Thursday, January 05, 2012
After enjoying two terrific sessions at the start of the new year, the Indian equity markets have entered into a consolidation phase. It may be recalled that the BSE Sensex had surged by more than 400 points on Tuesday after advancing modestly on Monday. After coming close to 4800, the NSE Nifty erased all of the session's gains and slipped into the negative terrain in late afternoon trade. During the day, the Sensex also came within striking distance of 16,000. However, it was unable to sustain the momentum.
It was another volatile session for markets, which ended on a flat note. The Sensex fell 26 points and the Nifty stood unchanged
Headlines for the day
Food inflation at -3.36% vs 0.42%
Welspun shares in demand
Hexaware Technologies says stake sale of business is speculative
Kiri Industries soars on fund raising plan
Weakness in European shares weighed on domestic bourses during the second half of the trading sessions. The barometer index, BSE Sensex, edged slightly lower. The Sensex dropped for the second day in a row. The 50-unit S&P CNX Nifty ended almost unchanged for the day. The Sensex fell 25.56 points or 0.16%, off close to 123 points from the day's high and up about 48 points from the day's low. The market breath was positive. Index heavyweight Reliance Industries (RIL) fell over 2%.
Capital goods stocks extended recent gains triggered by bargain hunting after a steep sell-off last month. FMCG stocks fell on profit taking after recent gains. Auto stocks rose as India Auto Expo 2012 began in New Delhi today, 5 January 2012. Realty major DLF fell over 4% on reports of an unfavourable court order on a major project. Metal stocks reversed initial gains as LMEX, a gauge of six metals traded on the London Metal Exchange, dropped 2.17% on Wednesday, 4 January 2012.
The start is likely to be on a quiet note tracking mixed global cues. The sentiments may remain bearish as eurozone concerns resurfaced.
Headlines for the day:
IOC may set up Rs 30,000-cr refinery in Gujarat
RIL strikes mega media deal
Adani Power to invest Rs 3,000 cr in solar power
Banks start year with sale of covered bonds
SEBI Board clears regulatory changes to allow PSU buybacks
Adani Power has approached the Supreme Court to scrap an electricity sales contract because of fuel supply uncertainty and unexpected rise in cost of imported coal, in a case that can make or break mega projects worth Rs1600bn and their lenders. (ET)
Rejecting GMR-led Delhi airports proposal for a seven-fold increase in airport charges, AERA has suggested only a three-fold rise in these tariffs in a recent consultation paper. (ET)
A consortium led by the Welspun Group is likely to get the contract to operate an international seaport at Vizhinjam in Kerala, after the union home ministry rejected Mundra Port and Special Economic Zones bid. (ET)
ONGC will buyout British energy major BG Groups stake in three of its eastern offshore oil and gas exploration blocks. (ET)
After a fantastic rally in the previous trading session, the Indian equity markets seemed to lose some steam as the early new year global rally faded and investors turned cautious ahead of important economic announcements in the coming days. Also, corporate earnings will soon start trickling in and market participants would want to hear from the management about the prospects for the coming fiscal year.
Reports that the Centre had deferred a decision on allowing PSUs to buyback their shares may just have hurt the undertone a wee bit. In the process, the market ignored the upbeat data on the services PMI, which hit a five-month peak.
Know, first, who you are; and then adorn yourself accordingly. - Epictetus.
The indices again are set to kind of oscillate in a range with no clear destination in sight. The early bounce across world stocks has tapered off a wee bit. Old worries return to haunt investors. With mixed global cues, the opening is likely to be sedate at best.
US indices settled almost static. European markets ended lower following a tepid German bond auction. Italy and Spain remain in focus amid worries about their precarious fiscal health. All eyes are on the French bond auction. Asian markets are flat to positive.
Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a fall of 9 points at the opening bell. On macro front, the government will today, 5 January 2012, unveil data on some wholesale price indices viz. the food price index, the primary articles index and the fuel price index for the year through 24 December 2011.
Volatility ruled the roost on Wednesday, 4 January 2012, as key benchmark indices flip-flopped between negative and positive territory. After a choppy start, the barometer index, BSE Sensex, shot up to the psychological 16,000 mark in mid-afternoon trade. Gains could not be sustained as the market soon reversed direction. Concerns about upcoming Q3 December 2011 earnings and weak European stocks hit investor sentiment adversely. The BSE Sensex lost 56.72 points or 0.36% to settle at 15,882.64, its lowest closing level since 2 January 2012.
Silver drops while gold ends at two week high
Precious metal prices ended mixed on Wednesday, 04 January 2012 at Comex. While gold prices ended at two-week highs, silver prices tuned pale. The gold market was under mild selling pressure in early trading on Wednesday, but traders stepped in to buy that weakness. The dollar stayed strong on Wednesday affecting commodities.
Gold for February delivery ended higher by $12.2 or 0.8%, to end at $1,612.7 an ounce on the Comex division of the New York Mercantile Exchange on Wednesday. The metal earlier veered between small gains and losses, but gathered steam as U.S. stocks started their trading day on the red. Prices shed 2.4% last week. For the year 2011, gold rose 10%.
Crude earlier trades between small gains and losses ahead of tomorrow's weekly inventory report
Crude prices ended modestly higher on Wednesday, 04 January 2012 at Nymex. Prices remained volatile earlier in the day oscillating between small gains and losses ahead of tomorrow's weekly inventory report on crude stockpiles. The report is a day late because of New Year Holiday on last Monday. Geopolitical concerns surrounding Iran and potential for conflict in the Strait of Hormuz helped prices get ground which otherwise was getting affected due to a strong dollar.