Nifty, Sensex to remain weak: Monday Closing Report

Unless the Nifty closes above 5,970, the market is headed lower

The market settled in the negative as cautiousness prevailed a day ahead of the RBI’s policy review and on weak global cues. Unless the Nifty closes above 5,970, the market is headed lower. The National Stock Exchange (NSE) witnessed a lower volume of 46.79 crore shares and advance-decline ratio of 543:949.
The market opened in the negative after Cyprus, which was granted a 10 billion euro bailout package by Eurozone ministers over the weekend, decided to impose an unprecedented levy on bank deposits. The new levy also rattled markets across Asia this morning. Nervousness ahead of the Reserve Bank of India’s policy review, scheduled to be announced tomorrow, also weighed on the investors.
The Nifty resumed trade down 56 points at 5,817 and the Sensex started off 145 points lower at 19,283. The market slipped to its intraday lows in initial trade itself with the Nifty falling to 5,814 and the Sensex going back to 19,232.
The market witnessed sideways movement in the morning session in the absence of any fresh triggers. European markets, which opened with cuts of over 1% on account of the Cyprus banking levy, also weighed on the domestic market in the post-noon session.
However, buying in fast moving consumer goods, consumer durables and healthcare stocks helped the market hit its high in the last hour of trade. The Nifty rose to 5,850 and the Sensex went up to 19,345 at their highs.
The market settled off the highs in the negative on pressure from metal, PSU and auto sectors and unsupportive global cues. The Nifty settled 37 points (0.64%) down at 5,835 and the Sensex lost 134 points (0.69%) to close the session at 19,293.
Among the broader indices, the BSE Mid-cap index fell 0.29% and the BSE Small-cap index dropped 0.67%. 
BSE Fast Moving Consumer Goods (up 0.68%); BSE Consumer Durables (up 0.32%) and BSE Healthcare (up 0.30%) were the sectoral gainers today. The lop losers were BSE Metal (down 2.34%); BSE PSU (down 1.64%); BSE Auto (down 1.44%); BSE Realty (down 1.21%) and BSE Oil & Gas (down 1.20%).
Six of the 30 stocks on the Sensex closed in the positive. The main gainers were Cipla (up 1.70%); Hindustan Unilever (up 1.20%); HDFC Bank (up 0.75%); ITC (up 0.66%) and Hero MotoCorp (up 0.18%). The main losers were Coal India (down 5.41%); Tata Power (down 3.43%); GAIL India (down 3.16%); Maruti Suzuki (down 2.98%) and Sterlite Industries (down 2.68%).
The top two A Group gainers on the BSE were—Pidilite Industries (up 4.44%) and GMR Infrastructure (up 4.44%).
The top two A Group losers on the BSE were—Coal India (down 5.41%) and Engineers India (down 4.83%). 
The top two B Group gainers on the BSE were—Sowbhagya Media (up 20%) and Keltech Energies (up 19.99%).
The top two B Group losers on the BSE were—Rathi Bars (down 18.32%) and Ram Informatics (down 17.36%).
Of the 50 stocks on the Nifty, 11 ended in the green. The key gainers were Cipla (up 2.15%); HCL Technologies (up 1.38%); Siemens (up 1.18%); HUL (up 1.12%) and ITC (up 1.01%). The major losers were Coal India (down 5.72%); IDFC (down 3.49%); Tata Power (down 3.44%); Maruti Suzuki and Ambuja Cement (down 3.09% each).
Markets in Asia closed lower on the back of issues pertaining to bailout issues in Cyprus. This apart, new curbs on real estate purchases in China also dented sentiments.
The Shanghai Composite tanked 1.68%; the Hang Seng dropped 2%; the Jakarta Composite fell 0.34%; the KLSE Composite declined 0.39%; the Nikkei 225 tumbled 2.71%; the Straits Times declined 0.90%; the Seoul Composite contracted 0.92% and the Taiwan Weighted settled 1.47% lower.
At the time of writing, the key European markets were down between 0.78% and 1.37% while the US stock futures were sharply lower, indicating a subdued opening for US stocks later in the day.
Back home, foreign institutional investors were net buyers of shares amounting to Rs1,018.94 crore on Friday while domestic investors were net sellers of equities totalling Rs584.48 crore. 
Infrastructure developer, IL&FS Engineering and Construction Company, has received a letter of award from Cairn India for a buildings and structures project valued at Rs52.47 crore. The project, which involves construction of staff quarters, guest house, administration, cafeteria, mess, boys’ hostel, girls’ hostel, academic, etc, is to be completed in 15 months. The stock declined 0.82% to close at Rs54.15 on the NSE.
Mangalore Refinery and Petrochemicals will construct the Government Lady Goschen Hospital in Mangalore as part of its corporate social responsibility. To be built at a cost of Rs21.70 crore, the hospital will come up on 12,000 sq ft of area in the next three years. MRPL climbed 2.39% to close at Rs53.50 on the NSE.



Yet another bank fined in the US for a Magnetar deal, with yet more revealing emails

Deutsche Bank agrees to pay $17.5 million to Massachusetts for a deal involving Magnetar, the hedge fund behind many CDOs gone sour

Deutsche Bank is the latest financial institution to be fined for not warning investors about the role of the hedge fund Magnetar in creating complex mortgage-backed deals that later failed.


As we detailed in 2010 with This American Life and NPR’s Planet Money, Magnetar helped create $40 billion worth of deals. The hedge fund, meanwhile, had taken positions that allowed it to profit when many of those same deals collapsed. Since ProPublica reported on Magnetar's dealings three years ago, there's been a long line of investigations and settlements related to the firm.

A Massachusetts financial regulator fined Deutsche Bank $17.5 million Wednesday, saying that the bank did not disclose the role of a securities unit or Magnetar in structuring one such deal – a collateralized debt obligation known as Carina CDO Ltd.


In marketing the deal to investors, Deutsche Bank also did not reveal that Magnetar planned to bet against some of the assets in Carina.

“There is not a single reference in Carina’s sales and marketing materials relating to conflicts of interest,” wrote Massachusetts Secretary of the Commonwealth William Galvin in an order released yesterday.


Carina was worth $1.56 billion, and went bust in 2007, just a year after it was created. Carina was one of the deals described in ProPublica’s articles.


In reaching the settlement, Deutsche Bank did not admit or deny the charges against it. That’s also been the case in other settlements related to Magnetar deals. Such settlements now total more than $300 million. A spokeswoman for Deutsche Bank said, “We are pleased to have reached this settlement and put this matter behind us.”


Magnetar has never been charged with any wrongdoing related to the creation of the deals and has always maintained it did not select the assets that went into its CDOs and that it was "market neutral," meaning it would make money whether housing rose or fell. Magnetar has not responded to our latest request for comment.


Emails quoted in the order suggest Magnetar and Deutsche Bank’s securities unit working in tandem to structure Carina:

"create a deal that Magnetar likes" (p. 16)


Moneylife Foundation seminar on Life Insurance:“Online term plans can be deceptive”

Moneylife Foundation held a session on life insurance which discussed charges, returns and...

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