed down by (11.19%) followed by Patni Computers by (8.25%), Infosys by (4.05%) and Satyam by (3.59%). In banking sector ICICI Bank and HDFC Bank lost (7.32%) and (4.37%). In telecommunication sector, Tata Communication and MTNL dropped by (1.01%) and (0.73%). Sterlite Industries plunged (1.79%).
Today the major stock markets in Asia are trading weak. Japanese financial markets shut today on account of Autumnal Equinox Day, a national holiday. Hang Seng index is trading down by 429.51 points at 19,202.69 along with Taiwan Weighted trading at 6,097 plunged 12.72 points and Singapore''s Straits fell 47.78 points at 2,496.35.
The FIIs on Monday stood as net buyer in equity and in debt. Gross equity purchased stood at Rs6,826.80 Crore and gross debt purchased stood at Rs1432.00 Crore while the gross equity sold stood at Rs5,658.30 Crore and gross debt sold stood at Rs466.20 Crore. Therefore, the net investment of equity reported was Rs1,167.90 Crore and net debt was Rs905.80 Crore.
On Monday, the Indian rupee appreciated by 0.8% and ended at 45.44/45 per dollar than Friday’s close of 45.83. Earlier it hit a high of 45.22/23 in early trade. The Indian currency climbed to the highest in more than a week after the U.S. Treasury proposed buying as much as $700 billion in financial assets to clean up banks'' balance sheets
Today, Nifty has support at 4,106 and resistance at 4,310 and BSE Sensex has support at 13,489 and resistance at 14,284.
Market Grape Wine :
Nifty at a support of 4162 and 4105 with resistance at 4250 and 4310 levels.
Cash: Sell RELIANCE below 2039 target 1980 with S/L 2065.
Cash Sell ICICI BANK target 615 with S/L 645.
Future: Sell DLF below 421 targets 395 with S/L 435.
Future: ICICI BANK below 634 target 600 with S/L 648.
Markets at a support of 13786 & 13452 and resistance at 14041 & 14152 levels .
Maintain strict stop loss as markets to be very choppy and volatile .
Buy : RIL at dips
Buy : LNT at dips
Buy : SBIN at dips
Buy : Kohinoor at dips
Buy : RelCap
Buy : Tisco at dips
Buy : GtOffshore & Aban at dips
Dark Horse : LNT , SBIN , RIL , , Aban , & RPL
The Dow gave up all of its Friday gains as the enormity of the task at hand and the inability of the rescue package to really bail out the financial markets sank in. While the details of the rescue package are being chiseled in the Congress, the markets swooned on its own assumptions and the news that two large surviving Investment Banks, Goldman and Morgan will become bank holding companies.
Our markets are likely to open lower, striking off around 50 points from the overnight Nifty. Crude has spiked $ 16 a barrel and is now back at its $120 perch. The surge came on an assumption that the rescue package could rekindle demand for Crude. The equity and the commodity markets have different perceptions about the potency of the rescue package and one of them is wrong. But if you ascribe this logic that Crude has risen sharply because you expect the Dollar to plunge as Uncle Sam takes on additional $ 2 trillion of debt after the extended package, the move becomes understandable. Nevertheless, a Crude surge to $ 120 , even if temporary, could seriously alter inflation calculations. Buy the 4200 Sep 25 Put at a premium of Rs 49.25.
Despite Asian indices opening firm, the market seemed to have lost steam after opening strong in the morning. The 30-share Sensex of the BSE opened with a positive gap of 173 points at 14,215 and touched the day's high of 14,221 within minutes of trading on the back of brisk buying in heavyweights. However, it shed its early gains on account of heavy selling in capital goods (CG), power, automobile and information technology stocks and entered the negative territory by afternoon. The index tumbled below the 14,000 mark towards the close to touch the intra-day low of 13,917 amid relentless selling pressure. The Sensex finally closed with a loss of 47 points at 14,080. The Nifty closed at 4,223, down 22 points.
The market breadth was weak Of the 2,666 stocks traded on the BSE, 1,354 stocks declined, while 1,234 stocks advanced. 78 stocks ended unchanged. Select sectoral indices slipped sharply. The BSE CG index dropped 2.24% followed by BSE Power index (down 1.62%), the BSE Auto index (down 1.11%) and the BSE IT index (down 0.75%).
Most of the index heavyweights witnessed correction. Among the Sensex majors, Satyam Computer Services tumbled 4.69% at Rs352.75, JP Associates dropped 3.84% at Rs130.05, Maruti Suzuki India lost 3.17% at Rs718.15, and Hindalco slumped by 2.66% at Rs109.85. Larsen & Toubro slipped 2.66% at Rs2576.60, Tata Motors shed 1.88% at Rs414.90, Reliance Infrastructure lost 1.88% at Rs877.30, Sterlite Industries fell by 1.63% at Rs460, BHEL crumbled by 1.57% at Rs1,683.90 and DLF dipped 1.41% at Rs420.90. The other front-line stocks lost around 1% each. However, select counters saw some buying and added to their value. ACC advanced by 3.22% at Rs624.05 while Tata Steel, ITC, Hindustan Unilever, Bharti Airtel, Grasim Industries and ICICI Bank ended with modest gains.
Over 1.49 crore shares of Reliance Natural Resources changed hands on the BSE followed by Sesa Goa (1.38 crore shares), IFCI (0.86 crore shares), JP Associates (73.01 lakh shares) and Idea Cellular (71.33 lakh shares).
India's trade deficit, which crossed 10 billion dollars in July alone, is becoming a cause of concern for the government, a senior commerce ministry official said.
"Trade deficit is worrying," Commerce Secretary Gopal Pillai told reporters here.
He said if the confidence in the Indian economy is not maintained, trade deficit would prove to be a bigger problem. "If the confidence fails, then the trade deficit becomes a big issue," he said.
India's exports grew to 16.34 billion dollars in July this year, while imports rose to 27.14 billion dollars, leaving a trade gap of 10.79 billion dollars.
For the April-July 2008 period, the trade gap widened to 41.22 billion dollars as exports grew 24.6 per cent to 59.19 billion dollars, while imports reached 100.41 billion dollars.
Growth in exports has been mainly on account of the sharp depreciation in value of the rupee against the dollar. The Indian currency closed at 45.45 to a dollar today. Last week, it had dipped to a two-year low of 46 against the greenback .
Pillai, however, said the rupee would appreciate by early next year.
"Post-December, the rupee is likely to appreciate as the global financial situation is expected to start improving," he said.
Asked if the global slowdown will impact India's export target of 200 billion dollars for the current fiscal, Pillai said the target would be met.
"Rupee depreciation is helping exports... In spite of all the recession if you have a 25 per cent growth in exports in dollar terms, it should be a big achievement," he said.
We recommend a sell in Sobha Developers from a short-term perspective. It is clearly evident from the charts of Sobha Developers that it has been on a long-term downtrend from its January peak of Rs 1,041, forming lower peaks and lower bottoms. The stock was in a consolidating phase between late August and early September. While consolidating sideways, the stock shaped a symmetrical triangle pattern (continuation pattern). On September 15, the stock tumbled breaking through the triangle pattern. The stock resumed its downtrend and continues to fall. On Monday (September 22), the stock declined 6 per cent, with high volume. The stock is trading well below its 21- and 50-day moving averages. The daily and weekly relative strength indices are featuring in the bearish zone. Moreover, the moving average convergence and divergence is slipping downward in the negative territory. We are bearish on the stock from a short-term perspective. We anticipate the stock’s decline to continue further until it hits our price target of Rs 180 in the approaching trading sessions. Traders with short-term perspective can sell the stock while maintaining a stop-loss at Rs 212.