Sensex, Nifty may recover subject to dips: Monday Closing Report

Nifty may continue to be in positive if the day’s low hold

A slew of positive domestic news helped the market stage a smart recovery and snap its three-day decline. In the first hour of trade, the Nifty touched the low of 4,770, near the lows last seen on 10 January 2012. The index made a lower high and managed to close in the positive at 4,848. If the index manages to hold itself above today’s low we may the see it going up to the level of 4,910. Else we may see the benchmark falling to the level of 4,730. The National Stock Exchange (NSE) saw a volume of 50.61 crore shares.

The domestic market opened lower on unsupportive cues from its Asian peers, which were in the negative in morning trade on concerns about the slowdown in the global economy. The Nifty opened 45 points down at 4,797 and the Sensex resumed trade at 15,809, a loss of 156 points over its previous close.

Across-the-board selling pushed the indices to their intraday lows in first half hour itself. At the lows, the Nifty fell to 4,770 and the Sensex drifted back to 15,749. The benchmarks managed to recover from their lows as select buying supported the upmove.

Meanwhile, the rupee gained 19 paise to 55.35 against the dollar in mid-morning trade today, after opening lower at 5.58. Traders attributed the rupee’s gains to selling of the US greenback by banks and corporates.

The market hit its intraday high around 11.00am with the Nifty rising to 4,808 and the Sensex up at 15,868. However, the opening of the key European indices in the red capped the gains in the local market, which continued to trade sideways in the negative.

Positive signals helped the indices move higher in the post-noon session. The civil aviation ministry has reportedly posted a discussion paper on its website, has sought opinion from all stakeholders for a proposal to reduce state taxes on jet fuel to 4%. This apart, IMD sources said that conditions are favourable for the onset of the South West monsoon over Kerala in the next 48 hours. Also, the Reserve Bank of India (RBI) today hinted at a cut in interest rates, saying moderation in inflation due to lower economic growth and cooling global oil prices provide room for easing monetary policy.

The recovery which began in the noon session continued till the end of trade, taking the benchmarks into the positive towards the close of trade. Hitting the day’s high, the Nifty went up to 4,858 and the Sensex regained the 16,000 mark to touch 16,013.

The indices pared a small part of their gains, but managed to close in the green after three continuous days of declines. The Nifty closed seven points higher at 4,848 and the Sensex gained 23 points to settle at 15,988.

The advance-decline ratio on the NSE was 704:976.

The broader markets underperformed the Sensex today, as the BSE Mid-cap index fell by 0.21% and the BSE Small-cap index slipped by 0.23%.

The BSE Capital Goods index (up 2.08%) was the top sectoral gainer today. It was followed by BSE Realty (up 1.35%); BSE Oil & Gas (up 1.17%); BSE Bankex (up 1.10%) and BSE Auto (up 0.78%). The losers were led by BSE Consumer Durables (down 2.92%); BSE Fast Moving Consumer Goods (down 1.53%); BSE Metal (down 0.605); BSE Healthcare (down 0.54%) and TECk (down 0.51%).

The Sensex toppers were Larsen & Toubro (up 3.43%); ONGC (up 3.19%); DLF (up 1.97%); Tata Motors (up 1.89%) and Reliance Industries (up 1.31%). The main losers were GAIL India (down 3.47%); Jindal Steel (down 2.72%); Tata Power (down 2.49%); Bharti Airtel (down 2.31%) and Sterlite Industries (down 2.30%).

The key performers on the Nifty were Jaiprakash Associates (up 5.59%); Siemens (up 4.60%); Bank of Baroda (up 3.77%); L&T (up 3.51%) and BPCL (up 3.41%). GAIL (down 3.07%); Jindal Steel (down 2.92%); Tata Power (down 2.85%); Sesa Goa (down 2.45%) and Asian Paints (down 2.38%) settled at the bottom of the index.

Markets across Asia closed lower on worries about the pace of global growth following a weak US jobs report and lower-than-expected manufacturing output from China. The impasse in Europe also added to the weakness.

The Shanghai Composite tumbled 2.73%; the Hang Seng tanked 2.01%; the Jakarta Composite sank 3.82%; the KLSE Composite declined 1.17%; the Nikkei 225 dropped 1.71%; the Straits Times declined 1.70%; the KOPSI Composite saw a cut of 2.80% and the Taiwan Weighted settled 2.98% lower.

At the time of writing, CAC 40, the French benchmark was in the green while the German DAX was in the negative. Markets in Britain were closed for a local holiday. The US stock futures were mostly in the positive.

Back home, foreign institutional investors were net sellers of shares totalling Rs220.38 crore while domestic institutional investors were net buyers of equities amounting to Rs205.50 crore.

Realty firm Omaxe has reduced its gross debt by Rs213 crore in the last fiscal to Rs1,339.55 crore from internal accruals. The debt-equity ratio has been brought down to 0.76 in 2011-12 fiscal from 0.93 in the previous financial year, the company said. The stock added 0.07% to close at Rs145.10 on the NSE.

Pipe-maker Man Industries (India) today said it has bagged orders worth Rs800 crore from the Middle East and domestic customers for supply of large diameter pipes for oil and gas sector. With these new orders, the outstanding order book of the company stands at nearly Rs1,800 crore. The stock settled at Rs96 on the NSE, down 0.88% from its previous close.

Consumer durables finance company, Bajaj Finserv Lending, has launched its “Extended Warranty” plan with zero per cent interest consumer durables finance. Under the extended warranty scheme, the company will provide protection of the cost towards repair and replacement arising out of unexpected defects after the manufacturer’s product warranty expires. Bajaj Finserv lost 2.81% to close at Rs635.50 on the NSE.


Public Interest Exclusive
Monsoon round the corner, no need for gloom says IMD

Parts of Kerala have been receiving rains since this morning. Weather watchers attribute the slight delay in the onset of monsoon to Typhoon Mawar which was active in a western Pacific Ocean off the Philippines

South-west monsoon, the key to the agriculture driven trillion-dollar Indian economy, is on course and is expected to drench Kerala by Wednesday thereby bringing much-needed relief to farmers, reports PTI.

“Monsoon is round the corner. Parts of Kerala have been receiving rains since this morning. We may declare the onset of monsoon over Kerala coast by Wednesday,” Laxman Singh Rathore, Director General, India Meteorological Department (IMD) told PTI.

Kerala usually receives monsoon showers by 1st June, but Mr Rathore said there was no need to paint a gloomy picture as the progress of the seasonal rainfall phenomenon was well with the forecast limits which have a model error of four days.

A unique feature of this year’s monsoon would be steady progress along the western coast bring copious rains to coastal Kerala and leaving the peninsular region relatively dry.

Current observations show central and northern Kerala receiving rainfall while Thiruvananthapuram getting little rains.

Weather watchers attribute the slight delay in the onset of monsoon to Typhoon Mawar which was active in a western Pacific Ocean off the Philippines and sucking away moisture and wind currents to power itself.

“The typhoon has moved northward towards Japan and will no longer affect the progress of the monsoon,” Mr Rathore said.

On the effect of El Nino conditions—warming of the Central Pacific—on the monsoon, he said it was too early to predict any adverse effect.

“At present, El Nino conditions are neutral,” he said indicating that it would not have much impact on the monsoon.

El Nino conditions could turn positive during August-September when the monsoon season draws to a close in India.

Scientists said sea surface temperatures in the central Pacific were expected to rise by 0.5 degrees Celsius to 0.7 degree Celsius.

However, they were quick to point out that there was no direct co-relation between El Nino and the monsoon.

“In 1997, El Nino was at its highest with central Pacific sea temperatures rising by four degrees but India had a normal monsoon,” Mr Rathore said.

In 1997, the sea surface temperatures in the Indian Ocean were favourable for the monsoon which negated the adverse impact of El Nino.

The IMD declares the onset of monsoon over Kerala when 50% of the 14 observation stations in the state and Lakshadweep islands report rainfall for 48 hours.

Monsoon rains are crucial for agriculture as only 40% of the cultivable area is under irrigation. The farm sector contributes about only 15% to the country’s Gross Domestic Product (GDP), but it employs about 60% of India's population.

Mr Rathore said deviation of 3-4 days in arrival of monsoon rains would have no adverse impact on sowing of kharif crops.

“There is no concern for paddy sowing because seedlings are raised first in nursery through irrigation and then transplanted in the field much later,” he said.

There would be no impact on cotton and sugarcane crops as these long-duration crops are mostly cultivated in areas with irrigation facilities.

On the back of good monsoon in 2010 and 2011, the country harvested a record foodgrains production of 245 million tonnes and 252.56 million tonnes, respectively.


Life Exclusive
Medical problems? Statistics may help you to predict future ailments

The model shares information across patients who have similar health problems which leads to better predictions

Statistical researchers from the University of Washington, after analyzing medical records from thousand of patients, have developed a statistical model for predicting what other medical problems that a patient might encounter. This predictive algorithm has been used in a medical setting for the first time. It is based on social media algorithms like say Facebook which suggests ‘friend’ or Amazon which suggests ‘products’ based on the person’s interaction with these platforms. 

How does it work? For instance, if a patient has already had dyspepsia and epigastric pain, there are good chances that he might suffer from heartburn. Tyler McCormick, an assistant professor of statistics and sociology at the University of Washington, says that, “This provides physicians with insights on what might be coming next for a patient, based on experiences of other patients. It also gives a predication that is interpretable by patients.”

The algorithm will be published in the upcoming issue of the Journal Annals of Applied Statistics. It will be co-authored by Cynthia Rudin of Massachusetts Institute of Technology, and David Madigan of Columbia University.

Explaining the difference of his model from others, Mr McCormick said that “it shares information across patients who have similar health problems. This allows for better predictions when details of a patient’s medical history are sparse.”

Many a times, new patients might not have detailed records such as files listing ailments and drug prescriptions from the previous doctor. Here “the algorithm”, Mr McCormick explains, “can compare the patient’s current health complaints with other patients who have a more extensive medical record that includes similar symptoms and the timing of when they arise. Then the algorithm can point to what medical conditions might come next for the new patient. We’re looking at each sequence of symptoms to try to predict the rest of the sequence for a different patient.”

Interestingly, the algorithm will also be helpful in situations where it is statistically difficult to predict a less common condition. “For instance, most patients do not experience strokes, and accordingly most models could not predict one because they only factor in an individual patient’s medical history with a stroke. But McCormick's model mines medical histories of patients who went on to have a stroke and uses that analysis to make a stroke prediction,” says the press release.

The statisticians used medical records obtained from a multi-year clinical drug trial involving tens of thousands of patients aged 40 and older. The records also included demographic details, such as gender and ethnicity, as well histories of medical complaints and prescription medications of the patient.

According to the press release, it was found that of the 1,800 medical conditions in the dataset, most of them—1,400— occurred fewer than 10 times. McCormick and his co-authors had to come up with a statistical way to not overlook those 1,400 conditions, while alerting patients who might actually experience those rarer conditions. They came up with a statistical modelling technique that is grounded in Bayesian methods, the backbone of many predictive algorithms. McCormick and his co-authors call their approach the Hierarchical Association Rule Model and are working toward making it available to patients and doctors.

"We hope that this model will provide a more patient-centred approach to medical care and to improve patient experiences," Mr McCormick said.


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