Tuesday, June 19, 2012
The Indian stock markets ended near day's high on Tuesday at the end of a choppy session as investors returned to the street after the previous session's big sell-off. The NSE Nifty closed above the 5100 mark, led by gains in Oil & Gas, FMCG, Pharma, PSU and Capital Goods indices. The IT index finished in the negative territory. The broader market didn't participate in the rally today, with the Mid-cap and the Small-cap stocks under-performing their Large-Cap peers. Today’s smart upswing came despite the rupee declining below 56-per-dollar mark. The undercurrent remained weak in the wake of the RBI's "status quo" mid-quarter policy review, Fitch Ratings' downgrade of India's outlook and lingering fears over the simmering eurozone debt crisis. Dollar demand from domestic oil refining companies and other importers remains pretty high.
The Indian markets witnessed volatility today and closed the trade in the positive terrain. The Sensex was up by 154 points while the Nifty surged 40 points. Headlines for the day: RCom hits 52-week low on downgrade by Veritas Rupee slips 12 paise at 56.05 dollar Yellow metal hits record of Rs30,428 per 10 gm today Cement stocks rise ahead of cartelisation report\
Turnover declines Nifty June 2012 futures were at 5114.30, at a premium of 10.45 points over spot closing of 5103.85. Turnover on NSE's futures & options (F&O) segment declined to Rs 152482.69 crore from Rs 191592.93 crore on Monday, 18 June 2012. State Bank of India (SBI) June 2012 futures were at 2105.05, at a premium compared to spot closing of 2101.85. L&T June 2012 futures were at 1339.40, at a premium compared to spot closing of 1335.85. ICICI Bank June 2012 futures were at 828.80, near spot closing 827. In the cash market, the S&P CNX Nifty jumped 39.60 points or 0.78% to settle at 5,103.85, its lowest closing level since 15 June 2012. The June 2012 derivatives contracts expire on 28 June 2012.
Key benchmark indices surged in choppy trade as European stocks rose after better-than-expected results for a Spanish debt auction and on rumours that the European Central Bank would prop up Spanish government bonds, after yields on 10-year Spanish government bonds closed above 7% on Monday, 18 June 2012. The barometer index, BSE Sensex, jumped 153.97 points or 0.92%, up close to 180 points from the day's low and off about 30 points from the day's high. A statement by Prime Minister Manmohan Singh at the G20 Plenary Session said that the Indian government is determined to create an environment that will boost investor sentiment and promote an atmosphere conducive to enterprise and creativity, boosted investor sentiment. Incidentally, there have been sustained purchases of Indian shares by foreign institutional investors (FIIs) over the past few days. FIIs bought shares worth a net Rs 2693.50 crore from secondary equity markets during 9 trading sessions from 6 June to 18 June 2012, as per data from Securities & Exchange Board of India (Sebi). The Sensex has risen 641.27 points or 3.95% so far in this month (till 19 June 2012). The barometer index has gained 1,404.88 points or 9.09% in calendar 2012 so far (till 19 June 2012). From a 52-week low of 15,135.86 on 20 December 2011, the Sensex has risen 1,723.94 points or 11.38%. From a 52-week high of 19,131.70 on 8 July 2011, the Sensex has lost 2,271.90 points or 11.87%.
The Indian markets may begin the trade on a flat note on the back of mixed global cues. SGX Nifty is trading 3.50 points higher. Events for the day: Ex-date for dividend of CMC. Headlines for the day: Fitch lowers credit rating outlook of GAIL, IOC, NTPC. Fitch revises India's outlook to negative. SBI rate cut hints at deteriorating assets. Fuel retailers hold petrol prices. Airlines will cut domestic fares by 5-20%: govt.
With natural gas output from its Krishna Godavari (KG) - D6 block dipping to all-time low, Reliance Industries has proposed to drill first exploration well in almost five years on the flagging D1 and D3 gas fields there. (BS) ONGC has started commercial production of gas from the North Tapti offshore marginal gas field. (BL) Ashok Leyland has bagged a US$6.5-mn order from Bangladesh Road Transport Corporation for 88 air-conditioned buses. (BL) A large number of companies across power, steel and cement sectors, including Tata Steel, Bhushan Steel, Hindalco, Essar Power, Jindal Steel & Power, Sterlite, Adani Power, Lanco and Monnet Ispat, may find their dealings with the coal ministry being probed by the Central Bureau of Investigation in connection with the allocation of captive coal blocks between 2006 and 2009. (ET)
The Indian stocks ended with heavy losses on Monday, starting off a new trading week on a negative note. The NSE Nifty slumped ~130 points from day's high. The fall was majorly led by Banking, Realty, FMCG and PSU Stocks. Overnight gains in the US and Asian markets lifted the Nifty at open, as a favorable outcome of the Greek elections raised hope of a lasting solution to the eurozone debt crisis. Market participants were also hopeful that early gains would get extended if the Reserve Bank of India (RBI) cuts key interest rates and/or CRR. However, completely reverse happened, as markets were unable to hold on to their gains after the RBI left key interest rates unchanged. The central bank did not announce any reduction in the Cash Reserve Ratio (CRR) and the Repurchase rate (repo rate) as it was of the opinion that any easing of liquidity would fuel inflationary pressures.
The size of your success is measured by the strength of your desire; the size of your dream; and how you handle disappointment along the way. - Robert Kiyosaki. The RBI continues to surprise, this time, rather nastily with even the CRR left unchanged. Nasty surprises can be used to shake people out of a complacent state but the power’s that be have to wake up from their slumber. Future action from the RBI will hinge on the Centre taking concrete steps towards fiscal consolidation. Further worsening of the eurozone debt crisis is another scenario which could force the RBI’s hands. Markets are perhaps more upset with the RBI than Fitch, which has become the second of the top three ratings firms to cut outlook on India. Despite their sullied reputation post 2008 crisis, one can’t afford to overlook the concerns flagged by Fitch and S&P.
Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a gain of 5.50 points at the opening bell. Market will react to cut in ratings outlook on India's sovereign debt rating to negative from stable by Fitch Ratings announced after market hours on Monday. Most Asian markets were trading lower on Tuesday amid worries over the worsening euro zone debt crisis. State-run Coal India (CIL) has reportedly entered into fuel supply agreement (FSA) with 27 power units. The signings come even as the Prime Minister's Office (PMO) is slated to convene a meeting on Friday to iron out issues in the pact, mainly the penalty clause. The government had issued a presidential directive to CIL in April to sign FSAs with the power producers assuring them of at least 80% of the committed coal delivery.