Sensex, Nifty may be headed up: Thursday Closing Report

The Nifty has to close above the level of 5,380 for the uptrend to continue further

The indices treaded water till noon trade but received a boost in the second half on positive cues from Europe, settling in the green for the fourth day in a row. Yesterday we had mentioned that the Nifty may move sideways with an upward bias and for the uptrend to continue, the index has to hold itself above today’s low of 5,293. The benchmark moved in a narrow range of 51 points and ended in the positive. It almost reached the level of 5,293 and stayed in the green for the major part of the session. The benchmark has to close above the level of 5,380 for the uptrend to gain some more momentum. However, the day’s low continues to be the support. The National Stock Exchange (NSE) saw a lower volume of 57.95 crore shares.

The market opened sideways with a positive bias following a cautious opening by the Asian back on renewed European concerns. Besides, lower-than-expected earnings from IBM and Intel saw the US markets settling lower overnight. The Nifty opened 21 points up at 5,321 and the Sensex added 41 points to its previous close to resume trade at 17,433.

The indices were seen fluctuating on both sided of their previous close and touched their intraday lows around 10.30am. At the lows, the Nifty slipped to 5,291 and the Sensex fell to 17,362.

Bargain hunting at the lows pushed the benchmarks into the green a short while later. The market was listless in the post-noon session, paring some of the gains amid volatility in the post noon session. However, positive European indices saw the benchmarks hitting their day’s high towards the end of the session. At the highs, the Nifty climbed to 5,342 and the Sensex rose to 17,530.

The market settled marginally off the highs. The Nifty closed 32 points up at 5,332 and the Sensex finished 111 points higher at 17,504.

The advance-decline ratio on the NSE was almost balanced at 723:704.

Among the broader markets, the BSE Mid-cap index rose 0.27% and the BSE Small-cap index settled 0.27% up.

BSE Auto (up 2.05%) led the sectoral gainers. It was followed by BSE Healthcare (up 1.18%); BSE Fast Moving Consumer Goods (up 0.96%); BSE Metal (up 0.80%) and BSE IT (up 0.74%). The top losers were BSE Capital Goods (down 0.89%); BSE Power (down 0.78%); BSE Oil & Gas (down 0.59%); BSE Consumer Durables (down 0.48%) and BSE Realty (down 0.32%).

The top performers on the Sensex were Coal India (up 3.85%); HDFC Bank (up 3.22%); Tata Motors (up 3.15%); Maruti Suzuki (up 2.92%) and Hero MotoCorp (up 2.42%). The key losers were BHEL (down 3.66%); Hindalco Industries (down 1.91%); GAIL India (down 1.77%); Wipro (down 1.35%) and Reliance Industries (down 1.01%).

The Nifty leaders were Coal India (up 4.11%); Maruti Suzuki (up 3.49%); Kotak Mahindra Bank (up 3.46%); Tata Motors (up 3.08%) and HDFC Bank (up 2.91%). The major losers were ACC (down 3.79%); BHEL (down 3.76%); Jaiprakash Associates (down 2.25%); Reliance Infrastructure (down 2.20%) and Hindalco Ind (down 2.03%).

Markets in Asia settled mixed ahead of a Spanish government bond auction. Meanwhile, an official form the People’s Bank of China said that the central bank will take necessary steps to infuse liquidity in a bid to boost economic growth. Japanese exports rose 5.9% in March on an annual basis while imports jumped 10.5% in 12 months to march, pushing the trade back to deficit.

The Shanghai Composite shed 0.09%; the Jakarta Composite fell by 0.06%; the KLSE Composite declined 0.14%; the Nikkei 225 dropped 0.82% and the Seoul Composite lost 0.23%. On the other hand, the Hang Seng surged 1.03%; the Straits Times gained 0.25% and the Taiwan Weighted rose 0.23%. At the time of writing, the key European markets were up between 0.77% and 0.86% and the US stocks futures were in the positive.

Back home, foreign institutional investors were net buyers of shares totalling Rs221.63 crore on Wednesday and domestic institutional investors pumped in Rs37.88 crore into equities.

After a delay of more than six months, the government today gave approval to Cairn India to raise output from the Mangala oilfield, its largest oilfield in Rajasthan block by 25,000 barrels per day (bpd) to 150,000 bpd. Together with over 25,000 bpd of output from Bhagyam, the second largest of the 25 oil and gas finds in the Rajasthan block, the Thar dessert block currently produces over 150,000 bpd and in the next few days production would rise to at least 175,000 bpd. Cairn India added 0.04% to settle at Rs350.15 on the NSE.

Pharma major Strides Arcolab’s US arm, Onco Therapies, has received approval from the US health regulator to sell generic version of Cisplatin injection used in cancer treatment in the American market. A chemotherapy drug, Cisplatin is used to treat various types of cancers, including lung cancer and ovarian cancer. Strides closed at Rs654.90 on the NSE, a jump of 3.66% over its previous close.

Tata Communications (TCL) has pulled out of the acquisition bid for Cable & Wireless Worldwide (CWW) as it has failed to reach an agreement on offer price with the British firm. With TCL moving out, UK-based telecom giant Vodafone is the only contender for the bid. TCL rose 0.51% on the NSE to settle at Rs236.10 today.


ICICI Bank cuts lending, deposit rates by 0.25%

Chanda Kochar says she expect the cost of funds to gradually come down and this reduction in the lending rates is a proactive move by the bank

Mumbai: India's largest private sector lender ICICI Bank became the first major bank to cut its lending and deposit rates by 0.25% following the Reserve Bank cutting interest rates by 0.50% two days ago, reports PTI.

Accordingly, the bank's base rate or the minimum rate of lending, stands reduced by 25 basis points to 9.75%, while the prime lending rates also saw a similar reduction to 18.50%.

“With the easing of systemic liquidity, we have already seen some correction in wholesale deposit rates. We expect the cost of funds to gradually come down and this reduction in the lending rates is a proactive move by us to pass on the benefit to our valued customers,” managing director and chief executive Chanda Kochhar said in a statement explaining the reason for the reductions.

The revised base rate is applicable from 23 April 2012, the bank said.

The move comes a day after state-run mid-run bank IDBI Bank announced a 0.25% cut in lending rates while a slew of other banks, including HDFC Bank, have also hinted at similar moves since the RBI announcement.

ICICI Bank has cut rates on loans under the older BPLR (benchmark prime lending rate) regime by 0.25% to 18.50%, and for consumer loans.  It has also cut its floating reference rate (FRR) by a similar amount to 15.50% which will benefit home loan borrowers.

The move by ICICI Bank comes within two days of RBI cutting its key lending rate by a surprising 0.50% to 8% with a view to boost sagging growth.


Public Interest Exclusive
Flat owners urge Maharashtra government to retain MOFA

Ramesh S Prabhu, chairman of the Maharashtra Societies Welfare Association said, “MOFA has been in force for almost 60 years. It is more consumer-friendly. The new Bill has many shortcomings”

The Maharashtra government’s new Maharashtra Housing (Regulation & Development) Bill, 2011, is facing strong criticism from activists and flat owners. Activists and citizens are demanding that the government shelve the new Bill and strengthen Maharashtra Ownership of Flats Act (MOFA) instead, and a public hearing be organised on the issue.

Members of Maharashtra Societies Welfare Association have protested against the hushed manner in which the government has pushed the legislation and want a public discussion to be held. Ramesh S Prabhu, chairman of the association, said, “We have written repeatedly to the chief minister and the minister of housing, but no public hearing was held on the matter. How can they pass a legislation which is going to affect the people adversely without consulting the flat owners?”

The association is planning to send a delegation to the government to retain the MOFA and scrap the new Bill. In collaboration of several NGOs, the Maharashtra Societies Welfare Association organised a public meeting-cum-awareness workshop on the proposed Bill on Thursday. Mr Prabhu, chairman, Maharashtra Societies Welfare Association, said, “There is an urgent need to strengthen the MOFA further. There are many high court and Supreme Court judgments interpreting several provisions of the MOFA. This Act is well settled.”

Mr Prabhu said that it will be more helpful for the consumers if the provisions related to regulatory authority or Appellate Tribunal is incorporated in the MOFA itself, instead of the Act being replaced by a new legislation which is evidently pro-builder. He said, “MOFA has been in force for almost 60 years. It is more consumer-friendly. The new Bill has many shortcomings. We have received many proposals as to how to make the housing sector more transparent.”

He pointed out some of the grey areas in the new Bill. “Builders may just register multiple projects under separate aliases online after registration. The documents that are required for registration have to be self-attested by the builder; and registration will be done before getting them validated by any other authority,” Mr Prabhu said.

He also pointed out that in case of default, the developer will be subject to a light monetary penalty. “At the most, if the delivery is delayed, the builder will refund the money to the customer. If I am spending Rs60lakh-Rs70laks to buy a flat, I would want the flat and not the money,” he added.

Veteran property lawyer Vinod Sampat said, “The government can now rechristen the “minister of housing” as “minister for builders”. With the Maharashtra Housing (Regulation and Development) Bill, the government is going out of its way to be friendly with the builders.”

Mr Sampat also said that the housing minister’s claim that the earlier law doesn’t have any option of taking criminal action against builder is false. “I myself have fought many cases. If he says earlier there was no option of penalty, it is a false statement,” said Mr Sampat.


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