Sideways movement still on: Tuesday Closing Report

As expected, Nifty almost hit 5,600 and collapsed

The Sensex and Nifty opened slightly above yesterday's closing levels at 18,565 and 5,556, respectively. The market could maintain an uptrend throughout the morning session, during which it hit its intra-day high-higher than that registered on Monday-at 18,689 and 5,593. We had suggested yesterday that 5,600 would be a barrier. Nifty almost hit 5,600 and collapsed.

The news of a ministerial panel meeting to consider raising fuel prices this week capped the upmove and the market started losing strength. The indices soon hit their intra-day lows at 18,429 and 5,515. However, news that the meeting might be deferred helped the market to make a minor recovery. It has been reported that the government is considering raising diesel prices by as much as Rs4 a litre, the steepest hike in about a decade. It is also looking at hiking domestic LPG prices.

The resumption of the upmove on the market helped the Sensex to recover 84 points from its intra-day low, to close at 18,513, still down by 17 points. The Nifty closed at 5,541, down by 10 points. Given the increased volatility today, the support for the Nifty now lies at 5,450, although when it gets there a new decline will resume. A close above 5,590 could result in a short rally till 5,730.

The advance-decline ratio on the National Stock Exchange was a negative 766:919. Foreign institutional investors have been net sellers over the past four days.

The broader markets closed mixed with the BSE Mid-cap index losing 0.04% and the BSE Small-cap index gaining 0.25%.

BSE Fast Moving Consumer Goods (up 1.20%), BSE Realty (up 1.12%) and BSE Power (up 0.48%) were the noteworthy gainers in the sectoral space. On the other hand, BSE Bankex (down 0.63%), BSE Consumer Durables (down 0.60%) and BSE Capital Goods (down 0.38%) were the top losers.

Hindustan Unilever (up 4.46%), NTPC (up 4.31%), Sterlite Industries (up 2.87%), Jaiprakash Associates (up 2%) and Reliance Communications (up 1.29%) were the top performers on the Sensex today. The laggards were led by HDFC Bank (down 1.47%), Hero Honda (down 1.26%), Mahindra & Mahindra (up 1.23%), Tata Power and Tata Steel (down 0.95% each).

The International Monetary Fund has again revised downwards India's growth outlook for 2011 to around 8%, on the back of high inflation and the overall global economic outlook that is clouded by rising commodity prices, especially oil. The multilateral agency had earlier also moderated the country growth projection to 8.2% from 8.4%.

The Asian Development Bank has already revised its growth projection for India to 8.2% for this calendar year from its earlier estimate of 8.7%, on account of high prices.

Markets in Asia, with the exception of Taiwan, settled in the green on media reports that Toyota Motor Corporation is likely to resume normal production as early as August, ahead of the earlier time-frame of November-December. Also, China recorded a trade surplus of $11.4 billion in April, beating expectations, as exports grew markedly faster than imports. Investors are now focused on Chinese inflation data that is expected on Wednesday.

The Shanghai Composite gained 0.60%, the Jakarta Composite rose 0.40%, the KLSE Composite advanced 0.26%, the Nikkei 225 climbed 0.25% and the Straits Times was up 0.64%. On the other hand, the Taiwan Weighted lost 0.14%. Markets in Hong Kong and South Korea were closed for a local holiday.

Back home, foreign institutional investors were net buyers of stocks worth Rs196.42 crore on Monday, whereas domestic institutional investors were net sellers of equities worth Rs125.78 crore.


Wheat output may touch 85 million tonnes in 2010-11

According to the agriculture ministry’s third advance estimates for foodgrain production in 2010-11, wheat output is estimated at 84.27 million tonnes and the total foodgrain production for 2010-11 is pegged at 235.88 million tonnes

New Delhi: Wheat production in the 2010-11 rabi season could touch 85 million tonnes, reports PTI quoting minister of state for agriculture Harish Rawat said.

“We are having a record wheat production this time and it may even touch 85 million tonnes in the current 2010-11 season,” Mr Rawat told reporters here.

According to the agriculture ministry’s third advance estimates for foodgrain production in 2010-11, wheat output is estimated at 84.27 million tonnes.

Mr Rawat was speaking on the sidelines of an all-India convention on agricultural administrative reforms.

Speaking on the importance of agriculture policy reforms, Mr Rawat said there is a need for greater co-ordination between the administrators and the farm scientists to meet the food requirement of a growing population.

“By 2025 our requirement of foodgrains will be around 280 million tonnes and this can only be achieved through better linkages between the agencies involved in agriculture,” he noted.

According to the agriculture ministry’s third advance estimates, foodgrain production for 2010-11 period is pegged at 235.88 million tonnes.

The convention was organised to discuss the possibility of creation of an all-India cadre of Indian agricultural service, restructuring of agriculture policy framework, creation of job opportunities for agriculture graduates and delivery system for agri-inputs and services.

It was organised by All India Federation of Agricultural Associations, Technical Officer’s Association of the ministry of agriculture and Bharatiya Kisan Union among other agricultural organisations.


Gokul Patnaik elected chairman of Indian Commodity Exchange

Gokul Patnaik is an independent and public interest director on the board of the Exchange

The Indian Commodity Exchange Board of Directors has elected Gokul Patnaik, IAS (Retd) as the non-executive chairman of the company.

Mr Patnaik is an independent and public interest director on the board of the Exchange and has served in senior positions both with the Government of Punjab and Government of India. Mr Patnaik has been the president of the All India Food Processors’ Association, a member of the National Council of Confederation of Indian Industries (CII) and a member of the task force on Agriculture of Federation of Indian Chambers of Commerce and Industry (FICCI).

He is on the Board of Trustees of the Prince of Wales’ Bhumi Vardaan Foundation which promotes sustainable agriculture in Punjab. He is also a member of the Chief Minister’s Advisory Committee on Agriculture, Government of Madhya Pradesh.

“It is indeed a privilege to have a person of Mr Patnaik’s eminence as the chairman of the Indian Commodity Exchange,” said Mr Rajnikant Patel, MD & CEO, Indian Commodity Exchange. “Mr Patnaik brings with him a wealth of experience and insight into this role in the commodity exchange space, particularly agriculture. His role as an administrator, where he has been actively involved in policy formation and execution, will definitely help the Exchange in delivering value to the national commodity market infrastructure. His guidance and expertise will be an asset for the organisation and beneficial in more ways than one.”


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