Nifty, Sensex will continue to weaken: Tuesday Closing Report

Nifty may try to bounce back but may get stalled at 5,820

The market closed in the red for the third straight day following the pullout of the DMK from the ruling UPA led coalition government at the Centre. A statement by the RBI in its mid-quarter policy review that, “headroom for further monetary easing remains quite limited” added to the gloom among investors. The Nifty may try to bounce back but may get stalled at 5,820.
The National Stock Exchange (NSE) recorded a turnover of 72.30 crore shares and advance-decline ratio of 343:1176.
The market opened in the positive on hopes that the Reserve Bank of India (RBI) will cut key policy rates in its mid-quarter monetary policy review in order to boost growth. Markets across Asia, which were firm in morning trade, also boosted risk appetite among domestic investors. On the other hand, US markets were down around 0.50% in overnight on Cyprus’ plan to tax bank depositors in return for a bailout package from the European Union.
Back home, the Nifty opened 25 points higher at 5,860 and the Sensex resumed trade at 19,346, a gain of 53 points over its previous close. Buying support from realty, auto and banking stocks lifted the benchmarks to their intraday highs in initial trade itself. At the highs the Nifty went up to 5,864 and the Sensex rose to 19,379.
However, profit booking at higher levels led the market gradually lower in subsequent trade. Meanwhile, the RBI in its policy review announced a 25 basis point cut in the repo rate while keeping the cash credit ratio (CRR) unchanged at 4%. Almost at the same time, a news flash about the DMK withdrawing support to the UPA-led government at the Centre saw the market plunge into the negative.
The political developments led the market to its intraday low around 11.30am with the Nifty dropping to 5,724 and the Sensex tumbling to 18,939. But finance minister P Chidambaram’s assurance that the government was stable despite the DMK’s withdrawal of support helped the indices recover from their lows. The indices were range-bound in noon trade.
Meanwhile, faced with mounting criticism in Cyprus and a hostile reaction from the global markets, the Eurozone finance ministers have decided to ease the conditions of a bank levy for small savers, which was agreed last Saturday as part of a 10 billion euro ($13 billion) bailout for the debt-stricken nation.
The market continued to trade sideways till the end of the trading session wherein investors brushed aside the 25 bps repo rate cut by the central bank but were worried about the political instability arising today.
The market closed in the red on the back of the political developments at the Centre, which overshadowed the RBI’s rate cut. The Nifty settled 89 points (1.53%) down at 5,746 and the Sensex dropped 285 points (1.48%) but managed to end trade a tad above the 19,000-mark at 19,008.
Among the broader indices, the BSE Mid-cap index declined 1.37% and the BSE Small-cap index tanked 1.57%. 
The rout in the market saw all sectoral indices settling lower. The top losers were BSE Realty (down 3.63%); BSE Capital Goods (down 2.69%); BSE Metal (down 2.59%); BSE PSU (down 2.08%) and BSE Power (down 1.99%).
Six of the 30 stocks on the Sensex closed in the positive. The main gainers were GAIL India (up 1.96%); Bajaj Auto (up 1.17%); Sun Pharmaceutical Industries (up 0.74%); ITC (up 0.44%) and Maruti Suzuki (up 0.16%). The key losers were BHEL (down 5.05%); Bharti Airtel (down 4.74%); Sterlite Industries (down 4.15%); Jindal Steel & Power (down 3.96%) and Mahindra & Mahindra (down 3.45%).
The top two A Group gainers on the BSE were—Coromandel Industries (up 6.25%) and IPCA Laboratories (up 3.20%).
The top two A Group losers on the BSE were—Muthoot Finance (down 9.26%) and Lanco Infratech (down 6.96%).
The top two B Group gainers on the BSE were—Biopac India Corporation (up 20%) and Bharatiya Global Infomedia (up 19.84%).
The top two B Group losers on the BSE were—Bilcare (down 19.96%) and Manappuram Finance (down 19.94%).
Of the 50 stocks on the Nifty, seven ended in the green. The key gainers were GAIL India (up 2.65%); Bajaj Auto (up 1.59%); Ranbaxy Laboratories (up 1.37%); Lupin (up 0.94%) and Sun Pharma (up 0.67%). The main losers were BHEL (down 5.06%); Bharti Airtel (down 4.39%); DLF (down 4.09%); Reliance Infrastructure (down 3.91%) and Sesa Goa (down 3.77%).
Markets in Asia closed mostly higher as Monday’s sell-off saw investors picking up stocks at lower levels. Meanwhile, media reports indicated that the Cypriot parliament the levy on bank deposits, a condition for an EU bailout to the debt-ridden nation.
The Shanghai Composite advanced 0.78%; the Jakarta Composite gained 0.50%; the KLSE Composite advanced 0.35%; the Nikkei 225 jumped 2.03%; the Straits Times rose 0.47%; the Seoul Composite climbed 0.53% and the Taiwan Weighted settled 0.35% higher. Bucking the trend, the Hang Seng lost 0.19%.
At the time of writing, the CAC 40 of France was down 0.80%; the DAX of Germany fell 0.60% and UK’s FTSE 100 was trading 0.36% lower. At the same time, the US stock futures were marginally in the red.
Back home, foreign institutional investors were net buyers of equities totalling Rs506.01 crore on Monday whereas domestic institutional investors were net sellers of stocks amounting to Rs459.89 crore.
Pharmaceutical major Elder Pharmaceuticals today said it has inked a joint venture agreement with Japan's Kose Corporation to manufacture and sell cosmetics in India. Kose will hold 60% stake in the JV, which will be named Kose Elder (India) Pvt Ltd, while Elder will hold the balance 40% stake. The stock declined 1.41% to settle at Rs303.50 on the NSE.
Subex, a provider of business service systems for communication service providers, has been selected by Libyan telecom operator Almada, to provide it with its ROC revenue assurance and fraud management solutions. With this deal, the company has made its first foray into the country. Subex gained 1.29% to close at Rs11.75 on the NSE.
Asian Paints has entered the kitchen space by acquiring a majority stake in the Sleek Group that has a significant presence in the kitchenware segment. In a filing with the exchanges, the company said that its board has approved acquisition of 51% stake in the Sleek Group. Asian Paints declined 1.97% to settle at Rs4,904.10 on the NSE.


2G spectrum case: Delhi court summons Bharti Airtel chief Sunil Mittal, others

Besides Mittal and Ruia, the court issued summons against Asim Ghosh, who was the then managing director of accused firm Hutchison Max Telecom Pvt Ltd and former telecom secretary Shyamal Ghosh for 11th April

A Delhi court on Tuesday summoned as accused chairman-cum-managing director of Bharti Airtel Sunil Bharti Mittal, Essar Group promoter Ravi Ruia and five others in a case relating to alleged irregularities in allocation of additional spectrum to Airtel and Vodafone during the NDA regime.


Besides Mittal and Ruia, the court issued summons against Asim Ghosh, who was the then managing director of accused firm Hutchison Max Telecom Pvt Ltd and former telecom secretary Shyamal Ghosh for 11th April.


The CBI in its charge-sheet had only named Shyamal Ghosh and three telecom firms Bharti Airtel, Hutchison Max Telecom Pvt Ltd (now known as Vodafone India) and Sterling Cellular (now known as Vodafone Mobile Service), but Mittal, Ruia and Asim Ghosh were not arrayed as accused in the case by the agency.


Special CBI judge OP Saini issued summons against Mittal, Ruia, who was then a director in Sterling Cellular, and Asim Ghosh saying they were “prima facie in control of affairs of the respective companies”.


“I also find that at the relevant time, Sunil Bharti Mittal was chairman-cum-managing director of Bharti Cellular, Asim Ghosh was managing director of Hutchison Max Telecom Pvt Ltd and Ravi Ruia was a Director in Sterling Cellular, who used to chair the meetings of its board. In that capacity they were/are prima facie in control of affairs of the respective companies.


“As such they represent the directing mind and will of each company and their state of mind is the state of mind of the companies,” Special CBI judge OP Saini said.


“They are/were ‘alter-ego’ of their respective companies. In this fact/situation, the acts of the companies are to be attributed and imputed to them. Consequently, I find enough material on record to proceed against them also,” he said.


Ruia is also facing trial in a case arising out of the probe into the 2G spectrum allocation scam.


UN think tank opening office in Bahrain, with Bahraini government funding

The Gulf kingdom welcomes the International Peace Institute even as it bars some human rights advocates and journalists from the country

As Bahrain enters the third year of a crisis sparked by Arab Spring protests in 2011, the government continues to bar many human rights advocates and  journalists from entering the country.

But one non-profit group is not only being welcomed into the tiny Gulf kingdom, it’s opening an office there. And it’s doing so with funding from Bahrain’s ruling monarchy.

The International Peace Institute, a New York-based think tank closely associated with the United Nations (UN), announced  last month an agreement to open the office to “promote development, peace and international security.”

The announcement comes at a time when Bahrain’s image-conscious government is still under international scrutiny amid continued pro-democracy protests. Human rights groups have criticized the government’s at times violent crackdown on the protests and failure to follow through on promised reforms.

Institute President Terje Rød-Larsen, a veteran diplomat in the Mideast who is also a United Nations under-secretary-general, told ProPublica that the new office would be a positive force in Bahrain and the region.

He compared the think tank to United Nations programs that operate in or receive funding from countries that are in crisis or face criticism.

“Problems related to peace and security are in difficult countries,” Rød-Larsen said.

Bahrain appeals to the institute as a location for an office because “along many dimensions it’s an open society,” he said, citing the status of women and “freedom of religion.”

Rød-Larsen said that taking money from Bahrain’s government would not compromise the institute’s work. He declined to say how much money Bahrain is providing.

Rød-Larsen has been a frequent visitor to Bahrain in recent years, regularly meeting with government officials both in his capacity as the institute’s president and as a UN official.

With New York offices across from the United Nations, the institute counts many former U.N. officials among its staff and Secretary-General Ban Ki-moon is honorary chair of its board . Rød-Larsen has also traveled with a U.N. staffer on some of his trips to Bahrain, the U.N. news site Inner City Press has noted.

During his visits Rød-Larsen has repeatedly been cited in Bahrain’s state media praising the government, though he disputes the accounts .

“Larsen lauded [the] return of calm to Bahrain which indicates the kingdom’s success in overcoming the crisis,” the official Bahrain News Agency reported in April 2011, just two months after the protests began.

“The U.N. official lauded the climate of freedom, democracy and institutional development in Bahrain,” said another November 2011 report on a meeting between Rød-Larsen and the foreign minister.

Rød -Larsen said that media outlets often attribute inaccurate statements to him on his diplomatic travels.

“If I should dispute all stories like this, it would be full time work,” he said.

Rød-Larsen said that, in reality, he believes Bahrain’s government has made mistakes.

As for what the International Peace Institute’s new office in Bahrain will do when it opens, Rød-Larsen on a recent trip discussed “plans for a renewed national dialogue in Bahrain,” according to the institute.

Khalil Almarzooq, a spokesman for the main opposition group al-Wefaq, told ProPublica that the group had not heard from Rød-Larsen anytime recently. Almarzooq said whether the institute will be a positive force in Bahrain all depends on how it uses the money the government is providing.

Organized as a nonprofit charity in New York, the institute had a budget of nearly $11 million in 2011 and Rød-Larsen received about $495,000 in compensation.

According to the group’s 2011 annual report, its major donors that year included the United States, several governments in Europe, as well as Bahraini regional allies Qatar and the United Arab Emirates. The institute’s international advisory council includes Prince Turki Al-Faisal, the former head of Saudi intelligence. Saudi Arabia sent troops to help put down the protests in Bahrain in 2011.

Bahrain’s Ministry of Foreign Affairs did not respond to requests for comment.



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