Markets are likely to remain under pressure for the rest of the week
The market ended the day with a gain after trading in a narrow range. The BSE Sensex ended the day with a gain of 29 points (0.16%) at 17,970 and the Nifty ended the day 8.6 points higher (0.16%) at 5,374 points.
The market started the day with an early gain and gradually reached the intra-day high at mid-day trading. It pared gains as bank stocks slid on the concerns of a possible rate rise by the RBI in its next policy meeting. The psychological 18,000 mark was crossed today after which the market went south. In late afternoon trade, it rebounded from the low and ended the day with a gain.
Asian stocks rose as investors expected the US Federal Reserve to keep benchmark interest rates at a record low. The key benchmark indices in Hong Kong, Japan, Indonesia, Taiwan, South Korea and Singapore rose by 0.03% to 1.82%. However, China's Shanghai Composite index slipped 0.33%. The Bank of Japan has decided to keep interest rates unchanged as the economy is trying to inch back to stability.
The World Bank’s buoyant sentiment about the East Asian economy was reflected in its forecast for the economic growth for the region. In a semi-annual economic update, the Bank said that East Asia will grow by 8.7% in 2010. This is an upward revision from the 7.8% growth it had estimated in November last year.
US stocks were on the rise with bank stocks supporting the gain as the Fed meeting eased the concern on interest rates. The Dow Jones Industrial Average shed 3.56 points (0.03%), to 10,969.99. The S&P 500 gained 2 points (0.17%) to 1,189.44 and the Nasdaq rose 7.28 points (0.30%) to 2,436.81.
Closer home, rating agency CRISIL said that more Indian companies will be upgraded rather than downgraded in FY 2010-11. However, CRISIL said key risks that could affect credit quality include a global credit event on sovereign debt, impact of inflationary expectations on interest rates, and exchange rate volatility. The service industry grew at a slower rate in March after it touched a 17-month high in February. The HSBC Markit Business Activity Index, based on a survey of 400 firms, fell to 58.1 in March from 60.9 in February, which was its highest level since September 2008.
Foreign institutional buyers were net buyers on Tuesday of Rs261 crore, domestic institutional investors bought stocks worth Rs81 crore. The rupee was weaker today.
Godrej Consumer Products (up 1.3%) has acquired the Indonesian insecticides and personal care products company PT Megasari Makmur Group and its distribution company. Reliance Industries (up 0.7%) has said that it is currently producing 63-64 million standard cubic metres a day (mmscmd) of gas from the D6 block off India's east coast which is below the peak production capacity of 80 mmscmd.
GlaxoSmithKline Consumer Healthcare (up 0.46%) will invest Rs270 crore for the next three years in its Indian operations for capacity expansion. With a focus on the southern market, Electrotherm India (up 1.7%) plans to raise Rs80 crore from this region in the next two years. Reliance Power (down 0.6%) is likely to start selling power as soon as the commercial operation of the first unit of the Rosa Power Project in Uttar Pradesh starts. The second unit of the plant is expected to start in May 2010. NTPC (up 0.8%) plans to borrow Rs20,000 crore in FY11. Essar Oil plans to lay a 160-km pipeline from Durgapur to Kolkata to transport gas from its CBM blocks to consumers in West Bengal. Essar Oil (up 1.5%) has applied to the sectoral regulator, Petroleum and Natural Gas Regulatory Board (PNGRB) for permission to lay a pipeline from Durgapur, according to the company’s 13 January 2010 application to the regulator. The company is likely to start producing gas found below coal seams.