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Tuesday, February 24, 2009

Capital goods rally

The market undid most of the day’s losses towards the close. Taking lead from weak global indices Sensex resumed lower from its previous close and the mood remained sombre with market slipping on profit booking in index pivotals, metal and banking stocks. The market once again witnessed selling pressure and Sensex touched the day's low of 8619 by afternoon amid choppy session. However Sensex recovered shrugging off weakness in the early trades on substantial buying towards the close and ends the session at 8822, down 21 points. Nifty ends 3 points at 2734.

The market breadth was negative. Of the 2,501 stocks traded on BSE, 1,613 stocks declined, whereas 790 stocks advanced. Ninety eight stocks ended unchanged. Most of the sectoral indices ended lower. Even those that were up were so only marginally. BSE Metal was down 2.31% followed by BSE Bankex (down 1.36%) and BSE PSU index (down 0.71%). On the other hand, BSE CD (consumer durable index) rallied sharply by 0.73%.

Select counters logged steady gains. Mahindra & Mahindra rose by 4.92% at Rs295.10, Ranbaxy Laboratories added 3.94% at Rs214.85, Grasim Industries gained 3.01% at Rs1,384.65 and DLF moved up by 1.48% at Rs157.35. However several index heavyweights slipped into the red and ended with losses. HDFC declined by 4.78% at Rs1289, Tata Steel dropped 4.46% at Rs160.55, Sterlite Industries slumped 1.85% at Rs243.80, State Bank of India shed 1.75% at Rs1026.25, Sun Pharmaceutical Industries lost 1.72% at Rs1005, Tata Consultancy Services lost 1.57% at Rs466.50, Wipro slipped by 1.44% at Rs212.20 and Tata Motors was down 1.23% at Rs132.10.

Over 1.14 crore shares of Cals Refineries changed hands on BSE followed by Unitech (86.20 lakh shares), Satyam Computer Services (82.90 lakh shares), DLF (60.59 lakh shares) and ICICI Bank (49 lakh shares).

BSE Bulk Deals to Watch - Feb 24 2009

Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
24/2/2009 530393 DB(INTR) STBR MANISHA YOGESH GALA B 20000 13.59
24/2/2009 530393 DB(INTR) STBR JINAY MANSUKH GALA B 30000 13.59
24/2/2009 532696 EDUCOMP SOLN OPG SECURITIES P LTD B 185854 1589.84
24/2/2009 532696 EDUCOMP SOLN OPG SECURITIES P LTD S 185854 1590.26
24/2/2009 513059 G.S. AUTO HARDIK M MITHANI B 25000 6.61
24/2/2009 531602 KOFF BR PICT JINESH BHATT S 397999 3.16
24/2/2009 521206 SAMTEX FASHI CAMEL FOODS PVT LTD S 50000 13.12
24/2/2009 521206 SAMTEX FASHI GEOMETRIC SEC AND ADV PVT LTD S 97000 13.12
24/2/2009 531898 SANGUINE MD ROHIT A JOSHI B 80000 3.54
24/2/2009 531898 SANGUINE MD HEENA KAUSHIK MEHTA B 230000 3.50
24/2/2009 531898 SANGUINE MD BHAMINI KAMAL PAREKH S 80000 3.50
24/2/2009 531898 SANGUINE MD PRASHANT MAHADEV KAMBLE S 286310 3.50
24/2/2009 511076 SAT IND LTD IVORY CONSULTANTS PVT LTD. B 210400 15.50
24/2/2009 512634 SAVERA IND LALIT MODI HUF B 62431 24.01
24/2/2009 526479 SKY INDUSTRI MANOJ RAMESHCHANDRA SHAH S 27050 91.13
24/2/2009 504605 UNIABEX AL P MONEYBEE SECURITIES PVT LTD B 11230 69.97
24/2/2009 531249 WELL PACK PA VISHESH.SHAHRA B 60000 69.07

NSE Bulk Deals to Watch - Feb 24 2009

Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
24-FEB-2009,EDUCOMP,Educomp Solutions Limited,C D INTEGRATED SERVICES LTD,BUY,325810,1592.99,-
24-FEB-2009,EDUCOMP,Educomp Solutions Limited,GENUINE STOCK BROKERS PVT LTD,BUY,96695,1591.18,-
24-FEB-2009,EDUCOMP,Educomp Solutions Limited,P R B SECURITIES PRIVATE LTD,BUY,114903,1590.11,-
24-FEB-2009,NIITTECH,NIIT Technologies Limited,PAWAR NEETI,BUY,346811,51.58,-
24-FEB-2009,EDUCOMP,Educomp Solutions Limited,C D INTEGRATED SERVICES LTD,SELL,325510,1593.77,-
24-FEB-2009,EDUCOMP,Educomp Solutions Limited,GENUINE STOCK BROKERS PVT LTD,SELL,96695,1591.71,-
24-FEB-2009,EDUCOMP,Educomp Solutions Limited,P R B SECURITIES PRIVATE LTD,SELL,111453,1590.16,-
24-FEB-2009,EDUCOMP,Educomp Solutions Limited,VAR INS PHODS FD II CONTRA FD PORTF,SELL,122231,1595.74,-
24-FEB-2009,NIITTECH,NIIT Technologies Limited,PACE SERVICES LIMITED,SELL,346341,51.59,-

Post Session Commentary - Feb 24 2009

Indian market ended slightly below the dotted line after trimming most of its earlier losses on expectations that RBI may cut policy rates to support the economy. Along with this reports that the government is ready to cut excise duty beyond March 2009, also added to the sentiments. Besides, firm US index futures too contributed to the recovery. Earlier, during the trading, concern over global financial systems after steep losses on the US market, took huge beating on the bourses. Stocks slipped on news that Standard & Poor''s, global rating agency revised the outlook on the long-term sovereign credit rating on India to negative from stable.

The domestic market today opened on weak note tracking negative cues from the markets all over the world. The US markets on Monday plunged to their lowest levels in nearly 12 years due to uncertainties about the recent US government action to shore up struggling banks. Benchmark indices were lower on intense selling pressure led by fresh worries over the global financial system. However, market was showing sign of recovery on hope of duty cuts. Finance Minister, Pranab Mukherjee is ready to cut excise duty by additional 2% and to cut service tax to 10%. FM has cut excise duty on bulk cement to 8%, which will be applicable beyond March 31. He also said states will be allowed to borrow 3.5% of GSDP in FY10. Stocks recovered sharply to minimize its initial losses during final hours contributed by short covering ahead of monthly derivative expiry on 26th February 2009. BSE Sensex ended below 8,850 mark and NSE Nifty closed below 2,750 level. From the sectoral front, most of the selling was seen in Metal, Bank, PSU, Pharma, Capital Goods, Tack and IT stocks. However, Consumer Durables, FMCG, Auto and Oil & Gas stocks remained in limelight as witnessed most of the buying from these baskets.

Among the Sensex pack 17 stocks ended in red territory and 13 in green. The market breadth indicating the overall health of the market remained weak as 1613 stocks closed in red while 790 stocks closed in green and 90 stocks remained unchanged in BSE.

The BSE Sensex closed lower by 21.15 points at 8,843.21 and NSE Nifty ended slightly down by 2.55 points at 2,733.90. Broader market indices were in red as BSE Mid Caps and Small Caps ended with losses of 49.27 points and 44.48 points at 2,742.45 and 3,116.11 respectively. The BSE Sensex touched intraday high of 8,856.52 and intraday low of 8,619.22.

Losers from the BSE Sensex pack are HDFC (4.78%), Tata Steel (4.46%), Sun Pharma (1.94%), Sterlite Industries (1.85%), SBI (1.75%), TCS Ltd (1.57%), Wipro Ltd (1.44%) and Tata Motors (1.23%).

Gainers from the BSE Sensex pack are M&M Ltd (4.92%), Ranbaxy Lab (3.94%), Gasim Indus (3.01%), DLF Ltd (1.48%) and HUL (1.46%).

On the global markets front the Asian markets which opened before the Indian market, closed lower with Shanghai Composite, Nikkei 225, Hang Seng, Seoul Composite and Straits Times index are trading down by 105.12, 376.58, 107.60, 16.25 and 35.67 points at 2,200.65, 12,798.52, 7,268.56, 1,614.44 and 1,063.88 respectively. Asian stocks tumbled sharply on the back of a sharp fall in the US markets.

European markets which opened after the Indian market are also trading down. In London FTSE 100 is trading lower by 41.95 points at 3,808.78 and in Frankfurt the DAX index is trading down by 100.63 points at 3,835.82.

The BSE Metal stocks closed down by (2.31%) or 108.40 points at 4,584.07 on worries that weakening economy may reduce technology spending. Main losers are JSW Steel (6.54%), Tata Steel (4.46%), Steel Authority (4.22%), Welspan Gujarat SR (4.09%) and Jindal Saw (3.47%).

The BSE Bank index lost (1.36%) or 58.52 points at 4,240.39 due to the fears of rising defaults in present economic condition. Main losers are Karnataka Bank (6.86%), Indian Overseas Bank (6.27%), Allahabad Bank (5.08%), Punjab National Bank (4.70%) and Bank of Baroda (3.61%).

The BSE PSU index also ended down by (0.71%) or 35.42 points at 4,931.06. Losers are Syndicate (14.58%), Andhra Bank (7.27%), J&K Bank (6.81%), Indian Overseas Bank (6.27%) and St Trad Corp (5.78%).

The BSE Pharma index ended lower by (0.53%) or 13.78 points to close at 2,582.49. Wockhardt Ltd (6.80%), Dishman Pharma (6.10%), Aurobindo Pharma (4.90%), Bil care Ltd (4.04%) and Biocon Ltd (3.48%) ended in negative territory.

The BSE Consumer Durable index gained (0.73%) or 11.47 points to close at 1,575.60. Titan Ind (3.25%) ended in green.

The BSE FMCG index closed with increase of (0.21%) or 4.25 points at 2,012.82. Scrips that gained are HUL (1.46%), Tata Tea Ltd (1.38%) and ITC Ltd (0.28%).

ICICI Bank is ended lower by 0.13%. The bank said that it will go even slower in disbursing auto loans, unless there is clarity on the repossession norms for vehicles. The bank on an average disbursed around Rs 900 crore every month as vehicle loans in 2007-08. In the current fiscal, this figure has come down to about Rs 400-450 crore.

Nagarjuna Construction Company lost 2.75% on reports Andhra Pradesh state government has cancelled a Rs. 1,000-crore project awarded to a consortium led by the company for building a multi-utility complex in New Delhi.

Tata Metaliks ended down by 0.56%. At present the company is reviewing its expansion project in West Bengal on similar grounds that Tata Motors relocated its Nano project from the state to Gujarat. The West Bengal Industrial Development Corporation (WBIDC), which has been acquiring land in Kharagpur for Tata Metaliks'' diversification project, has already started discussion with the company. But land prices remain a contentious issue.

ONGC gained 1.17% despite fall in crude oil prices. Oil prices extended declines on Tuesday, sliding toward $38 on growing economic worries after US stocks slumped to a 12-year low at the previous day''s close.

M&M Ltd gained 4.92%. The company is increasing Xylo production due to increase in its demand with five weeks wait in period. Booking of Xylo have crossed the 4,000 mark since launch.

Heavyweights lead intraday rebound as govt cuts indirect taxes

Key benchmark indices surged to trade in green for a brief period and settled with small losses after the Indian government cut excise duties further and lowered service tax rates in a move to protect the economy from the impact of the global economic crisis. The BSE 30-share Sensex was down 21.15 points, or 0.24%, off close to 200 points from the day's low.

A bout of volatility was witnessed in the latter part of the trading session. The market slipped in mid-afternoon trade after the global rating agency Standard & Poor's revised the outlook on the long-term sovereign credit rating on India to negative from stable. Just before the news of S&P cutting the outlook which hit the market in mid-afternoon trade, a solid recovery was witnessed on the domestic bourses.

The BSE Sensex plunged as much as 2.53% in early trade on setback in Asian stocks. The sharp sharp slide took it to the lowest level in more than 2-1/2 months. It wiped out almost the entire losses at about 13:50 IST just before the news of the S&P cutting the outlook.

Government' announcement of the reductions in indirect taxes hit the market in late trade and took the Sensex in green. However, the barometer index slipped into the red again later.

Finance Minister Pranab Mukherjee in his reply to a debate on the 2009/10 interim budget cut excise duty across the board to 8% from 10 %, and reduced the service tax rate to 10% from 12% on all taxable services. Mukherjee also said excise duty cuts of 4% unveiled earlier as part of a government stimulus package would be extended into the new fiscal year. He also reduced the excise duty on bulk cement to 8% and extended the exemption on customs cut on naphtha beyond 31 March 2009.

Mukherjee also announced that goods that attract 10% excise duty will now be charged at 8%. However, excise rates on items that attract 8% and 4% excise duty will not be changed.

However, according to research head of a domestic brokerage, the impact of the latest government measures to either to prop up consumer demand or the economy at large would not be significant.

Higher US index futures also supported domestic bourses. Trading in the US index futures showed Dow could rise 60 points at the opening bell on Tuesday, 24 February 2009. But sustained selling by foreign institutional investors kept market sentiment edgy.

Meanwhile, S&P said the revision in rating outlook of India was due to deterioration of the fiscal positions of the government to level that is unsustainable in the medium term. S&P expects government deficit, including off-budget measures such as oil and fertilizer bonds, to increase to 11.4% in the fiscal year ending 31 March, 2009, from 5.7% in the previous fiscal year.

Standard & Poor's has, nonetheless, affirmed its 'BBB-' long-term and 'A-3' short-term sovereign credit ratings on India.

Volatility is likely to remain high in the near term ahead of the expiry of futures & options contracts for February 2009 series on Thursday, 26 February 2009. As per reports, rollover of Nifty positions from February 2009 series to March 2009 series stood at 40% while marketwide rollover of positions was 29%, as on Friday, 20 February 2009.

Heavy sales by foreign funds this year has hit market sentiment. Foreign funds were sellers through most of last week. FII outflow in February 2009 totaled Rs 1,180.70 crore (till 19 February 2009). FII outflow in calendar year 2009 totaled Rs 5,425.90 crore (till 19 February 2009).

European stocks slipped on Tuesday, echoing sharp losses on Wall Street and in Asia as lingering fears over the stability of the banking sector rattled investors. The key benchmark indices in France, Germany and UK fell by between 0.85% to 1.57%.

Asian shares slumped on Tuesday, some to multiyear lows, after a broad sell-off on Wall Street left the Dow Jones Industrial Average at levels not seen since 1997. Key benchmark indices in China, Singapore, Taiwan, South Korea, Hong Kong fell by between 1.06% to 4.56%.

Japan's Nikkei stock average fell 1.46% dragged lower by exporters such as Canon Inc.

Led by industrials and materials stocks, the US market fell on recessionary fears and heightened risk aversion, which also drove investors to the dollar. The Dow Jones industrial average dropped 250.89 points, or 3.41%, to 7,114.78, its lowest close since 7 May 1997. The Standard & Poor`s 500 index fell 26.72 points, or 3.47%, to 743.33, lowest finish since 11 April 1997. The technology-laden Nasdaq Composite index lost 53.51 points, or 3.71%, to 1,387.72.

Although US financial stocks actually rose on hopes that the government will move soon to secure its most troubled banks, the wider issue of the fragility of the US banking system remains to the fore.

The BSE 30-share Sensex was down 21.15 points, or 0.24%, to 8,822.06. At the day's high of 8,856.52 Sensex gained 13.31 points in late trade. At the day's low of 8,619.22, the Sensex lost 223.99 points in early trade and was the lowest level for the Sensex since 3 December 2008.

The S&P CNX Nifty was down 2.55 points, or 0.09%, to 2,733.90.

The barometer index BSE Sensex has lost 812.68 points or 8.43% to 8,822.06 from a recent high of 9,634.74 on 13 February 2009. The Sensex is down 825.25 points or 8.55% in calendar 2009 from its close of 9,647.31 on 31 December 2008.

The market breadth, indicating the overall health of the market, was weak on BSE with 1,627 shares declining as compared with 810 that advanced. A total of 67 shares remained unchanged.

The BSE clocked a turnover of Rs 2,448 crore, lower than Rs 2,615.54 crore on Friday, 20 February 2009.

Nifty February 2009 futures were at 2726, at a discount of 7.90 points as compared to the spot closing of 2733.90. Turnover in NSE's futures & options (F&O) segment rose to Rs 45,693.52 crore from Rs 43,149.65 crore on Friday, 20 February 2009. The near-month February 2009 derivatives contract will expire on Thursday, 26 February 2009.

From the 30 share Sensex pack 17 stocks fell while rest gained.

The BSE Consumer Durables index (up 0.73%), the BSE FMCG index (up 0.21%), the BSE Auto index (up 0.06%), the BSE Oil & Gas index (up 0.03%), the BSE Realty index (down 0.06%), the BSE Power index (down 0.06%), the BSE IT index (down 0.14%) outperformed the Sensex.

The BSE Metal index (down 2.31%), the BSE Bankex (down 1.36%), the BSE PSU index (down 0.71%), the BSE Healthcare index (down 0.53%), the BSE Capital Goods index (down 0.48%), the BSE TECk index (down 0.3%) underperfomed the Sensex.

India's largest private sector company by market capitalization
and oil refiner Reliance Industries (RIL) fell 0.02% to Rs 1,253.30 on fears a worsening global economy will hit demand for petrochemicals. Nevertheless, the stock came off the day's low of Rs 1,201.10.

India's largest oil exploration firm by revenue ONGC rose 1.17% to Rs 680.60, off day's low of Rs 656.25, on reports the company has discovered oil in the hydrocarbon rich Krishna Godavari basin.

But other oil & gas stocks, GAIL (India), Essar Oil and Reliance Petroleum fell by between 0.26% to 1.65%.

Market to head lower

After witnessing a sharp slump of 200 points in Friday's trades, the market is likely to remain shaky as global markets fell further and the FIIs remaining net sellers of equities in the local market. Among the key domestic indices, the Nifty may get support at 2705 and a break below this level could see the index slip further to 2660. The Sensex has a likely support at 8690 and may test higher levels at 8990.

US indices slumped on Monday as investors continue to worry that the government's efforts to slow the recession won't be sufficient.
The Dow ended lower at 7115 down 251 points, while the tech-laden Nasdaq declined to close 54 points lower at 1388.

Indian floats had a weak outing on the US bourses. Except Dr Reddy all fell sharply. Rediff tumbled 6.24%, HDFC Bank slipped 4.31% and VSNL, ICICI Bank, Tata Motors, ICICI Bank, Wipro and Infosys dropped over 1-3% each.

Crude oil prices in the international market edged lower, with the Nymex light crude oil for April delivery lost by $1.59 to close at $38.44 per barrel. In the commodity space, the Comex gold for April series declined $7.20 to settle at $995 a troy ounce.

Asian markets in the red

Asian stocks declined, as the global recession hurt company earnings and forced share sales to bolster balance sheets.

Nomura Holdings fell more than 8.5%. PetroChina declined more than 4%. Baoshan Iron & Steel Codecreased more than 2%.

Japanese benchmark index Nikkei fell 191.66 points, or 2.60%, to trade at 7,184.50.

Hong Kong`s Hang Seng index declined 479.47 points, or 3.64%, to trade at 12,695.63.

China`s Shanghai Composite dropped 55.03 points, or 2.39%, to trade at 2,250.75.

Taiwan`s Taiex index decreased 59.59 points, or 1.33%, to trade at 4,418.19.

South Korea`s Kospi index slipped 85.08 points, or 3.68%, to trade at 2,230.02.

Singapore`s Straits Times declined 36.69 points, or 2.25%, to trade at 1,594. (8.54 a.m., IST)

Pre Session Commentary - Feb 24 2009

Today domestic markets are likely to open with a negative gap as the US markets fell drastically on Friday and the other Asian markets have also opened with huge losses. The sentiments are very fragile across the globe as the macro economic outlook of the world is showing signs of further deterioration. The domestic investors are likely to follow the global cues and therefore today one could anticipate risk aversion. Huge selling pressure could claw down the markets to low levels.

On Friday, the markets opened with huge negative gap after a shattering US and other Asian markets. The US initial jobless claims totaled at 6.20 lakh higher than the expected 6.27 lakh claims brought more worries in the US markets which devastated the sentiments across the world. Asian markets opened with blood bath and the domestic markets were never late to follow the bearish trend. The front line stocks were brutally shattered and heavyweights like ICICI bank, Rcom, Reliance Infra and TCS were the top losers in the sensex as they lost 7.07%, 4.55%, 3.38% and 3.23% respectively. The top laggards in the sectoral indices were Bankex, IT, Metal, Teck and Oil & Gas that fell by 3.49%, 2.69%, 2.67%, 2.21% and 2.17% respectively. During the session we expect the markets to be trading in deep red.

The BSE Sensex closed low by 199.42 points at 8,843.21 and NSE Nifty ended with a fall of 52.90 points at 2,736.45. The BSE Mid Caps and Small Caps ended with losses of 46.68 points and 53.51 points at 2,791.72 and 3,160.59 respectively. The BSE Sensex touched intraday high of 8,943.78 and intraday low of 8,762.58.

On Friday, the US stock markets closed in red. There was no specific economic news on the markets and investors were little skeptic about the semiannual monetary policy to be announced by Ben Bernanke on Monday. The government is likely to infuse more money into the Citi Group to further increase its’ stake and there are also apprehensions about Vikram Pandit to loose his job as the CEO of the Citi Group. The government had also announced their support to the financial system with temporary capital infuse. The financial stocks had gained 4.6% but sooner than later it plunged with a loss of 3% as investors recognized that the government support would only improve the capital ratios and not solve the troubles. US light crude oil for April delivery fell by $1.59 to settle at $38.44 a barrel on the New York Mercantile Exchange. There are deep demand worries that are pulling the prices of crude oil down.

The Dow Jones Industrial Average (DJIA) fell by 250.89 points to close at 7,114.78. The NASDAQ Composite (RIXF) index fell by 53.51 points to close at 1,387.72 and the S&P 500 (SPX) lost 26.72 points to close at 743.33.

Today major stock markets in Asia are trading with huge losses. Japan''s Nikkei is low by 191.66 points at 7,184.50. Hang Seng is down by 512.18 points at 12,662.92, South Korea''s Seoul Composite is low by 40.12 points at 1,059.29 and Singapore''s Strait Times is low by 39.40 points to 1,591.29.

Indian ADRs ended lower. In technology sector, Infosys ended down by 1.99% while Satyam remained unchanged. Further, Wipro ended with decrease of 2.92% while Patni Computers closed up by 1.22%. In banking sector HDFC Bank and ICICI Bank lost 4.31% and 2.90% respectively. In telecommunication sector, Tata Communication dropped by 3.15% and MTNL remained unchanged. However, Sterlite Industries decreased by 3.64%.

The FIIs on Friday stood as net sellers in equity and debt. Gross equity purchased stood at Rs 941.30 Crore and gross debt purchased stood at Rs. 435.40 Crore, while the gross equity sold stood at Rs. 1,261.40 Crore and gross debt sold stood at Rs. 513.10 Crore. Therefore, the net investment of equity and debt reported were Rs (320.20) Crore and Rs (77.70) Crore respectively.

On Friday, the Indian rupee closed at 49.72/74, 0.2% weaker than its previous close of 49.61/63. The rupee fell as the stock markets crashed badly due to weak global cues and therefore the worries of foreign capital outflow and low inflow made the dollar costlier.

On BSE, total number of shares traded were 20.73 Crore and total turnover stood at Rs 2,615.54 Crore. On NSE, total number of shares traded were 42.65 Crore and total turnover was Rs 6,459.71 Crore.

Top traded volumes on NSE Nifty – Unitech with 25148296 shares, DLF with 13971050 shares, ICICI Bank with 12628960 shares, Suzlon with total volume traded 10910517 shares followed by SAIL with 7777259 shares.

On NSE Future and Options, total number of contracts traded in index futures was 993145 with a total turnover of Rs 12,693.45 Crore. Along with this total number of contracts traded in stock futures were 890639 with a total turnover of Rs 9,987.29 Crore. Total numbers of contracts for index options were 1421380 with a total turnover of Rs 19,676.03 Crore and total numbers of contracts for stock options were 71603 and notional turnover was Rs 792.88 Crore.

Today, Nifty would have a support at 2,662 and resistance at 2,702 and BSE Sensex has support at 8,661 and resistance at 8,769.

Market geared for dismal start on weak global cues

Key benchmark indices are likely to plunge in opening trade today, 24 February 2009, as they open after a local holiday on Monday, 23 January 2009, in sync with global equity rout on uncertainty about the latest potential US government action to shore up beleaguered banks. The SGX Nifty futures for February 2009 series were sharply lower by 51 points in Singapore.

Volatility is also likely to remain high ahead of the February series F&O expiry on Thursday, 26 February 2009. As per reports, rollover of Nifty positions from February 2009 series to March 2009 series stood at 40% while marketwide rollover of positions was 29%, as on Friday, 20 February 2009.

Asian markets were trading weak today, 24 February 2009 as concerns grew about the global financial system. China's Shanghai Composite slipped 1.16% or 26.77 pints at 2,279, Hong Kong's Hang Seng plunged 3.10% or 108.77 points at 12,766.33, Japan's Nikkei tumbled 2.60% or 191.66 points at 7,184.50, Singapore's Straits Times fell 2.10% or 24.21 points at 1,596.48, South Korea's Seoul Composite declined 3.24% or 35.67 points at 1,063.88 and Taiwan's Taiwan Weighted shed 0.99% or 44.50 points at 4,433.28.

US markets slumped on Monday, 23 February 2009 with the Dow Jones industrial average sliding to an 11-year low on Monday, 23 February 2009 as investors dumped shares on uncertainty about the latest potential US government action to shore up beleaguered banks. Making matters worse, worries about a fall-off in business and consumer spending on technology hurt the biggest names in the tech sector. Worries on earnings expectations for 2009 also contributed to the sell-off.

The Dow Jones industrial average dropped 250.89 points, or 3.41%, to 7,114.78, its lowest close since 7 May 1997. The Standard & Poor`s 500 index fell 26.72 points, or 3.47%, to 743.33, lowest finish since 11 April 1997. The technology-laden Nasdaq Composite index lost 53.51 points, or 3.71%, to 1,387.72.

Back home, a disappointing interim budget 2009-10 presented on 16 February 2009 and weak global markets pulled local equities sharply lower in the week ended 20 February 2009. The BSE 30-share Sensex fell 791.53 points or 8.22% to 8,843.21 and the S&P CNX Nifty lost 211.90 points or 7.18% at 2,736.45 in the week.

According to provisional data on NSE, FIIs were net sellers worth Rs 201.07 crore while mutual funds bought shares worth Rs 167.18 crore on Friday, 20 February 2009.

US markets plunge again

Dow drops to eleven year low

Stocks at Wall Street ended substantially lower on Monday, 23 February, 2009. Dow set at its record low in twelve years. Though market opened in the green, indices slipped in the red soon. The industrial sector weighed on the market sentiment today. Concerns about the health of GE worried investors today, as is the issue of the nationalization of the banks here, mainly Citigroup. But there was no major catalyst for the plunge in US stocks today.

The Dow Jones Industrial Average ended lower by 250 points at 7,114, the Nasdaq closed lower by 53 points at 1,387 and the S&P 500 closed lower by 27 points at 743. All ten sectors ended in the red today.

While Bank of America, Citigroup and JP Morgan Chase tried to be the main Dow winners today earlier during the day, GE acted as a major laggard. But at the end, even the banking stocks also slumped.

Stocks actually began the session in positive territory as investors reacted positively to word the government might increase its stake in Citigroup to 40% by converting its existing preferred shares in Citigroup into common shares.

Among earning report for the day, Honeywell announced today that the company continues to expect first quarter earnings in-line with the consensus first quarter estimate. Though the company lowered its full-year revenue estimate, it expects full-year earnings to exceed current estimate.

The auto stocks tried providing utmost support to the market. There were reports in the market that Ford reached a tentative agreement with the UAW regarding funding for benefits. Ford is expected to be able to use a mix of cash and stock.

Oil prices ended substantially lower today. Prices had been dropping in the past few sessions due to the ongoing recession concerns gripping the overall US economy and also many parts of the world. Prices also dropped today in synchronization with the fall in stocks at Wall Street.

On Monday, crude-oil futures for light sweet crude for April delivery closed at $38.44/barrel (lower by $1.59 or 3.9%) on the New York Mercantile Exchange. Last week, crude ended higher by 3.8%.

Tomorrow is also light on earnings and economic data. The consumer confidence index is slated for tomorrow. Other than that, Fed Chairman Bernanke will provide his semiannual monetary policy report to the Senate Banking Committee.

Daily Trading Calls - Feb 24 2009

Nifty (2736) Sup 2650 Res 2770

Buy ABB (399)
SL 394 Target 410, 413

Sell Axis Bank (373)
SL 378 Target 363, 360

Sell HDFC (1352)
SL 1367 Target 1320, 1310

Sell Sterlite (248)
SL 252 Target 240, 238

Sell Bombay Dyeing (140)
SL 143 Target 134, 132

Daily News Roundup - Feb 24 2009

ONGC’s onshore drilling schedules are expected to get delayed.(BL)

Andhra Pradesh (AP) government cancels a Rs11bn contract for development of multi utility AP international centre in New Delhi, awarded to the consortium, headed by Nagarjuna Construction Company.(BL)

Hotel Leelaventure repurchases US$30mn worth FCCB.(BL)

ICICI Bank to go slow on auto loans disbursal.(BL)

Kingfisher Airlines seeks permission from the petroleum ministry to extend the date for paying dues to PSU oil companies for ATF.(BS)

DLF cuts OMR project prices.(BL)

ICICI Venture, which holds 23% stake in Subhiksha, is working on a revival plan to put the company back on track.(ET)

Bombay Stock Exchange announced 12:1 bonus issue ahead of IPO.(FE)

Spice Group head says he is interested in bidding for majority control of Satyam Computers, but would reconsider if a smaller stake was offered.(BL)

DLF in talks with banks, LIC to raise Rs10bn to pay off short term debt.(FE)

Tata Communications said it was exploring 'alternative options', including the sale of its stake in Tata Teleservices to keep its capital expenditure plans on track.(DNA)

Oil India makes deepest hydrocarbon discovery in upper Assam. (Mint)

LIC hikes stake in ICICI Bank to 9.38%.(FE)

Areva T&D India will invest Rs4.5bn more in calendar 2009 to increase equipment-making capacity at its three new plants as also existing ones.(DNA)

Suzlon mulls power plant in Bagalkot.(BS)

CCEA approved the proposal of NTT DoCoMo to acquire 27.3% stake in Tata Teleservices for about Rs129bn.(ET)

Reliance Industries to acquire clean storages in the US East Coast and Gulf Coast to sell huge volumes of fuel.(FE)

Banks refuse to finance term loans of Hindustan Oil Exploration Co, which it sought for development of its PY-I field in the Cambay basin.(BS)

Hindustan Zinc’s silver output to touch 100 tons this fiscal.(BL)

Power Grid plans to form a joint venture with a private sector firm outside India to secure international orders.(Mint)

Lanco Infratech has emerged as the lowest bidder for the much-delayed 1,600MW Dhopave coastal power plant.(DNA)

Essar Oil plans to divest stakes in its three oil blocks in Vietnam and Australia to raise funds for exploration and production.(BS)

Bharat Electronics signs an agreement with US aircraft manufacturer Boeing to jointly set up a facility to help modernize India's defence forces.(ET)

Centre has alleged Maytas Infrastructure to have diverted money raised from public to group companies.(FE)

Aurobindo Pharma got tentative approval from US FDA for Tenofovir Disoproxil Fumarate tablets.(FE)

Scar to Oscar...Jai Ho!

It doesn’t matter where you come just matters where you are headed

The stock markets continue to perform as under-dogs and are waiting for a David Boyle to tell an old recycled story better. Piling impossibility on impossibility remains a hope for bulls as global cues continue to haunt Indian market. A gap-down opening is a given. Don’t buy hoping for a miracle immediately.

The little hope that market is expecting is some measure from the RBI. The Oscars have proved you don’t need a new story. It just has to be told well. As Rehman's score wins a double delight, the bulls are yearning to scream Jai Ho!

The F&O expiry will bring its moments of anxiety as bulls and bears brush each other in a narrow range. The way investors adjust to revised market lots for fresh month contracts could widen the range.

Asian markets are already deep in the red, with the Nikkei in Tokyo and the Hang Seng in Hong Kong down well over 2.5%. Overnight, the Dow and S&P 500 tumbled to levels not seen in nearly 12 years, as investors continue to worry that the government's efforts to slow the recession won't be sufficient.

Reports say economists expect a deeper recession in the first half of the year followed by a modest recovery in the second half and a bigger recovery in 2010. Housing, manufacturing and gross domestic product growth reports are expected in US this week.

The dollar gained versus the euro and the yen. US light crude oil for April delivery fell $1.59 to close at $38.44 a barrel on the New York Mercantile Exchange. COMEX gold for April delivery fell $7.20 to settle at $995 an ounce.

Among other news in the media:

Government is in favour of selling a 51% stake in Satyam Computers to meet its working capital expenses and liabilities from the class-action suits.

ONGC strikes oil in the KG basin.

ICSA Ltd is looking to acquire a power firm in the US with an investment of $20-30mn

SBI freezes new car loans at 10%, farm loans at 8% for a year

Tata Communications may go in for a stake sale in its retail broadband unit, Tata Communications Internet Services only after the auction of WiMax spectrum.

National Aviation Co plans to borrow US$1.1bn to purchase seven aircraft from Boeing.(Mint)

Infosys Technologies has identified SAP services firms BCC and Ciber Novasoft, amongst others, as potential acquisition targets.

Reliance Industries is awaiting the Empowered Group of Ministers approval for allocating natural gas to power producers.

Reliance Power may expand capacity at Nagpur thermal power plant to 660MW. Company Law Board gives Maytas Infra additional time till February 26 for its reply to an application seeking to dissolve the present management of Maytas Infra and Maytas Properties.

TRAI asks DoT to examine Bharti Airtel’s long distance revenue reporting.

Jet Airways will lease 4 Boeing 777 aircrafts to Gulf Air.

BGR Energy Systems has won a US$8.6mn order from Iraq.

HDFC has started charging borrowers up to 3% of the outstanding loan amount as prepayment charges.

Reliance Industries opposed supplying its KG basin gas to NTPC as its legal dispute with the company is still pending at the Bombay HC.

BHEL signs an agreement to float a JV with GE to manufacture diesel locomotives for Indian Railways.

Nevyeli Lignite to set up two more lignite-based 250MW thermal power plants.

L&T may sell its fuel dispenser and other non-core businesses.

BHEL received Rs32bn order for supplying two 600MW plants for a power project in Central India.

Indian market slipped sharply on Friday on the back of a sell off in the global markets. Selling was witnessed all over the bourses with the banking, IT, metals and telecom stocks among the major loser. Finally, the BSE Sensex lost 199 points to close at 8,843 and the NSE Nifty slipped 53 points at 2,736.

Among the 30-components of Sensex, 28 stocks ended in negative terrain and only 2 stocks i.e. ACC and Maruti ended with gains in the Sensex.

Shares of ABB bounced back sharply after the company posted a net profit of Rs1931.19mn for the quarter ended December 31, 2008 as compared to Rs1807.88mn for the quarter ended December 31, 2007. Total Income has increased from Rs18648.02mn for the quarter ended December 31, 2007 to Rs22170.05mn for the quarter ended December 31, 2008. Quarter ended result is unaudited.

The scrip rose by 1.6% to Rs399 after hitting an intra-day high of Rs405 and a low of Rs365 and recorded volumes of over 23,00,000 shares on NSE.

Shares of Torrent Power ended flat at Rs72. Reports stated that the company emerged the highest bidder for the distribution franchisee for Kanpur. The scrip touched an intra-day high of Rs72.5 and a low of Rs71 and recorded volumes of over 85,000 shares on NSE.

Shares of Ashok Leyland advanced by a percent to Rs15.41 after reports stated that the company would supply 500 more buses to Angola by March-end. The scrip touched an intra-day high of Rs15.5 and a low of Rs15.1 and recorded volumes of over 19,00,000 shares on NSE.

Satyam erased gains and fell 1.4% to close at Rs45.5. The stock had earlier surged after the Company Law Board (CLB) on Thursday allowed Satyam Computer to sell a stake to a strategic investor via an open competitive bidding process.

The process of selecting a suitable strategic partner for Satyam should be transparent, the CLB said in a statement today. It added that it will appoint a retired supreme court judge to oversee the process of open bidding for acquiring a stake in Satyam. Click here to read more…

The scrip touched an intra-day high of Rs49.9 and a low of Rs44 and recorded volumes of over 3,00,00,000 mn shares on NSE.

Over the status of various government actions, Educomp clarified that there are no fresh probe or inspection ordered by the government. Shares of Educomp plunged by over 12% to Rs1772 after hitting an intra-day high of Rs1989 and intra-day low of Rs1710 recording volumes of over 28,00,000 shares on the NSE.

Shares of RCom declined by 4% to Rs155 after reports stated that the government planning a special audit on the company and its subsidiaries. The scrip touched an intra-day high of Rs160 and a low of Rs153 and recorded volumes of over 62,00,000 shares on NSE.

SGX Nifty Live Update - Feb 24 2009

SGX Nifty currently trading at 2,690.0 and is -45.0 points

Bullion metals turn little pale

Gold drops from the $1,000 mark

Bullion metal prices ended lower on Monday, 23 February, 2009. With this fall, gold which was back above $1,000 level roughly after a year, was once again back at its $900 level. The drop in prices was mainly due to selling by traders who booked profits after gold's surge in past couple of days. Deep recession fears have been increasing the appeal of the precious metals as a safe haven against alternatives since past few days.

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 and also vice versa.

On Monday, Comex Gold for April delivery fell $7.2 (0.7%) to close at $994.6 an ounce on the New York Mercantile Exchange. Last week, gold ended roughly higher by 5.5%. For January, 2009, gold had gained 3.9%. Year to date, gold prices are higher by 13%.

On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped significantly (12%) since then.

On Monday, Comex silver futures for March delivery fell 4 cents (0.3%) to end at $14.45 an ounce. Year to date, silver has climbed 28.2% this year. For 2008, silver had lost 24%.

The World Gold Council reported last week that demand for gold surpassed $100 billion last year for the first time ever, amid increased industrial and jewelry consumption and investors' purchase of the metal as a safe haven. Gold demand - including jewelry consumption, industrial demand and identifiable investments such as bars, coins and gold exchange-traded funds - hit $102 billion in 2008, up 29% from a year ago. In tonnage terms, gold demand rose 4% to 3,659 tons.

In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.

Last year, the weakening dollar and higher global demand for raw materials had led to records for commodities including gold. Gold reached a record in March 2008 as a U.S. housing slump and credit crisis spurred the Federal Reserve to slash borrowing costs. In the last move, the Federal Reserve has cuts its target bank lending rate to 0.25% from 5.25% in September, 2007. The Fed did it in nine steps.

Prior to 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. Silver had climbed 16% in FY 2007. In 2006, silver had jumped 46% while gold gained 23%.

Hindustan Oil Exploration

We recommend a buy in Hindustan Oil Exploration Company stock from a short-term trading perspective. It is apparent from the charts of the company that it was on an intermediate-term downtrend from its August 2008 peak of Rs 144 to its February 2009 low of Rs 50.

However, the stock found support around Rs 50, and bounced by almost 9 per cent on February 20. Accompanied with high volume, this up-move of the stock conclusively broke through the 21-day moving average as well as intermediate-term down trendline. The stock has a significant long-term support at Rs 50. The daily relative strength index (RSI) is rising in the neutral region towards the bullish zone and weekly RSI has recovered from the oversold territory.

The price rate of change indicator has entered the positive territory that indicates increase in buying pressure. Considering the recent break-through and the presence of significant support at Rs 50, we are bullish on the stock from a short-term horizon. We expect the stock to rally until it hits our price target of Rs 64 in the upcoming trading sessions. Traders with short-term perspective can buy the stock while maintaining a stop-loss at Rs 54.

via BL

Crude falls

Prices end lower after US stocks plunge

Oil prices ended substantially lower on Monday, 23 February, 2009. Prices had been dropping in the past few sessions due to the ongoing recession concerns gripping the overall US economy and also many parts of the world. Prices also dropped today in synchronization with the fall in stocks at Wall Street.

On Monday, crude-oil futures for light sweet crude for April delivery closed at $38.44/barrel (lower by $1.59 or 3.9%) on the New York Mercantile Exchange. Last week, crude ended higher by 3.8%.

Prices reached a high of $147 on 11 July, 2008 but have dropped almost 74% since then. Year to date, in 2009, crude prices are lower by 11.9%. On a yearly basis, crude prices are lower by 65%.

In Wall Street on Monday, indices continued to linger in the red. Though market opened in the green, indices slipped in the red soon after. The industrial sector weighed on the market sentiment today. Concerns about the health of GE are worrying investors today, as is the issue of the nationalization of the banks here, mainly Citigroup.

Prices had been sliding since past couple of days after fear gripped the US economy that US banks might be nationalized. The gear eased a bit after President Barack Obama said that he is in favour of “privately owned” banks.

Recently, Paris based, IEA has reported that this year's global oil demand will fall by 1 million barrels a day, or 1.1%, from last year. If realized, it will be the biggest yearly drop since 1982. The IEA cited a worsening economic outlook across all regions as the reason for the weakness in oil demand.

Crude prices had ended FY 2008 lower by 54%, the largest yearly loss since trading began at Nymex.

OPEC has been trying to cut production consistently in order to step up prices from their current low levels. OPEC agreed to reduce production by a record amount of 2.2 million barrels a day, starting from 1 January, 2009 adding to previous cuts of 2 million barrels. Overall, the reduction is equal to about 5% of the world's oil demand.

Against this background, March reformulated gasoline futures lost 2.9% to $1.0433 a gallon and March heating-oil futures fell 1.8% to $1.1754 a gallon.

Natural gas for March delivery added 2.1% to $4.093 per million British thermal units.

LIC increases stake in ICICI Bank

Life Insurance Corporation of India (LIC) today said it has purchased 2.27 crore shares of country's largest private sector lender ICICI Bank.

LIC now holds over 10.44 crore shares representing 9.38 per cent stake in the bank.

In a filing to the National Stock Exchange, the bank said that LIC has purchased 2.27 crore shares representing 0.048 per cent stake in the bank.

On Friday, shares of ICICI Bank closed at Rs 335.85, down 7.10 per cent on the NSE.