Sensex sheds 85 points, ends at 17,616

Indian markets ended lower due to weak global cues

The Sensex ended the day 85 points down from the previous day’s close, closing at 17,616, while the Nifty closed at 5,263, down 19 points, on the back of weak global markets.

Yesterday we had said that the bourses would be down and they remained depressed. The market may continue to be weak tomorrow. However, institutional buyers are waiting to buy on declines.

During the day, Reliance Industries Limited (RIL) rose 2% on reports of more fund-raising by the company through sale of treasury shares.

KRBL has given a purchase order to Suzlon Energy for the setting up of
an 8.1-MW wind turbine generating plant in Tamil Nadu. Both the stocks ended up in the red.

Thermax has received an order worth Rs240 crore from a leading business house for supplying four CEBC (Circulating Fluidised Bed Combustion) boilers, each of 190TPH capacity. The stock was down 1%.

Four Soft was up 5% on reports that Mondial Logistics had selected 4S eLog to automate the management of its warehouses throughout its locations in the Netherlands.

On Wednesday, finance secretary Ashok Chawla said that continuing stimulus measures were not good for the economy, arguing that “too much of stimulus can be injurious to health” and clearly hinting that a rollback of the these measures may be on the cards. However, Anand Sharma, commerce and industry minister, has reportedly urged against an immediate rollback of last year’s stimulus measures. He said that while exports were on the recovery path, a “full and sustained” recovery would happen only when demand picks up across the US, Europe and Japan.

In a move which could infuse more liquidity into the markets and make them more dynamic, the Securities and Exchange Board of India (SEBI) extended the tenure of contracts in securities lending and borrowing (SLB) to 12 months from one month. At the beginning, the tenure was for only seven days, which was later increased to 30 days.
During the day, Asia’s key benchmarks in China, South Korea, Japan, Singapore, Hong Kong, Taiwan and Indonesia fell by between 0.59%-1.9%.

As per Chinese reports, the People’s Bank of China sold 60 billion yuan ($8.78 billion) worth of three-month bills at 1.3684%, increasing the yield on such bills for the first time since August 2009, from 1.3280%.

China’s central bank said that it would pay close attention to the property market in 2010 while managing inflationary expectations.

Meanwhile, the Bank of England is likely to keep interest rates on hold at a record low of 0.5%, and maintain the quantitative easing programme at £200 billion of asset purchases.

On Wednesday, 6 January 2010, the Dow Jones Industrial Average and the S&P 500 were up 1.66 points and 0.62 points respectively, while the Nasdaq Composite was down 7.62 points. 

According to US media reports, the Federal Reserve released minutes from its last meeting which indicated that some members think more stimulus measures for the economy may be desirable. It also showed that they modestly raised their GDP growth forecast upward for 2010 and 2011. They see lower core inflation in the next few years.

As per reports, ADP Employment Services data showed that the private sector lost 84,000 jobs in December. That was fewer than the 145,000 jobs lost in November, but did exceed the 73,000 expected by economists. The December ISM service index improved to 50.1 from 48.7 registered in November.

In premarket trading, the Dow was trading 24 points lower.

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