Share prices to open in the green in India: Friday Market Preview

The decision of the G7 leaders to intervene in the currency markets to curb the yen’s rise supported markets worldwide

The local market is likely to open in the green as Japan stepped up efforts to restore power at a damaged nuclear power plant. The development boosted markets in Asia, which were trading in the positive zone in early trade on Friday. Overnight Wall Street closed with decent gains on easing of worries in Japan and a fall in initial jobless claims. The SGX Nifty was 13 points higher at 5,492 compared to its previous close of 5,479.

The market opened lower on Thursday, tracking the Asian markets that were trading in the red on concerns over developments in Japan and West Asia, and their impact on the global recovery. During the day, the Sensex hit a high of 18,354 and the Nifty went up to 5,510 before the announcement of the credit policy. But after the credit policy announcement the Sensex went down to hit a low of 18,104 and the Nifty was down to 5,435. Eventually, the Sensex closed at 18,150, down 209 points and the Nifty closed at 5447, a loss of 65 points.

Markets in the US closed higher on Thursday, breaking the three-day declining streak after the Group of Seven (G7) leaders suggested intervention in the currency market to curb the strengthening yen. Japan’s efforts to restore power supply to a damaged nuclear power plant supported investor sentiment.

In economic news, the Labor Department said on Thursday its Consumer Price Index rose 0.5% last month, the largest gain since June 2009, after increasing 0.4% in January. Core CPI—excluding food and energy—rose 0.2% after a similar rise in January. On the other hand, initial claims for unemployment benefits fell 16,000 to a seasonally adjusted 385,000 last week, in line with expectations, hinting at a strengthening in the labor market.

The Dow gained 161.21 points (1.39%) at 11,774.51. The S&P 500 rose 16.81 points (1.34%) at 1,273.69 and the Nasdaq added 19.23 points (0.73%) to close at 2,636.05.

Markets in Asia were in the positive terrain in early trade on Friday after G7 leaders agreed to intervene in the currency market to curb the rise in the yen even as Japan stepped up efforts to restore power at a damaged nuclear power plant, easing fears of radiation. The positive outlook in Japan also supported gains in other markets across the region.

The Shanghai Composite was up 0.63%, the Hang Seng gained 0.40%, the Jakarta Composite rose 0.64%, the KLSE Composite added 0.15%, the Nikkei 225 surged 1.77%, the Straits Times rose 0.18%, the Seoul Composite surged 0.87% and the Taiwan weighted advanced 1.08% in early trade.

However, developments in Libya and the Middle East remains a cause for concern as crude prices rose once again. The United Nations Security Council on Thursday voted to foil Libyan leader Muammar Qaddafi’s air force and to grant military authority to the US and its allies to protect civilians in the trouble nation.

US crude for April delivery on the Nymex settled up $3.44, or 3.51%, at $101.42 a barrel on Thursday, after rallying to $101.99. It was also the biggest one-day percentage gain. Brent crude for May delivery advanced $4.30, or 3.9%, to $114.90.

Back home, the Union Cabinet has approved the tabling of a revised Pension Fund Regulatory and Development Authority (PFRDA) Bill in the current session of Parliament. It has also decided to push for the passage of the State Bank of India (Subsidiary Banks Laws) Amendment Bill, 2009 in this session, which is to end on 25th March.

The PFRDA Bill seeks to grant statutory status to the pension sector regulator, while the SBI (Subsidiary Banks Laws) Bill would enable the five associate banks of SBI to raise their capital by issuing equity shares through the public or preferential allotment/private placement.


Share prices still in an undecided zone: Thursday Closing Report

The situation of one day up and the next day down is continuing. A big move (either up or down) is on its way

The market opened lower, tracking the Asian markets that were trading in the red on concerns over developments in Japan and West Asia, and their impact on the global recovery. Nervousness ahead of the Reserve Bank of India's (RBI) mid-quarter policy review also weighed on investors.

The indices made an attempt to push into the green in mid-morning trade, but the RBI's 25 basis point hike in key rates put pressure on the market, pushing it further southwards. Even the marginal fall in weekly food inflation numbers for the first week of March, which came out at around noon, was ignored by investors. The benchmarks slipped to their day's lows in the last half an hour and closed a little above those levels.

The market opened with a downward gap following sharp losses in the US yesterday and Asian markets today. During the day, the Sensex hit a high of 18,354 and the Nifty went up to 5,510 before the announcement of the credit policy. But after the credit policy announcement the Sensex went down to hit a low of 18,104 and the Nifty was down to 5,435. Eventually, the Sensex closed at 18,150, down 209 points and the Nifty closed at 5447, a loss of 65 points. The advance-decline ratio on the National Stock Exchange was 607:1050.

The market breadth on the key indices was negative. The Sensex had 22 losers and eight gainers at the end of the session. The 50-share Nifty closed with 35 stocks in the red and 15 in the green. Among the broader indices, the BSE Mid-cap index declined 0.29% and the BSE Small-cap index fell by 0.38%.

In the sectoral space, BSE Power (up 0.22%) and BSE Consumer Durables (up 0.08%) were the only two gainers. BSE Fast Moving Consumer Goods (down 1.54%), BSE IT (down 1.50%), BSE Auto (down 1.27%), BSE Metal (down 1.18%) and BSE TECk (down 1.15%) were the top losers.

The top Sensex gainers were Reliance Communications (up 3.50%), BHEL (up 1.98%), Reliance Infrastructure (up 1.16%), Cipla (up 0.98%) and Jaiprakash Associates (up 0.79%). Maruti Suzuki (down 4.44%), HDFC (down 3.68%), Hindalco Industries (down 2.49%), DLF (down 2.12%) and Infosys Technologies (down 1.79%) were the laggards on the index.

Home and auto loans may cost more as the RBI raised its short-term lending and borrowing rates by 25 basis points each, yet again today, with a view to check spiralling prices of essential commodities.

The short-term lending (repo) rate has been hiked to 6.75% and the short-term borrowing (reverse repo) rate to 5.75% with immediate effect. However, the central bank kept the cash reserve ratio (CRR) unchanged at 6%.

This is the eighth time since March 2010 that the RBI has resorted to a policy rate hike to tackle inflation, which is ruling above 8%, still above the comfort level of 5%-6%. Besides, the RBI has upped its March-end inflation forecast to 8% from 7% projected earlier.

In another development, food inflation fell to a three-and-a-half-month low of 9.42% for the week ended 5th March, from 9.52% in the previous week. The drop in food inflation, which is still above the comfort zone, is viewed as a breather for the government grappling with high price rise of essential commodities.

Markets in Asia settled in negative terrain, but recovered from the day's lows even as concerns over the nuclear situation in Japan continued. Shares of Tokyo Electric Power-traded for the first time since the earthquake-finished down 13%. The Nikkei 225, which had slipped 4% in early trade, pulled back to close 1.4% down.

The Shanghai Composite declined 1.14%, the Hang Seng fell 1.83%, the Jakarta Composite lost 1.34%, the KLSE Composite shed 0.02%, the Nikkei 225 declined 1.44%, the Straits Times slipped 0.69% and the Taiwan Weighted was 0.50% down. On the other hand, shipbuilding orders boosted the Seoul Composite as it ended 0.05% higher today.

Back home, foreign institutional investors were net sellers of stocks worth Rs134.52 crore on Wednesday. Domestic institutional investors were net buyers of equities worth Rs326.72 crore.

Gilead Sciences, a California based bio-pharmaceutical research firm along with its patent partner Roche Holding AG has sued Indian generic drug maker Natco Pharma (up 0.14%) for allegedly infringing a US patent for Tamiflu, which is used in the treatment of bird and swine-flu. Gilead has requested a federal court in Wilmington, Delaware, to block generic versions of Tamiflu until its patent expires in 2017.

In February, Natco filed an Abbreviated New Drug Application with USFDA under Para-IV with USFDA and alleged that Gilead's patent on the drug is invalid and sent a notice to Gilead to that effect.

Indian alumina and aluminium producer, Nalco (down 3.39%), has cut aluminium prices in the domestic market by Rs2,500 ($55.2) per tonne. The aluminium major has reduced the price to match with the falling LME (London Metal Exchange) prices.

The basic price of standard aluminium ingots and that of standard aluminium sow ingots has been cut to Rs1,40,200 a tonne and to Rs1,40,150 per tonne respectively. The new prices for all aluminium products, which came into effect from Wednesday, will remain valid till 31st March.

Ramky Infrastructure (down 0.45%) has secured new orders totalling Rs288.32 crore across water and waste water and building verticals. The first order, valued at Rs93.86 crore, is from the Bijapur city municipal council for rehabilitation of existing sewerage system and interception and extension of sewerage system to new areas (district 1A) and rehabilitation of primary storm water drain and for improvements of sewerage system in the city limits. The second order, valued at Rs 97.17 crore, is bagged from Lodha Developers, for civil construction works for its 'Casa Rio' housing project at Dombivali.



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Share prices rise, absorbing the negatives: Wednesday Closing Report

The Sensex and Nifty are on a steady uptrend. Would they surprise us on the upside?

The recovery in the Asian stock markets boosted investor sentiments in India, leading to a higher opening today. A surge in the advance tax payments for the fourth quarter also aided the gains. Oil & gas and metal counters witnessed good demand in morning trade with the boarder markets also joining the rally.

The indices touched their day's highs in post-noon trade. But news of the suicide of former telecom minister A Raja's aide Sadiq Batcha pressurised the market a bit in the last half an hour with the benchmarks paring some of the gains, but making a close in the green.

The Sensex and Nifty, after opening with a positive gap at 18,264 and 5,476, were able to maintain an uptrend. Overall, the good performance of the Asian indices helped the Indian market, as well. The day's opening was the intra-day low, too. Each dip and rise during the day was at a higher level.

Ultimately in the post-noon session, the market hit its intra-day high after which it fell. The intra-day highs were 18,444 and 5,535, respectively. The Sensex closed 191 points up at 18,359 while Nifty was up 62 points up at 5,511. The advance-decline ratio on the National Stock Exchange was positive at 1141:554. The market is slowly turning up, ignoring the negatives.

The gainers outnumbered the losers on the key benchmarks, as the Sensex closed with 24 advancing stocks and six declining stocks whereas the Nifty retired with 42 stocks in the green, six in the red while two stocks remained unchanged. Among the broader markets, the BSE Mid-cap index gained 1.37% and the BSE Small-cap index advanced 1.216%.

All sectoral indices closed in the positive zone. The BSE Realty index (up 2.47%) was the top gainer. It was followed by BSE Bankex (up 2.15%), BSE Consumer Durables (up 1.90%), BSE Public Sector Undertaking (up 1.47%) and BSE Healthcare (up 1.41%).

Reliance Infrastructure (up 5.17%), State Bank of India (3.10%), ICICI Bank (up 3.03%), DLF (up 2.44%) and TCS (up 2.36%) were the top gainers on the Sensex. On the other hand, Hindustan Unilever (down 1.15%), Hindalco Industries (down 0.56%) and Cipla (down 0.52%) were the top losers.

The Nikkei 225 that lost over 11% yesterday, its biggest one-day fall since October 2008, recouped nearly half those losses today. The gains also helped other markets in the region to close on a positive note as investors resorted to bargain-hunting after the three-day decline. Global investment firm Goldman Sachs Group opined that the effects of 11th March earthquake and tsunami on the Japanese economy would be temporary.

The Shanghai Composite gained 1.20%, the Hang Seng added 0.10%, the Jakarta Composite rose 0.20%, the KLSE Composite advanced 0.56%, the Nikkei 225 jumped 5.68%, the Straits Times was up 0.85%, the Seoul Composite surged 1.77% and the Taiwan Weighted was 1.09% higher in trade today.

Back home, institutional investors-both foreign as well as domestic-were net buyers of stocks yesterday. While foreign institutional investors pumped in Rs148.28 crore, domestic institutional investors pooled in Rs567.10 crore.

GEI Industrial Systems (up 2.27%) has secured orders collectively worth Rs 45 crore from leading Indian companies in the cement and steel sector. It has bagged an order from UltraTech Cement for supplying of air cooled vacuum steam condensers for the latter's captive power plants being set up in Andhra Pradesh.

GEI has also secured two orders from Top Worth Group companies-Top Worth Urja and Metal and Crest Steel and Power-for supply to captive power plants being set up at Nagpur in Maharashtra and Durg in Chhattisgarh, respectively.

Brahmaputra Infraproject (down 2.55%) has bagged an order worth Rs184 crore from Reliance Utility Engineers. The contract is for six-laning of the Pune-Satara Road (NH-4), Package 2B.

Kirloskar Pneumatic Company (up 3.09%) has inked an agreement with Northern Railway for haulage of RoadRailer trains, including a pilot project between Delhi and Chennai. The agreement is a continuation of the memorandum of understanding signed by the company with the Indian Railways in January 2008.

RoadRailer is a bi-modal transport system, which facilitate transport of white goods from one destination to other by road as well as rail using the same vehicle. For this purpose, the company already obtained and developed necessary technology from US-based company for manufacturing RoadRailer.


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