The key benchmark indices slipped into the red on profit taking
after a sharp surge at the onset of the trading session. The BSE
30-share Sensex was down 294.38 points or 2.06%, off close to 775
points from the day's high and up close to 150 points from the
day's low. Banking and IT stocks fell.
The wild swings in early trade followed a historic rally on Monday,
18 May 2009, when the key indices viz. the BSE Sensex and the S&P
CNX Nifty surged more than 17% each on hopes a new stable
government will be able to push reforms. Strong global cues may
further aid the rally.
A clear mandate for the Congress-led United Progressive Alliance
(UPA) has boosted hopes a strong coalition would be able to push
through economic reforms that would boost foreign investment.
Prime Minister Manmohan Singh's coalition defied predictions of a
tight election and was only about 11 seats short of an majority
from the 543 seats at stake. Congress' alliance took 261 seats,
sweeping aside its nearest rival, the bloc led by the
Hindu-nationalist Bharatiya Janata Party (BJP), which won only 159
combined. Congress, which alone won 205 seats, needs a handful of
partners to reach the 272 seats needed to take power, and is
expected to seek the support of more smaller parties or
independents.
Meanwhile, Dr Manmohan Singh met President Pratibha Patil on Monday
and submitted the resignations of his Council of Ministers.
Manmohan Singh formally stepped down as the Prime Minister.
President Pratibha Patil on Monday dissolved the 14th Lok Sabha
with immediate effect and asked the Prime Minister and his Council
of Ministers to continue in office till the new government is
formed. The President is expected to today, 19 May 2009, invite Dr.
Singh to form the next government.
Armed with a decisive mandate, Manmohan Singh will meet the
President to show the UPA alliance has the numbers, and formally
stake claim to form a new government at the Centre.
Financial sector reforms are likely to get a push in the coming
days, which were relegated to the back seat due to persistent
opposition from the Left parties, with the Congress-led UPA set to
form the next government.
A near term trigger for the market will be allocation of portfolios
in the new government. It remains to be seen who gets the key
ministries viz. power, transport and education sectors. Analysts
say growth in these three sectors are key for India to achieve
strong economic growth. If those seen as strong performers are
given charge of these three ministries, the market may extend
gains.
As per reports, Congress's strong showing in election means
reformers will almost certainly be named to key ministerial
portfolios, including finance, trade, defence and foreign affairs.
The ministers should be named this week. Fresh reformist faces may
also join the cabinet for the first time, including Rahul Gandhi,
heir to the powerful Gandhi dynasty and seen as pushing a new
generation of leaders into the Congress.
As per market talks, P Chidambaram could retain his home portfolio.
Among the contenders for the finance ministry are C Rangarajan, an
economic adviser to the prime minister, Montek Singh Ahluwalia,
deputy chairman of the Planning Commission, Trade Minister Kamal
Nath, and External Affairs Minister Pranab Mukherjee.
According to analysts the new government should give priority to
reforming the subsidy mechanism which is aimed at improving
delivery mechanism while at the same time reducing costs. Restoring
fiscal health is also required. In this regard, disinvestment is an
immediate channel for raising funds
Foreign funds have bought aggressively in Indian stocks in the
recent past. FII inflow in May 2009 totaled Rs 10,270.60 crore in
May 2009 (till 15 May 2009) while their inflow in calendar year
2009 totaled Rs 10,627.20 crore.
Asian stocks rose today as higher confidence among US homebuilders,
a surge in oil prices and a drop in bank borrowing costs stoked
optimism the global economy is recovering. Key benchmark indices in
China, Hong Kong, Japan, South Korea, Singapore and Taiwan, rose by
between 0.91% to 3.34%.
US markets on Monday, 18 May 2009 closed at the session's high
helped by banks and financial services stocks. The Dow gained
235.44 points, or 2.9%, to 8,504.08. The S&P 500 index gained 26.83
points, or 3%, to 909.71. The Nasdaq composite index added 52.22
points, or 3.1%, to 1,732.36. A reading showed home builder
sentiment rose for the second month in a row and at the highest
level since September 2008.
At 10:07 IST, The BSE 30-share Sensex was down 294.38 points or
2.06% to 13,989.83. The Sensex rose 473.61 points at the day's high
of 14.757.82 in early trade. At the day's low of 13,834.13, the
Sensex fell 450.08 points in early trade.
The S&P CNX Nifty was down 123.55 points or 2.86% to 4,199.60.
The market breadth, indicating the overall health of the market,
was positive. On BSE, 851 shares rose as compared with 654 that
fell. A total of 83 shares remained unchanged.
From the 30 share Sensex pack, 20 stocks fell while rest gained.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) fell 2.68% to Rs 2290 on
profit taking after a recent sharp surge. Analysts expect strong
growth in bottom line in coming quarters from sale of gas which it
started pumping last month from its deep-sea field off the east
coast.
Banking stocks fell on profit taking after a recent sharp surge.
India's largest private sector bank by net profit ICICI Bank fell
1.37% even as its American depository receipt (ADR) rose 25.22% on
Monday, 18 May 2009.
India's second largest private sector bank by operating income HDFC
Bank was down 3.91% even as its ADR rose 21.29% overnight.
But India's biggest bank in terms of branch network State Bank of
India was up 2.55%. State Bank of India has cut interest rates on
deposits by up to 50 basis points effective Monday, 18 May 2009.
India's biggest dedicated housing finance firm by operating income
HDFC was down 0.5%. As per recent reports, HDFC is likely to cut
deposit rates and follow it with a cut in lending rates
Outsourcing focussed IT stocks fell on a stronger rupee. India's
second largest software services exporter by sales Infosys fell
9.03% even after its American depository receipt (ADR) rose 8.99%
overnight.
India's largest software services exporter by sales TCS fell 4.89%.
TCS last week it has been selected for a five-year IT services
contract for auto maker Volkswagen group's operations in the United
Kingdom.
India's third largest software services exporter by sales Wipro
rose fell 7.45% even after its ADR rose 7.48% overnight.
The rupee rose to five-month high on Tuesday, extending a 3.2%
rally in the previous session, after a win for the ruling coalition
in elections boosted hopes for reforms and foreign investment. The
partially convertible rupee was at 47.36/37 against the dollar, 1.1
% above Monday's close of 47.88/90. A stronger rupee affects
operating margins of IT firms negatively as they derive maximum
revenue from US.
Tuesday, May 19, 2009
Monday, May 18, 2009
Sensex vaults 17% as market cheers UPA's thumping victory in election; trading halted for day
A clear mandate for the Congress-led United Progressive Alliance
(UPA) in Lok Sabha elections send stocks surging with trading on
the bourses halted for the day at about 11:55 IST. For the first
time in the history of the stock markets trading was halted because
the market-wide circuit were applied due to a solid surge. Earlier,
there have been instances when trading was halted when market-wide
circuit filters were applied due to a market crash.
The 30-share Sensex was up 2099.21 points or 17.24% at 14,272.63
and the 50-unit S&P CNX Nifty gained 636.40 points or 17.33% to
4,308.05, when trading was halted for the day
BSE clocked a paltry turnover of Rs 77 crore. The combined turnover
in the cash and the derivatives segment of BSE and NSE totaled Rs
3103. Only 846 stocks were traded on the BSE while 202 stocks
witnessed action on the NSE.
Trading was halted in just 16 seconds after the market re-opened at
11:55 IST. Earlier in the day, trading was halted within seconds of
opening as the market soared following a clear mandate in the Lok
Sabha election. A clear mandate for the Congress-led United
Progressive Alliance (UPA) boosted hopes a strong coalition would
be able to push through economic reforms that would boost foreign
investment. The 30-share Sensex surged 14.70% or 1,789.88 points to
13,963.30 and the 50-unit S&P CNX Nifty gained 531.65 points or
14.48% to 4203.30.
The BSE Sensex attained its highest closing since 11 September 2008
and the S&P CNX Nifty attained its highest closing since 10
September 2008.
The market breadth, indicating the overall health of the market,
was strong. On BSE, 833 shares rose as compared with 11 that fell.
A total of 2 shares remained unchanged.
The BSE Mid-Cap index rose 12.06% and the BSE Small-Cap index rose
9.09%. However, both these indices underperformed the Sensex.
The BSE Realty index (up 25.37%), the BSE Capital Goods index (up
23.47%), the BSE Bankex (up 20.27%), the BSE Oil & Gas index (up
19.57%) outperformed the Sensex.
The BSE FMCG index (up 6.78%), the BSE Healthcare index (up 8.04%),
the BSE IT index (up 11.41%), the BSE Auto index (up 12.12%), the
BSE Consumer Durables index (up 13.63%), the BSE TECk index (up
14.95%), the BSE PSU index (up 15.76%), the BSE Metal index (up
16.64%), the BSE Power index (up 17.09%), underperfomed the Sensex.
The market soared today, 18 May 2009, following a thumping victory
of the Congress-led United Progressive Alliance (UPA) government in
the Lok Sabha elections. A clear mandate for the UPA boosted hopes
a strong coalition would be able to push through economic reforms
that would boost foreign investment
On BSE, Bharat Heavy Electricals, Reliance Industries, HDFC,
Reliance Infrastructure, ICICI Bank, Bharti Airtel, Larsen &
Toubro, DLF, Reliance Communications, Jaipraksh Associates, State
Bank of India, rose by between 20.76% to 32.72%.
Infrastructure shares jumped on hopes the Congress-led UPA
government may boost spending on infrastructure sector after
emerging victorious in the general elections. India's biggest
engineering & construction firm by revenue L&T rose nearly 30% to
Rs 1280. India's biggest power equipment maker by revenue Bharat
Heavy Electricals rose 32.7% to Rs 2266.
Among other infrastructure stocks, Jaiprakash Associates, Gammon
India, GVK Power & Infrastructure, GMR Infrastructure, and IVRCL
Infrastructures & Projects rose 20% to 38.3%
Punj Lloyd surged 23.2% ahead of the Q4 March 2009, ahead of the
announcement its Q4 March 2009 results later today, 18 May 2009.
Shares of power and capital goods companies surged following a
thumping victory of the Congress-led United Progressive Alliance
(UPA) government in the Lok Sabha elections, clearing the way for
the landmark civilian nuclear deal with the US. Areva T&D jumped
21%, Reliance Infrastructure rose 22%, Hindustan Construction
Company rose 25%, Crompton Greaves rose 13.8%, Tata Power Company
rose 13%, Rolta gained 13%, ABB rose 13.9%, NTPC gained 11.9%, and
Walchandnagar Industries rose 10%
State-run companies advanced on hopes of recommencement of the PSU
disinvestment programme after the Congress-led UPA government got a
clear mandate in the Lok Sabha election. Dredging Corporation of
India rose 20%, Engineers India advanced 19.3%, HMT rose 20%,
Neyveli Lignite Corporation advanced 17%, Shipping Corporation of
India rose 10%, Hindustan Copper rose 10%, MMTC rose 20%, NMDC rose
20%, Power Finance Corporation rose 13.3% and Central Bank of India
rose 18%
It may be recalled that the BJP-led National Democratic Alliance
(NDA) had vigorously pursued PSU divestment. However, it was put in
deep freeze in the last five years by the Congress-led United
Progressive Alliance (UPA) government as the Left parties which
supported the UPA government from outside, were bitterly opposed to
the idea.
Consequently, in the past five years, the government raised just Rs
8,500 crore from disinvestment as against Rs 28,000 crore raised by
the BJP-led government in the preceding five-year period.
The UPA government's thumping victory in the 15th Lok Sabha
elections without the support of the Left parties has raised
expectations that the government may revive disinvestment
programme. The Congress party had in its manifesto released before
polls promised to go ahead with disinvestment while retaining a
majority holding in the state-run companies.
India's largest bank in terms of assets and branch network State
Bank of India soared 20.76% on hopes the Congress-led UPA
government may go ahead on a plan to merge six associate banks with
State Bank of India to create a Indian banking behemoth.
The process of creating a Indian banking behemoth was set in motion
two years ago, but got derailed due to resistance from the Left
parties. Although the board of SBI and its associate bank, the
State Bank of Saurashtra, had approved the merger in August 2007,
the government approved it only in August 2008 after the Left
withdrew its support to the government.
A merger of the associate banks with itself will give SBI the full
benefit of size. SBI and its associate banks enjoy a fourth of the
market share.
The SBI management may well be keen to merge the six associates at
the earliest, but that will hinge on government approval since the
government controls 59.41% of the equity in the bank.
India's largest motorbike maker by sales Hero Honda Motors soared
15.83% as index focused mutual funds took position in the stock
ahead of its entry in the coveted BSE 30-share Sensex with effect
from 29 June 2009. After trading hours on Friday, 15 May 2009, the
BSE announced that Hero Honda will replace Ranbaxy Laboratories in
the barometer index BSE Sensex with effect from 29 June 2009
Prime Minister Manmohan Singh's coalition defied predictions of a
tight election and was only about 11 seats short of an majority
from the 543 seats at stake, according to election commission data.
Congress' alliance took 261 seats, sweeping aside its nearest
rival, the bloc led by the Hindu-nationalist Bharatiya Janata Party
(BJP), which won only 159 combined. Congress, which alone won 205
seats, needs a handful of partners to reach the 272 seats needed to
take power, and is expected to seek the support of more smaller
parties or independents. Congress leaders will meet on Tuesday to
officially endorse Manmohan Singh as prime minister, after which
the party will meet its coalition partners to decide potential new
allies.
Armed with a popular mandate, the Congress led UPA government is
going to stake claim today to run India for another five years. The
Congress and its allies will go to meet President Pratibha Patil
today to show that they have the numbers. The first meeting of the
newly-constituted Congress Parliamentary Party (CPP) is expected to
convened in a day or two to elect its leader. Singh, who is already
the Prime Ministerial candidate of the Congress, is also likely to
be elected by the MPs at a joint meeting of the UPA parties. The
Congress must form a government by 2 June 2009.
Financial sector reforms are likely to get a push in the coming
days, which were relegated to the back seat due to persistent
opposition from the Left parties, with the Congress-led UPA set to
form the next government. Left-less victory of the UPA over BJP-led
National Democratic Alliance (NDA) would not only signify the
formation of a stable government, but also revive hopes of a slew
of pro-market policy changes.
The index-based market-wide circuit breaker system applies at 3
stages of the index movement, either way viz. at 10%, 15% and 20%.
These circuit breakers when triggered, bring about a coordinated
trading halt in all equity and equity derivative markets
nationwide. The market-wide circuit breakers are triggered by
movement of either the BSE Sensex or the NSE S&P CNX Nifty,
whichever is breached earlier.
(UPA) in Lok Sabha elections send stocks surging with trading on
the bourses halted for the day at about 11:55 IST. For the first
time in the history of the stock markets trading was halted because
the market-wide circuit were applied due to a solid surge. Earlier,
there have been instances when trading was halted when market-wide
circuit filters were applied due to a market crash.
The 30-share Sensex was up 2099.21 points or 17.24% at 14,272.63
and the 50-unit S&P CNX Nifty gained 636.40 points or 17.33% to
4,308.05, when trading was halted for the day
BSE clocked a paltry turnover of Rs 77 crore. The combined turnover
in the cash and the derivatives segment of BSE and NSE totaled Rs
3103. Only 846 stocks were traded on the BSE while 202 stocks
witnessed action on the NSE.
Trading was halted in just 16 seconds after the market re-opened at
11:55 IST. Earlier in the day, trading was halted within seconds of
opening as the market soared following a clear mandate in the Lok
Sabha election. A clear mandate for the Congress-led United
Progressive Alliance (UPA) boosted hopes a strong coalition would
be able to push through economic reforms that would boost foreign
investment. The 30-share Sensex surged 14.70% or 1,789.88 points to
13,963.30 and the 50-unit S&P CNX Nifty gained 531.65 points or
14.48% to 4203.30.
The BSE Sensex attained its highest closing since 11 September 2008
and the S&P CNX Nifty attained its highest closing since 10
September 2008.
The market breadth, indicating the overall health of the market,
was strong. On BSE, 833 shares rose as compared with 11 that fell.
A total of 2 shares remained unchanged.
The BSE Mid-Cap index rose 12.06% and the BSE Small-Cap index rose
9.09%. However, both these indices underperformed the Sensex.
The BSE Realty index (up 25.37%), the BSE Capital Goods index (up
23.47%), the BSE Bankex (up 20.27%), the BSE Oil & Gas index (up
19.57%) outperformed the Sensex.
The BSE FMCG index (up 6.78%), the BSE Healthcare index (up 8.04%),
the BSE IT index (up 11.41%), the BSE Auto index (up 12.12%), the
BSE Consumer Durables index (up 13.63%), the BSE TECk index (up
14.95%), the BSE PSU index (up 15.76%), the BSE Metal index (up
16.64%), the BSE Power index (up 17.09%), underperfomed the Sensex.
The market soared today, 18 May 2009, following a thumping victory
of the Congress-led United Progressive Alliance (UPA) government in
the Lok Sabha elections. A clear mandate for the UPA boosted hopes
a strong coalition would be able to push through economic reforms
that would boost foreign investment
On BSE, Bharat Heavy Electricals, Reliance Industries, HDFC,
Reliance Infrastructure, ICICI Bank, Bharti Airtel, Larsen &
Toubro, DLF, Reliance Communications, Jaipraksh Associates, State
Bank of India, rose by between 20.76% to 32.72%.
Infrastructure shares jumped on hopes the Congress-led UPA
government may boost spending on infrastructure sector after
emerging victorious in the general elections. India's biggest
engineering & construction firm by revenue L&T rose nearly 30% to
Rs 1280. India's biggest power equipment maker by revenue Bharat
Heavy Electricals rose 32.7% to Rs 2266.
Among other infrastructure stocks, Jaiprakash Associates, Gammon
India, GVK Power & Infrastructure, GMR Infrastructure, and IVRCL
Infrastructures & Projects rose 20% to 38.3%
Punj Lloyd surged 23.2% ahead of the Q4 March 2009, ahead of the
announcement its Q4 March 2009 results later today, 18 May 2009.
Shares of power and capital goods companies surged following a
thumping victory of the Congress-led United Progressive Alliance
(UPA) government in the Lok Sabha elections, clearing the way for
the landmark civilian nuclear deal with the US. Areva T&D jumped
21%, Reliance Infrastructure rose 22%, Hindustan Construction
Company rose 25%, Crompton Greaves rose 13.8%, Tata Power Company
rose 13%, Rolta gained 13%, ABB rose 13.9%, NTPC gained 11.9%, and
Walchandnagar Industries rose 10%
State-run companies advanced on hopes of recommencement of the PSU
disinvestment programme after the Congress-led UPA government got a
clear mandate in the Lok Sabha election. Dredging Corporation of
India rose 20%, Engineers India advanced 19.3%, HMT rose 20%,
Neyveli Lignite Corporation advanced 17%, Shipping Corporation of
India rose 10%, Hindustan Copper rose 10%, MMTC rose 20%, NMDC rose
20%, Power Finance Corporation rose 13.3% and Central Bank of India
rose 18%
It may be recalled that the BJP-led National Democratic Alliance
(NDA) had vigorously pursued PSU divestment. However, it was put in
deep freeze in the last five years by the Congress-led United
Progressive Alliance (UPA) government as the Left parties which
supported the UPA government from outside, were bitterly opposed to
the idea.
Consequently, in the past five years, the government raised just Rs
8,500 crore from disinvestment as against Rs 28,000 crore raised by
the BJP-led government in the preceding five-year period.
The UPA government's thumping victory in the 15th Lok Sabha
elections without the support of the Left parties has raised
expectations that the government may revive disinvestment
programme. The Congress party had in its manifesto released before
polls promised to go ahead with disinvestment while retaining a
majority holding in the state-run companies.
India's largest bank in terms of assets and branch network State
Bank of India soared 20.76% on hopes the Congress-led UPA
government may go ahead on a plan to merge six associate banks with
State Bank of India to create a Indian banking behemoth.
The process of creating a Indian banking behemoth was set in motion
two years ago, but got derailed due to resistance from the Left
parties. Although the board of SBI and its associate bank, the
State Bank of Saurashtra, had approved the merger in August 2007,
the government approved it only in August 2008 after the Left
withdrew its support to the government.
A merger of the associate banks with itself will give SBI the full
benefit of size. SBI and its associate banks enjoy a fourth of the
market share.
The SBI management may well be keen to merge the six associates at
the earliest, but that will hinge on government approval since the
government controls 59.41% of the equity in the bank.
India's largest motorbike maker by sales Hero Honda Motors soared
15.83% as index focused mutual funds took position in the stock
ahead of its entry in the coveted BSE 30-share Sensex with effect
from 29 June 2009. After trading hours on Friday, 15 May 2009, the
BSE announced that Hero Honda will replace Ranbaxy Laboratories in
the barometer index BSE Sensex with effect from 29 June 2009
Prime Minister Manmohan Singh's coalition defied predictions of a
tight election and was only about 11 seats short of an majority
from the 543 seats at stake, according to election commission data.
Congress' alliance took 261 seats, sweeping aside its nearest
rival, the bloc led by the Hindu-nationalist Bharatiya Janata Party
(BJP), which won only 159 combined. Congress, which alone won 205
seats, needs a handful of partners to reach the 272 seats needed to
take power, and is expected to seek the support of more smaller
parties or independents. Congress leaders will meet on Tuesday to
officially endorse Manmohan Singh as prime minister, after which
the party will meet its coalition partners to decide potential new
allies.
Armed with a popular mandate, the Congress led UPA government is
going to stake claim today to run India for another five years. The
Congress and its allies will go to meet President Pratibha Patil
today to show that they have the numbers. The first meeting of the
newly-constituted Congress Parliamentary Party (CPP) is expected to
convened in a day or two to elect its leader. Singh, who is already
the Prime Ministerial candidate of the Congress, is also likely to
be elected by the MPs at a joint meeting of the UPA parties. The
Congress must form a government by 2 June 2009.
Financial sector reforms are likely to get a push in the coming
days, which were relegated to the back seat due to persistent
opposition from the Left parties, with the Congress-led UPA set to
form the next government. Left-less victory of the UPA over BJP-led
National Democratic Alliance (NDA) would not only signify the
formation of a stable government, but also revive hopes of a slew
of pro-market policy changes.
The index-based market-wide circuit breaker system applies at 3
stages of the index movement, either way viz. at 10%, 15% and 20%.
These circuit breakers when triggered, bring about a coordinated
trading halt in all equity and equity derivative markets
nationwide. The market-wide circuit breakers are triggered by
movement of either the BSE Sensex or the NSE S&P CNX Nifty,
whichever is breached earlier.
Subscribe to:
Posts (Atom)