Monday, January 16, 2012
Key benchmark indices registered small gains to reach 5-1/2-week closing highs as the headline inflation hit 2-year low, which reinforced expectations that the central bank will start cutting interest rates in the coming months to revive slowing economic growth. The barometer index, BSE Sensex, advanced 34.74 points or 0.22%, up about 150 points from the day's low and off close to 25 points from the day's high. The market breadth turned positive from negative late trade.
Data showing buying by foreign funds recently underpinned sentiment. Foreign institutional investors (FIIs) bought shares worth Rs 293.51 crore on Friday, 13 January 2012, as per provisional data from the stock exchanges. FII inflow totaled Rs 1555.94 crore in four trading sessions from 10 to 13 January 2012, as per provisional data from the stock exchanges. FIIs have bought shares worth a net Rs 2183.19 crore so far in January 2012, as per provisional data from the stock exchanges.
The market is likely to open lower on weak global cues on renewed worries of the euro zone debt crisis. US markets edged lower on Friday, 13 January 2012 while Asian markets were trading lower today, 16 January 2012 after Standard & Poor's on Friday, 13 January 2012 cut the rating of nine European nations. Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a fall of 42.50 points at the opening bell.
Reliance Industries (RIL) may see action on reports the company is planning to pick up a minimum 26% stake in leading cable operators, including multi-system operators. The move is a part of the group's strategy to rope in cable operators as well as multi-system operators (MSOs) as partners to provide last-mile connectivity to consumer homes for 4G broadband services, which would include data, voice and television.
Reliance Industries is planning to pick up a minimum 26% stake in leading cable operators, including multi-system operators. (BS)
Funds belonging to the IL&FS group have picked up 9.36% stake in a subsidiary of Indiabulls Real Estate for Rs2bn. (BS)
ASK Group is on the road to raise as much as Rs30bn for two funds it is advising. (BS)
Shree Cement has placed equipment orders of nearly Rs7bn for its kiln unit in Rajasthan, even as projects amounting to more than Rs130bn are running behind schedule. (BS)
Everything that is done in the world is done by hope. - Martin Luther.
We hoped to share some brighter backdrop before the open. But alas, Friday the 13th hit the debt-stricken eurozone hard. Standard & Poor’s lowered the debt ratings of as many as nine nations. S&P stripped France and Austria of their coveted "AAA" ratings and reduced Portugal’s debt status to junk.
Separately, talks aimed at finalizing voluntary writedowns for holders of Greek sovereign debt fell through, raising concerns about a default. Greece, France and the rest of the eurozone will continue to be in focus this week as well.
The markets are expected to face pressure from the worsening eurozone crisis after a series of national ratings downgrades by Standard & Poor's that could further delay a European recovery.
Headlines for the day:
RIL plans to pick 26% stake in leading cable operators
DCB defers Rs150 crore QIP plan to June
Government owes Rs110 crore to Air India for VVIP flights
SBI trims housing loan processing fee
FIIs invest Rs15,000 crore in debt, equities this month
Prices register healthy weekly gains
Copper prices ended lower on Friday, 13 January 2012 at Comex. Copper prices fell on Friday as speculation ratings agency Standard & Poor's could downgrade a number of euro zone countries prompted a pull back in assets perceived as risky. A strong dollar also hammered prices.
Copper for March delivery ended lower by 1 cent (0.3%) at $3.64 a pound at Comex on Friday. Prices rallied 5.8% for the week. For the year 2011, copper shed 23% following a 30% increase in 2010 and a 140% jump in 2009, boosted by surging demand from China's manufacturers. China accounts for 40% of the world's refined copper consumption.
Prices register weekly gains though
Precious metal prices ended lower on Friday, 13 January 2012 at Comex. Prices fell as dollar headed up for the day on Friday. Prices also fell due to profit booking. Nevertheless, prices gained for the week.
Gold for February delivery ended lower by $16.9 or 1%, to end at $1,630.8 an ounce on the Comex division of the New York Mercantile Exchange on Friday. It fell to a low of $1,625.7 during intra day trading. For the week, gold gained 0.9%. For the year 2011, gold rose 10%.
Geo political tensions in Iran and Nigeria coupled with a strong dollar keep prices steady
Crude prices ended lower on Friday, 13 January 2012 at Nymex. Prices traded with a narrow range due to continuing geo political tensions in Iran and Nigeria coupled with a strong dollar.
Light and sweet crude for February delivery fell $0.40 (0.4%) to $98.7 a barrel on the New York Mercantile Exchange on Friday. Prices fell 2.8% for the week erasing all of last week's gain. For the year 2011, crude futures gained 8.2%.