Nifty has to stay above 6650 for a short rally
The S&P BSE Sensex opened Friday with a highest opening gap since 2 April 2014. However, the gap up opening was used by investors to sell. Each effort of reviving was followed with the indices moving lower. In the last few minutes of the session the benchmarks entered in the negative zone and finally closed marginally lower.
The Sensex opened at 22,494 while the NSE 50-share Nifty opened at 6,710. Sensex moved lower to the level of 22,387 after reaching upto 22,576 and closed at 22,404 (down 14 points or 0.06%). Nifty hit a high of 6,738 and moved lower to the level of 6,690 and closed at 6,695 (down 2 points or 0.02%). The NSE recorded a low volume of 67.35 crore shares.
Eight core sector industries increased their output by 2.5% in March as against 7% in the same month in 2013. On account of higher output from coal, petroleum, steel and electricity, the eight key infrastructure industries grew by 2.5% in March. The core sectors grew by 4.5% in February, while in January, the industries had grown by 1.6%. Overall, the core sector industries grew by 2.6% in FY14 compared to the 6.5% in FY13.
Coal production grew by 0.7% in March 2014 compared to the same month in 2013. Steel production and electricity generation also grew by 5.4% each in March 2014 compared to March 2013.
Market today awaited Markit Economics to unveil HSBC India Manufacturing PMI (PMI) for April 2014 today. Unchanged from March's reading of 51.3, the seasonally adjusted PMI indicated a further improvement in operating conditions during April.
Coal India was among the top three gainers in the Sensex 30 pack. Coal India clsoed 1.3% up at Rs295.5 on the BSE. The union government has set unrealistic targets for Coal India this year after the company fell 4.21% short of its production target to 462.53 million tonnes (mt) in 2013-14. The production and offtake targets for 2014-15 are 507 mt and 520 mt, respectively. The company’s performance grew only 2.3% and 1.4%, respectively, on these indicators in the last financial year.
Maruti Suzuki car sales in April 2014 fell by 11.40% over the year ago period. During the month, the carmaker sold 86,196 units compared with 97,302 units in the corresponding month last year. The highest fall was witnessed in sales of SX4 while the compact segment comprising Swift, Estilo, Ritz and Celerio recorded a growth in sales of 9.9%. Maruti Suzuki was among the top five losers in the Sensex 30 stock. It ended 1.7% down at Rs1885.5 on the BSE.
After posting a marked growth in the revenue for March 2014 quarter Marico today came up a top gainer in ‘A’ group on the BSE.
Jindal Steel is in news for competing in talks to buy parts of insolvent Italian steelmaker Lucchini. Italy's steelmaker has tried to sell itself for years but has so far failed to attract investors. Jindal Steel was the top loser today in ‘A’ group on the BSE. Jindal Steel ended 6.5% down at Rs238.9 on the BSE.
US indices closed flat on Thursday.
Data showed applications for US unemployment benefits climbed to a nine-week high last week, while consumer spending surged in March by the most in almost five years as warmer weather brought shoppers back to auto-dealer lots and malls.
The US non-farm payrolls data is due later today.
The Institute for Supply Management's factory index rose to 54.9 in April from 53.7 in the prior month, the Tempe, Arizona-based group's report showed today. Readings above 50 indicate expansion. The ISM's factory gauge averaged 53.9 for all of last year.
Hang Seng (0.57%), NZSE 50 (0.46%) and Taiwan Weighted (0.86%) ended up. All all the other Asian indices trading today closed in the red. Straits Times (0.37%) was the top loser. China's official manufacturing purchasing managers' index rose to 50.4 in April.
European indices are trading in the green while US Futures are trading marginally higher. Euro-area manufacturing grew at the fastest pace in three months in April on accelerating expansion in Germany and Italy, evidence the currency bloc's recovery remains on track. A Purchasing Managers' Index increased to 53.4 from 53 in March, Markit Economics said in a statement today. That exceeded a preliminary reading of 53.3 published on April 23. The measure has exceeded the level of 50, indicating expansion, for the past 10 months.
The parent company of Cummins India has guided for a very weak year ahead for India with an expectation of about 15% revenue decline in powergen segment
Cummins Inc, the parent company of Cummins India, while declaring its first quarter results has expressed worries over weak demand from powergen and mining segments from the country. "In the post-results conference call, Cummins Inc further mentioned that India powergen revenues declined 46% year-on-year in US dollar terms. The parent has also guided for a very weak year ahead for India and expects 15% revenue decline in powergen segment. We retain our Reduce rating on continued slowdown overhang and expensive valuation for Cummins India," says Nomura in a research note.
According to Nomura estimates, after adjusting for the currency impact, the parent's numbers imply about 38% decline in India powergen revenues. It said, "This compares with a 26% decline that we were building in for the segment in this quarter. Note that powergen segment contributes about 30% of total sales for Cummins India."
Separately, Cummins has also upped its own revenue growth guidance for CY14 on the back of strong North American market – this might not be too positive for its Indian unit exports as North America is less than 15% of total exports for the Cummins India.
According to Nomura, notably, Kirloskar Oil Engines, one of the key competitors for Cummins India, posted better-than-expected topline for March 2014 quarter. Revenues trend improved for Kirloskar Oil Engines improved in second half of FY14, as it grew by around 6.0% compared with a decline of about 9% during first half of FY14.
"This seems to be in contrast with the implied numbers for Cummins India and might suggest that growth in high low/ mid power segment is stabilising/ recovering, while that in high HP segment continues to face headwinds," Nomura added.
Nomura said it has retained its 'reduce' rating on Cummins India with a price target of Rs385 as against the company's closing price of Rs550 as on 29 April 2014.
Cummins India closed Friday 4.5% down at Rs523.8 on the BSE, while the 30-share Sensex ended the day marginally down at 22,403.
With Elango, the entire top management of Cairn India has quit the company since billionaire Anil Agarwal-owned Vedanta in 2010 announced buying majority stake in it
Cairn India's interim chief executive P Elango has quit the company, completing the exit of all of the tier-1 management of the company since it was acquired by mining group Vedanta Resources plc.
Elango, who was named interim CEO in August 2012 when the the company's face Rahul Dhir resigned, cited "personal reasons" for the decision to step down, Cairn said in a statement.
The move came as a surprise as Elango, under whom Cairn touched 200,000 barrels per day of output from its showpiece Rajasthan oilfields, was widely tipped to become the full-time CEO of the company.
Last year, Elango was given a 40% hike in salary, suggesting that he would be taking on a larger role within the company but promoter Anil Agarwal group continued him as interim CEO.
Cairn said the company board has accepted Elango's resignation and added Sudhir Mathur, chief financial officer, has taken over additional charge as interim CEO.
"Tom Albanese, CEO Vedanta Resources plc, and Mike Yeager, Chairman, Operations Review Board, Cairn India, will continue to work closely with the leadership team in managing the business under the guidance of the Board," the statement said.
With Elango, the entire top management of Cairn India has quit the company since billionaire Anil Agarwal-owned Vedanta in 2010 announced buying majority stake in the firm from Scottish explorer Cairn Energy Plc.
Rick Bott, who was Executive Director and Chief Operating Officer of Cairn India, quit the firm on June 15, 2011, while its Executive Director and Chief Financial Officer Indrajit Banerjee resigned with effect from August 23, 2011.
David Ginger, Cairn India's director of exploration and new ventures, quit the firm shortly after that and Dhir put in his paper after the Cairn-Vedanta deal was completed. Company's Director, Commercial and New Business Ajay Gupta quit the firm in January 2013.
In February this year, Sundeep Bhandari, the man credited with laying the foundation and then building what is now Cairn India, quit the company. He along with Dhir, Bott, Banerjee and Ginger ran the firm before Vedanta took over.
Vedanta completed the $8.67 billion acquisition of Cairn India in December 2011.
Mathur came in from Aircel after Dhir quit.