The key benchmark indices extended gains in mid-morning trade. The
BSE Sensex was up 183 points. IT stocks fell while, banking and
capital goods stocks rose. Buying was also seen in mid-cap and
small-cap stocks. The market breadth was positive. Sterlite
Industries rose more than 5.5%.
The market sentiment was boosted by Warren Buffett's Berkshire
Hathaway's announcment of an infusion of $5 billion in Goldman
Sachs Group. US stocks futures rose after the news which was
announced after the US markets had closed on Tuesday, 23 September
2008. Goldman will sell $5 billion of preferred stock to Berkshire
Hathaway, which will also receive warrants to purchase $5 billion
of common stock with a strike price of $115 per share. Berkshire
has five years to exercise the warrants.
The Dow futures were up 120 points and the Nasdaq futures were up
24.25 points
Asian markets were trading mixed today, 24 September 2008. Key
benchmark indices in Hong Kong, Singapore, and South Korea were up
by between 0.77% to 1.28%. Key benchmark indices in Japan, China
and Taiwan were down by between 0.03% to 2.41%.
Meanwhile, a US-India civilian nuclear cooperation agreement moved
closer to approval by Congress on Tuesday, 23 September 2008, when
a key Senate Committee passed the deal with a landslide majority.
However, the historic agreement is yet to clear a few hurdles in
its final lap. The bill now goes to the floor of the Senate for the
final ratification.
At 11:22 IST, the BSE 30-share Sensex was up 183 points or 1.35% to
13,754.16. The Sensex rose 187.40 points at day's high of
13,757.71, hit in mid-morning trade. The index shed 56.25 points at
the day's low of 13,626.56, hit in the onset of trading session.
The S&P CNX Nifty was up 52.70 points or 1.28% to 4,179.60.
The BSE Mid-Cap index was up 0.94% at 5,161.34 and the BSE
Small-Cap index was up 0.0.83% at 6,143.90.
The market breadth was positive on BSE with 1295 shares advancing
as compared to 757 that declined. 70 shares remained unchanged.
India's largest private sector firm by market capitalization and
oil refiner Reliance Industries rose 1.61% to Rs 2,042.
Banking stocks rose. HDFC Bank (up 2.71% to Rs 1271.25), ICICI Bank
(up 2.82% to Rs 616.20), and State Bank of India Bank (up 1.41% to
Rs 1523.70), gained from the frontline banking pack. More than
900,000 employees of India's state-owned banks will go on a two-day
strike from today, 24 September 2008, protesting against government
plans to merge banks and seeking higher salaries.
Capital goods stocks rose. Larsen & Toubro (up 1.63% to Rs 2,571),
Bharat Heavy Electricals (up 2.02% to Rs 1,659) and Suzlon Energy
(up 2.51% to Rs 198.30) edged higher.
IT stocks fell. Satyam Computer Services (down 4.21% to Rs 318),
and Wipro (down 3.44% to Rs 377) and Infosys (down 0.58% to Rs
1,534.40) edged lower. India's largest IT exporter by sales Tata
Consultancy Services rose 0.59% to Rs 723.10.
India's largest mobile services provider in terms of market share
Bharti Airtel declined 0.4% to Rs 791.05.
Sterlite Industries (up 5.79% to Rs 476.05), Jaiprakash Associates
(up 2.44% to Rs 126.05), Reliance Communications (up 1.86% to Rs
374.05), HDFC (up 1.81% to Rs 2237.90), edged higher from the
Sensex pack.
India's largest drug maker by sales Ranbaxy Laboratories rose 1.1%
to Rs 312.25. Japan's third-largest drugmaker Daiichi Sankyo said
on Wednesday, 24 September 2008, its open offer to buy up to 20%
stake in generic drugmaker Ranbaxy Laboratories was oversubscribed.
Investors had tendered more than 92.5 million Ranbaxy shares
between in the open offer, Daiichi Sankyo said.
In June 2008, Daiichi Sankyo had agreed to buy the 34.8% held by
Ranbaxy's founding family, and to make an open offer for a further
20% of Ranbaxy shares, as per Securities & Exchange Board of India
(Sebi) takeover regulations.
US stocks fell on Tuesday, 23 September 2008, on fear that
congressional wrangling could delay a proposed $700 billion plan to
rescue the financial sector, increasing worries about the
struggling US economy. The Dow Jones industrial average fell 161.52
points, or 1.47%, to end at 10,854.17. The Standard & Poor's 500
Index slid 18.87 points, or 1.56%, to 1,188.22. The Nasdaq
Composite Index dropped 25.64 points, or 1.18%, to 2,153.34.
The trading on the bourses will be extended to 16:15 IST starting
today due to Sun Outage. On BSE, there will be no trading from
11:25 IST to 12:10 IST as there will be signal problems during this
time.
Wednesday, September 24, 2008
Nikkei pares losses, U.S. bank plans boost financials
TOKYO (Reuters) - Japan's Nikkei stock market average was down 0.2 percent on Wednesday, paring early losses, as Nomura Holdings Inc and other financial stocks climbed on hopes that planned investments in U.S. banks would help the sector.
Sumitomo Mitsui Financial Group (SMFG) rose after media reports said Japan's third-largest bank planned to invest in U.S. investment bank Goldman Sachs, though a spokeswoman for SMFG said the bank did not have such plans at this time. But investor worries about possible delays to a proposed $700 billion plan to rescue the U.S. financial sector, plus concern about the overall health of the global economy, were likely to keep any recovery limited. "Even if the U.S. financial situation is cleared up, worry about the underlying health of the economy will remain, especially given that economic weakness is growing in Europe," said Masayuki Yamagishi, a strategist with Mitsubishi UFJ Securities.
"Investors are still wondering how much real impact the U.S. government rescue plan will have, plus it still hasn't been approved by Congress."
Defensive shares, such as pharmaceuticals and food companies, were doing comparatively well as a result, helping to support the overall market, he added.
By 0447 GMT the Nikkei had lost 19.29 points to 12,071.30. The broader Topix was down 0.5 percent at 1,163.33 after earlier falling more than 2 percent.
Nomura, Japan's largest broker, surged 6.3 percent to 1,522 yen after the company said it would buy the Asian and European operations of failed U.S. investment bank Lehman Brothers to help it expand overseas.
Mitsubishi UFJ Financial Group extended gains to 4.9 percent and 941 yen after Japan's largest bank said it would take a stake in U.S. investment bank Morgan Stanley.
The securities sub-index was the top gainer among the sub-indices, rising 3.5 percent.
Eisai Co Ltd rose 4 percent to 4,120 yen, among many pharmaceuticals helping to lift the Nikkei. Shionogi & Co Ltd gained 6.2 percent to 2,245 yen.
Takeda Pharmaceutical Co was up 1.7 percent after saying on Wednesday it had applied for approval to market in the United States the SYR-322 and the Actos diabetes drugs in a single tablet for the treatment of type 2 diabetes.
Sumitomo Mitsui Financial Group (SMFG) rose after media reports said Japan's third-largest bank planned to invest in U.S. investment bank Goldman Sachs, though a spokeswoman for SMFG said the bank did not have such plans at this time. But investor worries about possible delays to a proposed $700 billion plan to rescue the U.S. financial sector, plus concern about the overall health of the global economy, were likely to keep any recovery limited. "Even if the U.S. financial situation is cleared up, worry about the underlying health of the economy will remain, especially given that economic weakness is growing in Europe," said Masayuki Yamagishi, a strategist with Mitsubishi UFJ Securities.
"Investors are still wondering how much real impact the U.S. government rescue plan will have, plus it still hasn't been approved by Congress."
Defensive shares, such as pharmaceuticals and food companies, were doing comparatively well as a result, helping to support the overall market, he added.
By 0447 GMT the Nikkei had lost 19.29 points to 12,071.30. The broader Topix was down 0.5 percent at 1,163.33 after earlier falling more than 2 percent.
Nomura, Japan's largest broker, surged 6.3 percent to 1,522 yen after the company said it would buy the Asian and European operations of failed U.S. investment bank Lehman Brothers to help it expand overseas.
Mitsubishi UFJ Financial Group extended gains to 4.9 percent and 941 yen after Japan's largest bank said it would take a stake in U.S. investment bank Morgan Stanley.
The securities sub-index was the top gainer among the sub-indices, rising 3.5 percent.
Eisai Co Ltd rose 4 percent to 4,120 yen, among many pharmaceuticals helping to lift the Nikkei. Shionogi & Co Ltd gained 6.2 percent to 2,245 yen.
Takeda Pharmaceutical Co was up 1.7 percent after saying on Wednesday it had applied for approval to market in the United States the SYR-322 and the Actos diabetes drugs in a single tablet for the treatment of type 2 diabetes.
Rupee weaker on arbitrage, volume low
MUMBAI (Reuters) - The rupee was weaker on Wednesday as banks bought dollars locally to arbitrage in the offshore market, but trade was thin as a two-day strike by state-run bank workers affected volume.
At 10:30 a.m., the partially convertible rupee was at 45.81/83 per dollar, 0.2 percent weaker than 45.72/73 at close on Tuesday.
"There is mostly inter-bank buying today, but volumes are lower as state-run banks are on strike. It is likely to stay in a band of 45.70/45.95," a senior dealer with a primary dealership said.
"There is some pressure on the rupee from the offshore side as well," he added.
One-month offshore non-deliverable forward contracts were quoting at 45.96/46.06, weaker than the onshore spot rate. Banks buy dollars locally and sell in the offshore market to cash in on the price differential.
Indian public sector bank employees began a the strike on Wednesday after talks between their union and the chief labour commissioner failed over demands for wage increases and deferment of stake sales in state banks.
The BSE Sensex opened up 0.5 percent on short covering ahead of the monthly futures expiry, but concerns U.S. lawmakers will stall a proposed $700 billion bailout of the financial sector may limit the gains.
Dealers said there was no dollar demand from oil companies in early trade, but if demand came in during the later half, it could pressure the rupee lower.
Oil, India's biggest import, was trading around $107 per barrel. Refiners are the largest buyers of dollars in the local currency market.
At 10:30 a.m., the partially convertible rupee was at 45.81/83 per dollar, 0.2 percent weaker than 45.72/73 at close on Tuesday.
"There is mostly inter-bank buying today, but volumes are lower as state-run banks are on strike. It is likely to stay in a band of 45.70/45.95," a senior dealer with a primary dealership said.
"There is some pressure on the rupee from the offshore side as well," he added.
One-month offshore non-deliverable forward contracts were quoting at 45.96/46.06, weaker than the onshore spot rate. Banks buy dollars locally and sell in the offshore market to cash in on the price differential.
Indian public sector bank employees began a the strike on Wednesday after talks between their union and the chief labour commissioner failed over demands for wage increases and deferment of stake sales in state banks.
The BSE Sensex opened up 0.5 percent on short covering ahead of the monthly futures expiry, but concerns U.S. lawmakers will stall a proposed $700 billion bailout of the financial sector may limit the gains.
Dealers said there was no dollar demand from oil companies in early trade, but if demand came in during the later half, it could pressure the rupee lower.
Oil, India's biggest import, was trading around $107 per barrel. Refiners are the largest buyers of dollars in the local currency market.
Etisalat to acquire 45% stake in Swan Telecom for $900 million
New Delhi: The second largest Arab telecom company by market value, Emirates Telecommunications Corp., or Etisalat, said on Tuesday it has agreed to buy a 45% stake in Swan Telecom Pvt. Ltd that recently acquired licences to provide mobile telephony in India.
The deal would have to be cleared by the Foreign Investment Promotion Board, or FIPB, telecom minister A. Raja said on the sidelines of a function in New Delhi.
United Arab Emirates-based Etisalat said by email from Abu Dhabi that it has agreed to buy some 45% of Swan Telecom for cash up to $900 million (Rs4,113 crore).
The remaining 55% of the shares of Swan Telecom are held by several entities, including its promoters Dynamix Balwas Group, the email said.
New connection: A mobile telecom tower. Swan Telecom has licences to provide mobile phone services in 10 out of 22 circles in India. Harikrishna Katragadda / MintSeparately, Swan Telecom’s managing director, Shahid Balwa, said: “As of today, we have got spectrum in 10 circles. We will be launching our first operation in the first quarter of next financial year. The spectrum in 10 circles includes the lucrative Delhi service area.”
The Business Standard newspaper first reported on Tuesday that Etisalat would pick up 49% in Swan Telecom and increase the stake to 51% after FIPB approved the deal, quoting unnamed sources.
Etisalat offers phone services in 16 countries across Asia, West Asia and Africa, servicing more than 64 million customers. The company reported annual net revenues of $5.8 billion and net profits of $1.83 billion for 2007.
Etisalat also has a fully owned subsidiary in Bangalore, Etisalat Software Solutions, that sells operational and billing support systems to the telecom industry.
Mumbai-based real estate and hospitality group Dynamix Balwas Group has assets of about $4 billion.
Swan Telecom has got licences to provide mobile phone services on the GSM, or global system for mobile communications, technology platform in 10 out of 22 telecom circles in India, and is awaiting clearance for another two circles, the company said.
“This is good news as the move to expand globally beyond its operations in the UAE is expected to be viewed positively because that way it diversifies its operations and does not depend on only one market,” said Sherif Abdelkhalek, institutions account manager at Beltone Financial, an investment bank operating in West Asia and North Africa.
“The share price might not immediately react to the news because of current market conditions but in the long and medium term, this will benefit revenues and share price,” Abdelkhalek said.
Citigroup Global Markets Ltd and Deutsche Bank AG were advisers for Etisalat and Swan Telecom, respectively.
Swan Telecom’s Balwa said Indian shareholders would remain the controlling stakeholders in Swan Telecom after the Etisalat deal.
A telecom expert said Etisalat always wanted to come to India and only new players could be its potential candidates. “Given the telecom licence and roll-out obligations, and what they want to do, there is always a certain valuation attached to it,” said Rajesh Jain, national industry director for information, communication and entertainment practice at consultancy KPMG India Pvt. Ltd.
The deal would have to be cleared by the Foreign Investment Promotion Board, or FIPB, telecom minister A. Raja said on the sidelines of a function in New Delhi.
United Arab Emirates-based Etisalat said by email from Abu Dhabi that it has agreed to buy some 45% of Swan Telecom for cash up to $900 million (Rs4,113 crore).
The remaining 55% of the shares of Swan Telecom are held by several entities, including its promoters Dynamix Balwas Group, the email said.
New connection: A mobile telecom tower. Swan Telecom has licences to provide mobile phone services in 10 out of 22 circles in India. Harikrishna Katragadda / MintSeparately, Swan Telecom’s managing director, Shahid Balwa, said: “As of today, we have got spectrum in 10 circles. We will be launching our first operation in the first quarter of next financial year. The spectrum in 10 circles includes the lucrative Delhi service area.”
The Business Standard newspaper first reported on Tuesday that Etisalat would pick up 49% in Swan Telecom and increase the stake to 51% after FIPB approved the deal, quoting unnamed sources.
Etisalat offers phone services in 16 countries across Asia, West Asia and Africa, servicing more than 64 million customers. The company reported annual net revenues of $5.8 billion and net profits of $1.83 billion for 2007.
Etisalat also has a fully owned subsidiary in Bangalore, Etisalat Software Solutions, that sells operational and billing support systems to the telecom industry.
Mumbai-based real estate and hospitality group Dynamix Balwas Group has assets of about $4 billion.
Swan Telecom has got licences to provide mobile phone services on the GSM, or global system for mobile communications, technology platform in 10 out of 22 telecom circles in India, and is awaiting clearance for another two circles, the company said.
“This is good news as the move to expand globally beyond its operations in the UAE is expected to be viewed positively because that way it diversifies its operations and does not depend on only one market,” said Sherif Abdelkhalek, institutions account manager at Beltone Financial, an investment bank operating in West Asia and North Africa.
“The share price might not immediately react to the news because of current market conditions but in the long and medium term, this will benefit revenues and share price,” Abdelkhalek said.
Citigroup Global Markets Ltd and Deutsche Bank AG were advisers for Etisalat and Swan Telecom, respectively.
Swan Telecom’s Balwa said Indian shareholders would remain the controlling stakeholders in Swan Telecom after the Etisalat deal.
A telecom expert said Etisalat always wanted to come to India and only new players could be its potential candidates. “Given the telecom licence and roll-out obligations, and what they want to do, there is always a certain valuation attached to it,” said Rajesh Jain, national industry director for information, communication and entertainment practice at consultancy KPMG India Pvt. Ltd.
FBI probes financial giants for fraud
Washington: The US Federal Bureau of Investigation is probing allegations of fraud by 26 Wall Street firms including several investment giants whose collapse sent world markets into turmoil, US media said on Tuesday.
The FBI has set its sights on investment titan Lehman Brothers, mortgage giants Fannie Mae and Freddie Mac and insurer AIG, in a wide-reaching inquiry that comes as lawmakers rush to agree a $700 billion government bailout of the troubled US financial sector.
The FBI probe aims to determine whether company executives had any responsibility for the institutions’ financial woes through “misinformation or material misinformation,” CNN said.
FBI Director Robert Mueller said last week that the bureau was probing 24 financial institutions, but gave no details other than to describe them as “large corporations” that may face allegations of misstated assets.
ABC News said the probe was “multifaceted and the net is much deeper than the major firms officials confirmed today,” adding that the probe had expanded from 14 major firms to 26 in less than a year.
“The FBI currently has 26 pending corporate fraud investigations involving subprime lenders,” FBI spokesman Richard Kolko told ABC.
“As we have seen, this number can fluctuate over time; however, we do not discuss which companies may or may not be the subject of an investigation.”
Lehman Brothers earlier this month became the latest victim of the US subprime mortgage crisis, which began with a wave of foreclosures by high-risk borrowers in the United States and now threatens the global financial system.
Details of the FBI investigation broke after lawmakers in Washington grappled for a second day with the hefty bailout proposal to absorb shaky mortgage-backed debt weighing on banks and other financial institutions.
The uncertainty prompted fresh turmoil on financial markets and the main global stock markets were hit hard.
Federal Reserve chairman Ben Bernanke and Treasury Secretary Henry Paulson said the rescue plan was urgently need to avert a deeper economic crisis.
The FBI has set its sights on investment titan Lehman Brothers, mortgage giants Fannie Mae and Freddie Mac and insurer AIG, in a wide-reaching inquiry that comes as lawmakers rush to agree a $700 billion government bailout of the troubled US financial sector.
The FBI probe aims to determine whether company executives had any responsibility for the institutions’ financial woes through “misinformation or material misinformation,” CNN said.
FBI Director Robert Mueller said last week that the bureau was probing 24 financial institutions, but gave no details other than to describe them as “large corporations” that may face allegations of misstated assets.
ABC News said the probe was “multifaceted and the net is much deeper than the major firms officials confirmed today,” adding that the probe had expanded from 14 major firms to 26 in less than a year.
“The FBI currently has 26 pending corporate fraud investigations involving subprime lenders,” FBI spokesman Richard Kolko told ABC.
“As we have seen, this number can fluctuate over time; however, we do not discuss which companies may or may not be the subject of an investigation.”
Lehman Brothers earlier this month became the latest victim of the US subprime mortgage crisis, which began with a wave of foreclosures by high-risk borrowers in the United States and now threatens the global financial system.
Details of the FBI investigation broke after lawmakers in Washington grappled for a second day with the hefty bailout proposal to absorb shaky mortgage-backed debt weighing on banks and other financial institutions.
The uncertainty prompted fresh turmoil on financial markets and the main global stock markets were hit hard.
Federal Reserve chairman Ben Bernanke and Treasury Secretary Henry Paulson said the rescue plan was urgently need to avert a deeper economic crisis.
Market opens on a firm note
News that Warren Buffett's Berkshire Hathaway has agreed an
infusion of $5 billion in Goldman Sachs Group, boosted the bourses
in early trade today, 24 September 2008. The BSE 30-share Sensex
was up 78.86 points. Power and realty stocks rose. The market
breadth was positive. Asian markets which opened before Indian
market were mixed.
Goldman will sell $5 billion of preferred stock to Berkshire
Hathaway, which will also receive warrants to purchase $5 billion
of common stock with a strike price of $115 per share. Berkshire
has five years to exercise the warrants.
Asian markets were trading mixed today, 24 September 2008. Key
benchmark indices in Hong Kong, Singapore, and South Korea were up
by between 0.29% to 0.9%. Key benchmark indices in Japan and Taiwan
were down by between 0.19% to 0.88%.
Meanwhile, a US-India civilian nuclear cooperation agreement moved
closer to approval by Congress on Tuesday, 23 September 2008, when
a key Senate Committee passed the deal with a landslide majority.
However, the historic agreement is yet to clear a few hurdles in
its final lap. The bill now goes to the floor of the Senate for the
final ratification.
At 10:19 IST, the BSE 30-share Sensex was up 78.86 points or 0.58%
to 13,650.26. The index shed 56.25 points at the day's low of
13,626.56, hit in early trade. The Sensex rose 122.97 points at
day's high of 13,693.28, hit in early trade.
The S&P CNX Nifty was up 16.80 points or 0.41% to 4,143.70.
The BSE Mid-Cap index was up 0.62% at 5,144.86 and the BSE
Small-Cap index was up 0.42% at 6,118.50.
The market breadth was positive on BSE with 849 shares advancing as
compared to 395 that declined. 32 shares remained unchanged.
India's largest private sector firm by market capitalization and
oil refiner Reliance Industries rose 1.16% to Rs 2,035.15.
Rate sensitive realty stocks rose. Indiabulls Real Estate (up 2.82%
to Rs 215.25), Unitech (up 0.89% to Rs 124.90) and DLF (up 1.7% to
Rs 401.90) edged higher.
Power stocks also rose. Reliance Power (up 1.62% to Rs 162.65),
Reliance Infrastructure (up 1.39% to Rs 876), NTPC (up 1.2% to Rs
182.20), PowerGrid Corporation of India (up 0.99% to Rs 92), and
Tata Power Company (up 1.22% to Rs 1,034.15) edged higher.
Satyam Computer Services (down 3.18% to Rs 321.10), Wipro (down
2.16% to Rs 382), Bharti Airtel (down 1.66% to Rs 781.95), ACC
(down 0.36% to Rs 623.95) and ONGC (down 0.77% to Rs 1,047) edged
lower from the Sensex pack.
Sterlite Industries (up 4.06% to Rs 468), HDFC Bank (up 2.12% to Rs
1,264), ICICI Bank (up 1.64% to Rs 609.10), Maruti Suzuki India (up
1.14% to Rs 708.50) edged higher from the Sensex pack.
India's largest drug maker by sales Ranbaxy Laboratories rose 1.52%
to Rs 313.55. Japan's third-largest drugmaker Daiichi Sankyo said
on Wednesday, 24 September 2008, its open offer to buy up to 20%
stake in generic drugmaker Ranbaxy Laboratories was oversubscribed.
Investors had tendered more than 92.5 million Ranbaxy shares
between in the open offer, Daiichi Sankyo said.
In June 2008, Daiichi Sankyo had agreed to buy the 34.8% held by
Ranbaxy's founding family, and to make an open offer for a further
20% of Ranbaxy shares, as per Securities & Exchange Board of India
(Sebi) takeover regulations.
Balaji Telefilms surged 4.92% to Rs 154.10. The company is
reportedly finalising a blue-print of its own Hindi general
entertainment venture, which is slated for launch at the end of
2008 or early 2009.
KSK Energy Ventures rose 1.84% to Rs 235. The company has completed
financial tie-ups for its 1,800 megawatt power project being
implemented by its wholly-owned subsidiary, Wardha Power Company,
in Chhattisgarh.
Abbott India declined 5.37% to Rs 485. Net profit of Abbott India
declined 11.71% to Rs 17.57 crore on 12.76% growth in sales to Rs
177.85 crore in the quarter ended August 2008 over the quarter
ended August 2007. The results hit the market after trading hours
on Tuesday, 23 September 2008.
Pyramid Saimira Theatre fell 0.74% to Rs 114.05. The company said
on Tuesday, it would not proceed with its acquisition plans in the
UK and Europe and consolidate its business in the south India. "The
management has decided not to focus on core European market," it
said in a statement.
US stocks fell on Tuesday, 23 September 2008, on fear that
congressional wrangling could delay a proposed $700 billion plan to
rescue the financial sector, increasing worries about the
struggling US economy. The Dow Jones industrial average fell 161.52
points, or 1.47%, to end at 10,854.17. The Standard & Poor's 500
Index slid 18.87 points, or 1.56%, to 1,188.22. The Nasdaq
Composite Index dropped 25.64 points, or 1.18%, to 2,153.34.
As per the provisional data released by the stock exchanges,
foreign funds on Tuesday, 23 September 2008, sold shares worth a
net Rs 924.40 crore. Domestic fund bought shares worth a net Rs
68.77 crore.
The September 2008 contracts expire on Thursday, 25 September 2008.
Roll over in Nifty futures till Tuesday, 23 September 2008, was
about 40%.
Meanwhile, trading on the bourses will be extended to 16:15 IST
starting today due to Sun Outage. On BSE, there will be no trading
from 11:25 IST to 12:10 IST as there will be signal problems during
this time.
infusion of $5 billion in Goldman Sachs Group, boosted the bourses
in early trade today, 24 September 2008. The BSE 30-share Sensex
was up 78.86 points. Power and realty stocks rose. The market
breadth was positive. Asian markets which opened before Indian
market were mixed.
Goldman will sell $5 billion of preferred stock to Berkshire
Hathaway, which will also receive warrants to purchase $5 billion
of common stock with a strike price of $115 per share. Berkshire
has five years to exercise the warrants.
Asian markets were trading mixed today, 24 September 2008. Key
benchmark indices in Hong Kong, Singapore, and South Korea were up
by between 0.29% to 0.9%. Key benchmark indices in Japan and Taiwan
were down by between 0.19% to 0.88%.
Meanwhile, a US-India civilian nuclear cooperation agreement moved
closer to approval by Congress on Tuesday, 23 September 2008, when
a key Senate Committee passed the deal with a landslide majority.
However, the historic agreement is yet to clear a few hurdles in
its final lap. The bill now goes to the floor of the Senate for the
final ratification.
At 10:19 IST, the BSE 30-share Sensex was up 78.86 points or 0.58%
to 13,650.26. The index shed 56.25 points at the day's low of
13,626.56, hit in early trade. The Sensex rose 122.97 points at
day's high of 13,693.28, hit in early trade.
The S&P CNX Nifty was up 16.80 points or 0.41% to 4,143.70.
The BSE Mid-Cap index was up 0.62% at 5,144.86 and the BSE
Small-Cap index was up 0.42% at 6,118.50.
The market breadth was positive on BSE with 849 shares advancing as
compared to 395 that declined. 32 shares remained unchanged.
India's largest private sector firm by market capitalization and
oil refiner Reliance Industries rose 1.16% to Rs 2,035.15.
Rate sensitive realty stocks rose. Indiabulls Real Estate (up 2.82%
to Rs 215.25), Unitech (up 0.89% to Rs 124.90) and DLF (up 1.7% to
Rs 401.90) edged higher.
Power stocks also rose. Reliance Power (up 1.62% to Rs 162.65),
Reliance Infrastructure (up 1.39% to Rs 876), NTPC (up 1.2% to Rs
182.20), PowerGrid Corporation of India (up 0.99% to Rs 92), and
Tata Power Company (up 1.22% to Rs 1,034.15) edged higher.
Satyam Computer Services (down 3.18% to Rs 321.10), Wipro (down
2.16% to Rs 382), Bharti Airtel (down 1.66% to Rs 781.95), ACC
(down 0.36% to Rs 623.95) and ONGC (down 0.77% to Rs 1,047) edged
lower from the Sensex pack.
Sterlite Industries (up 4.06% to Rs 468), HDFC Bank (up 2.12% to Rs
1,264), ICICI Bank (up 1.64% to Rs 609.10), Maruti Suzuki India (up
1.14% to Rs 708.50) edged higher from the Sensex pack.
India's largest drug maker by sales Ranbaxy Laboratories rose 1.52%
to Rs 313.55. Japan's third-largest drugmaker Daiichi Sankyo said
on Wednesday, 24 September 2008, its open offer to buy up to 20%
stake in generic drugmaker Ranbaxy Laboratories was oversubscribed.
Investors had tendered more than 92.5 million Ranbaxy shares
between in the open offer, Daiichi Sankyo said.
In June 2008, Daiichi Sankyo had agreed to buy the 34.8% held by
Ranbaxy's founding family, and to make an open offer for a further
20% of Ranbaxy shares, as per Securities & Exchange Board of India
(Sebi) takeover regulations.
Balaji Telefilms surged 4.92% to Rs 154.10. The company is
reportedly finalising a blue-print of its own Hindi general
entertainment venture, which is slated for launch at the end of
2008 or early 2009.
KSK Energy Ventures rose 1.84% to Rs 235. The company has completed
financial tie-ups for its 1,800 megawatt power project being
implemented by its wholly-owned subsidiary, Wardha Power Company,
in Chhattisgarh.
Abbott India declined 5.37% to Rs 485. Net profit of Abbott India
declined 11.71% to Rs 17.57 crore on 12.76% growth in sales to Rs
177.85 crore in the quarter ended August 2008 over the quarter
ended August 2007. The results hit the market after trading hours
on Tuesday, 23 September 2008.
Pyramid Saimira Theatre fell 0.74% to Rs 114.05. The company said
on Tuesday, it would not proceed with its acquisition plans in the
UK and Europe and consolidate its business in the south India. "The
management has decided not to focus on core European market," it
said in a statement.
US stocks fell on Tuesday, 23 September 2008, on fear that
congressional wrangling could delay a proposed $700 billion plan to
rescue the financial sector, increasing worries about the
struggling US economy. The Dow Jones industrial average fell 161.52
points, or 1.47%, to end at 10,854.17. The Standard & Poor's 500
Index slid 18.87 points, or 1.56%, to 1,188.22. The Nasdaq
Composite Index dropped 25.64 points, or 1.18%, to 2,153.34.
As per the provisional data released by the stock exchanges,
foreign funds on Tuesday, 23 September 2008, sold shares worth a
net Rs 924.40 crore. Domestic fund bought shares worth a net Rs
68.77 crore.
The September 2008 contracts expire on Thursday, 25 September 2008.
Roll over in Nifty futures till Tuesday, 23 September 2008, was
about 40%.
Meanwhile, trading on the bourses will be extended to 16:15 IST
starting today due to Sun Outage. On BSE, there will be no trading
from 11:25 IST to 12:10 IST as there will be signal problems during
this time.
Pre Market Report 24/09/2008
The market may edge higher after Warren Buffett's Berkshire Hathaway announced an infusion of $5 billion in Goldman Sachs Group. US stocks futures rose after the news which was announced after the US markets had closed on Tuesday, 23 September 2008. Goldman will sell $5 billion of preferred stock to Berkshire Hathaway, which will also receive warrants to purchase $5 billion of common stock with a strike price of $115 per share. Berkshire has five years to exercise the warrants.
Asian markets were mostly in the green today, 24 September 2008. Key benchmark indices in Hong Kong, Singapore, Taiwan and South Korea were up by between 0.26% to 1.3%. Key benchmark indices in Japan and China were down by between 0.9% to 2.2%.
US stocks fell on Tuesday, 23 September 2008, on fear that congressional wrangling could delay a proposed $700 billion plan to rescue the financial sector, increasing worries about the struggling US economy. The Dow Jones industrial average fell 161.52 points, or 1.47%, to end at 10,854.17. The Standard & Poor's 500 Index slid 18.87 points, or 1.56%, to 1,188.22. The Nasdaq Composite Index dropped 25.64 points, or 1.18%, to 2,153.34.
Meanwhile, a US-India civilian nuclear cooperation agreement moved closer to approval by Congress on Tuesday, 23 September 2008, when a key Senate Committee passed the deal with a landslide majority. However, the historic agreement is yet to clear a few hurdles in its final lap. The bill now goes to the floor of the Senate for the final ratification.
As per the provisional data released by the stock exchanges, foreign funds on Tuesday, 23 September 2008, sold shares worth a net Rs 924.40 crore. Domestic fund bought shares worth a net Rs 68.77 crore.
The September 2008 contracts expire on Thursday, 25 September 2008. Roll over in Nifty futures till Tuesday, 23 September 2008, was about 40%.
Meanwhile, trading on the bourses will be extended to 16:15 IST starting today due to Sun Outage. Trading will start as usual at 9:55 IST and close at 16:15 IST. On BSE, there will be no trading from 11:25 IST to 12:10 IST as there will be signal problems during this time.
Asian markets were mostly in the green today, 24 September 2008. Key benchmark indices in Hong Kong, Singapore, Taiwan and South Korea were up by between 0.26% to 1.3%. Key benchmark indices in Japan and China were down by between 0.9% to 2.2%.
US stocks fell on Tuesday, 23 September 2008, on fear that congressional wrangling could delay a proposed $700 billion plan to rescue the financial sector, increasing worries about the struggling US economy. The Dow Jones industrial average fell 161.52 points, or 1.47%, to end at 10,854.17. The Standard & Poor's 500 Index slid 18.87 points, or 1.56%, to 1,188.22. The Nasdaq Composite Index dropped 25.64 points, or 1.18%, to 2,153.34.
Meanwhile, a US-India civilian nuclear cooperation agreement moved closer to approval by Congress on Tuesday, 23 September 2008, when a key Senate Committee passed the deal with a landslide majority. However, the historic agreement is yet to clear a few hurdles in its final lap. The bill now goes to the floor of the Senate for the final ratification.
As per the provisional data released by the stock exchanges, foreign funds on Tuesday, 23 September 2008, sold shares worth a net Rs 924.40 crore. Domestic fund bought shares worth a net Rs 68.77 crore.
The September 2008 contracts expire on Thursday, 25 September 2008. Roll over in Nifty futures till Tuesday, 23 September 2008, was about 40%.
Meanwhile, trading on the bourses will be extended to 16:15 IST starting today due to Sun Outage. Trading will start as usual at 9:55 IST and close at 16:15 IST. On BSE, there will be no trading from 11:25 IST to 12:10 IST as there will be signal problems during this time.
sun outage - Change in trading time
The BSE and NSE will extend trading hours from 24 September 2008 on
account of disruption of satellite services due to sun outage.
Trading will start as usual at 9.55 IST, but will be suspended
between 11.25 IST and 12.10 IST. The day's session will end at
16.15 IST. The new trading timing will be effective till 8 October
2008.
account of disruption of satellite services due to sun outage.
Trading will start as usual at 9.55 IST, but will be suspended
between 11.25 IST and 12.10 IST. The day's session will end at
16.15 IST. The new trading timing will be effective till 8 October
2008.
Are Indian firms the riskiest bets?
Investors’ risk perception of Indian companies has worsened, threatening to raise their borrowing costs, even as the government eases access to overseas funds for infrastructure firms.
Widening spreads in the market for credit default swaps, or CDS, show the deteriorating perception about the ability of Indian entities to repay debt.
A CDS is a financial instrument based on corporate bonds and loans used to speculate on the borrower’s ability to pay back debt and hedge against defaults. Under a CDS contract, a debt holder makes periodic payments to an entity that agrees to take the hit in the event of a default by the borrower.
Spreads on the CDS of Tata Motors Ltd, India’s biggest automobile producer and the worst affected among all Indian firms, widened by 557.7 basis points since the start of 2008 to 760 basis points as of 19 September, according to Bloomberg data. One basis point is one-hundredth of a percentage point.
During the same period, spreads on the CDS of ICICI Bank Ltd, the country’s second biggest bank, have risen by 204.6 basis points to 381.7 basis points and that on Reliance Communications Ltd, the second largest mobile phone firm, by 357.5 points to 570 basis points.
The other Indian firms in the CDS market—Bank of India, Exim Bank, IDBI Bank Ltd and Reliance Industries Ltd—are relatively less affected.
CDS is the most popular form of a credit derivative, with an estimated market size of $62 trillion, three times the size of the US equities market. Credit spreads are the difference in interest rates between government bonds or treasury securities and corporate bonds. Companies usually offer a higher return than governments because they do not have sovereign backing.
“The widening of spread indicates higher risk perception,” said Naresh Takkar, managing director of rating agency Icra Ltd. “But this is not unique to India. All companies in the world have been affected by the global crisis and the spreads have widened.”
That may be true, but in relative terms Indian firms seem to have been hit harder. Spreads on CDS from the other so-called Bric (Brazil, Russia, India and China) economies have not widened as much as those of Indian firms even though some of them, particularly Brazilian and Russian, have similar credit ratings.
The only exception is Bank of Moscow, which has seen the spreads over its CDS widening by 429.9 basis points to 787.5 points since January.
Spreads on CDS of borrowers from other countries such as Hong Kong, Indonesia, Malaysia, the Philippines and Singapore have also been less affected.
“The spreads on CDS indicate outlook on the future performance of a company and a possible indication on ratings,” said J. Moses Harding, executive vice-president and head (wholesale banking group), IndusInd Bank Ltd.
India is perceived as a riskier play than its Asian peers for overseas investors, although the country has been relatively insulated from the extraordinary global financial turmoil that has claimed some famed Wall Street banks as victims and forced the US to propose a $700 billion relief package.
“This is not very surprising as India’s sovereign rating is currently in the low investment grade category,” said Rajesh Mokashi, executive director of Credit Analysis and Research Ltd.
According to him, the situation does not reflect the fundamentals of the Indian companies and one should not read too much into it.
“The high level of panic in these markets has skewed the pricing of such CDS. When the situation settles down and people get a better understanding of the fact that the probability of default by Indian companies is extremely low, the spreads will narrow,” he said.
India on Monday relaxed the norms for external commercial borrowings, or ECBs, by infrastructure firms and allowed them to raise five times more money—or $500 million— than what they were earlier allowed.
It also allowed firms to sell seven-year paper at a spread of 450 basis points over the London interbank offered rate, or Libor, an international benchmark. That’s an increase of 100 basis points from what they were allowed to pay earlier.
That may encourage Indian firms to tap the overseas market for funds, but they will have to pay more because of the growing risk perception.
“Given the current global market conditions, we do not expect a surge in flows,” said Rohini Malkani, economist at Citigroup Inc.’s Indian unit, in her latest research report.
source: mint
Widening spreads in the market for credit default swaps, or CDS, show the deteriorating perception about the ability of Indian entities to repay debt.
A CDS is a financial instrument based on corporate bonds and loans used to speculate on the borrower’s ability to pay back debt and hedge against defaults. Under a CDS contract, a debt holder makes periodic payments to an entity that agrees to take the hit in the event of a default by the borrower.
Spreads on the CDS of Tata Motors Ltd, India’s biggest automobile producer and the worst affected among all Indian firms, widened by 557.7 basis points since the start of 2008 to 760 basis points as of 19 September, according to Bloomberg data. One basis point is one-hundredth of a percentage point.
During the same period, spreads on the CDS of ICICI Bank Ltd, the country’s second biggest bank, have risen by 204.6 basis points to 381.7 basis points and that on Reliance Communications Ltd, the second largest mobile phone firm, by 357.5 points to 570 basis points.
The other Indian firms in the CDS market—Bank of India, Exim Bank, IDBI Bank Ltd and Reliance Industries Ltd—are relatively less affected.
CDS is the most popular form of a credit derivative, with an estimated market size of $62 trillion, three times the size of the US equities market. Credit spreads are the difference in interest rates between government bonds or treasury securities and corporate bonds. Companies usually offer a higher return than governments because they do not have sovereign backing.
“The widening of spread indicates higher risk perception,” said Naresh Takkar, managing director of rating agency Icra Ltd. “But this is not unique to India. All companies in the world have been affected by the global crisis and the spreads have widened.”
That may be true, but in relative terms Indian firms seem to have been hit harder. Spreads on CDS from the other so-called Bric (Brazil, Russia, India and China) economies have not widened as much as those of Indian firms even though some of them, particularly Brazilian and Russian, have similar credit ratings.
The only exception is Bank of Moscow, which has seen the spreads over its CDS widening by 429.9 basis points to 787.5 points since January.
Spreads on CDS of borrowers from other countries such as Hong Kong, Indonesia, Malaysia, the Philippines and Singapore have also been less affected.
“The spreads on CDS indicate outlook on the future performance of a company and a possible indication on ratings,” said J. Moses Harding, executive vice-president and head (wholesale banking group), IndusInd Bank Ltd.
India is perceived as a riskier play than its Asian peers for overseas investors, although the country has been relatively insulated from the extraordinary global financial turmoil that has claimed some famed Wall Street banks as victims and forced the US to propose a $700 billion relief package.
“This is not very surprising as India’s sovereign rating is currently in the low investment grade category,” said Rajesh Mokashi, executive director of Credit Analysis and Research Ltd.
According to him, the situation does not reflect the fundamentals of the Indian companies and one should not read too much into it.
“The high level of panic in these markets has skewed the pricing of such CDS. When the situation settles down and people get a better understanding of the fact that the probability of default by Indian companies is extremely low, the spreads will narrow,” he said.
India on Monday relaxed the norms for external commercial borrowings, or ECBs, by infrastructure firms and allowed them to raise five times more money—or $500 million— than what they were earlier allowed.
It also allowed firms to sell seven-year paper at a spread of 450 basis points over the London interbank offered rate, or Libor, an international benchmark. That’s an increase of 100 basis points from what they were allowed to pay earlier.
That may encourage Indian firms to tap the overseas market for funds, but they will have to pay more because of the growing risk perception.
“Given the current global market conditions, we do not expect a surge in flows,” said Rohini Malkani, economist at Citigroup Inc.’s Indian unit, in her latest research report.
source: mint
After warning, Dollar Thrifty shares plunge more than 30 percent on debt covenant worries
Shares of Dollar Thrifty Automotive Group Inc. plunged more than 30 percent on Tuesday as investors worried about the rental car company's debt covenants following its warning about difficult revenue trends and vehicle depreciation costs.
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The company said its third-quarter results will also be hurt by the bankruptcy of one of its tour operators. A Dollar Thrifty representative declined to provide further comment, but confirmed that the tour operator is U.K.-based XL Leisure Group PLC, which left more than 50,000 customers stranded abroad when it went into liquidation earlier this month.
Dollar Thrifty shares dropped $1.54, or 33.8 percent, to end at $3.01. The stock has lost about 90 percent of its value over the past 52 weeks, bottoming at a low of $2.31 in mid-July.
In a note to investors, Goldman Sachs analyst Christopher Agnew said the company seems likely to threaten some of its financial covenants by the end of the year. He said it appears that losses on Chrysler vehicles continue to be higher than Dollar Thrifty's management had previously estimated.
He also noted that Florida and California were two popular destinations for XL Travel and are also key markets for Dollar Thrifty.
Agnew has a "Neutral" rating on the stock.
In its statement early Tuesday, Dollar Thrifty said is seeking an amendment to the allowed leverage under its senior secured credit facility. If that fails, the company plans to use some excess liquidity to repay a portion of its term debt to maintain covenant compliance.
The Tulsa, Okla.-based company has more than 800 locations in the U.S. and Canada under the brands Dollar Rent A Car and Thrifty Car Rental.
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The company said its third-quarter results will also be hurt by the bankruptcy of one of its tour operators. A Dollar Thrifty representative declined to provide further comment, but confirmed that the tour operator is U.K.-based XL Leisure Group PLC, which left more than 50,000 customers stranded abroad when it went into liquidation earlier this month.
Dollar Thrifty shares dropped $1.54, or 33.8 percent, to end at $3.01. The stock has lost about 90 percent of its value over the past 52 weeks, bottoming at a low of $2.31 in mid-July.
In a note to investors, Goldman Sachs analyst Christopher Agnew said the company seems likely to threaten some of its financial covenants by the end of the year. He said it appears that losses on Chrysler vehicles continue to be higher than Dollar Thrifty's management had previously estimated.
He also noted that Florida and California were two popular destinations for XL Travel and are also key markets for Dollar Thrifty.
Agnew has a "Neutral" rating on the stock.
In its statement early Tuesday, Dollar Thrifty said is seeking an amendment to the allowed leverage under its senior secured credit facility. If that fails, the company plans to use some excess liquidity to repay a portion of its term debt to maintain covenant compliance.
The Tulsa, Okla.-based company has more than 800 locations in the U.S. and Canada under the brands Dollar Rent A Car and Thrifty Car Rental.
US Stocks extend fall as Street weighs bailout plan
NEW YORK (AP) -- Financial markets extended their declines Tuesday as investors worried that lawmakers were beginning to doubt the necessity of a broad government bailout for financial institutions as a way to revive ailing credit markets.
Top economic officials updating Congress about efforts to work out a $700 billion financial rescue plan faced a greater degree of second-guessing from lawmakers than some investors had expected. The Dow Jones industrials, which had been higher for the first half of the session ended at the lows of the day, tacking a 161-point loss onto a steep drop from Monday.
Still, trading appeared more orderly than Monday, when investors rushed into hard assets like oil and gold. Meanwhile, demand remained high for 3-month Treasury bills, considered the safest short-term financial asset, while the dollar regained some ground after being hard hit Monday.
After days of intense gyrations in financial markets, investors are anxious about whether the plan to absorb bad mortgages and other risky assets will help steer the economy onto more solid footing -- and also about resistance to the plan in Congress.
Treasury Secretary Henry Paulson, Federal Reserve Chairman Ben Bernanke and Securities and Exchange Commission Chairman Christopher Cox testified before lawmakers, who are working alongside others in the Bush administration to complete the details of the bailout.
Traders grew nervous, and sent the stock market lower, as the officials faced questions about whether the government's planned response was appropriate. Sen. Chuck Schumer, D-N.Y., for example, asked whether $150 billion might be adequate to get the program started if investors were told more money could be added if necessary.
The market remains uncertain about how long it will take for the bailout plans to take effect, and assuming they do, how effective they will be.
"There's skepticism about whether the $700 billion number is the right number," said Jim Herrick, manager and director of equity trading at Baird & Co.
Bernanke told the Senate Banking Committee Congress risks triggering a recession if it doesn't act on the plan. He said inaction could leave a range of businesses unable to borrow the money while consumers could find it impossible to finance big purchases like cars and homes.
While financial markets showed uneasiness as investors listened to the testimony, there wasn't the level of fear and volatility that dominated Monday's trading.
Demand for short-term Treasurys remained high. The yield on the 3-month T-bill fell to 0.79 percent from 0.88 percent on Monday; last week, it was around zero after investors flooded money into T-bills as the credit markets seized up. That spurred government officials to propose a debt buyout plan.
The yield on the benchmark 10-year Treasury note, which trades opposite its price, fell to 3.80 percent from 3.85 percent late Monday.
The dollar, whose decline Monday drove some of the frenetic trading in other markets, regained some of its lost ground against the euro, while gold prices declined after starting the week with a big advance.
The Dow fell 161.52, or 1.47 percent, to 10,854.17 after having risen more than 125 points in the early going and then falling by more than 180. With Monday's 370-point decline, the blue chips are down 534 points, or 4.69 percent, for the week.
Broader stock indicators also fell Tuesday. The Standard & Poor's 500 index fell 18.87, or 1.56 percent, to 1,188.22, and the Nasdaq composite index fell 25.67, or 1.18 percent, to 2,153.34.
Investors also were watching oil prices after anxiety over the government bailout and a huge short-covering rally pushed crude to the biggest one-day gain.
Light, sweet crude for November delivery fell $2.76 to settle at $106.61 on the New York Mercantile Exchange. The October contract, which expired Monday, surged as much as $25.45 to $130 before falling back to settle at $120.92, an advance of $16.37. While that gain was due to technical market dynamics, the price of oil has moved higher over the past week amid increasing concerns about the U.S. financial system.
"We're going to see this volatility for a while even after this package passes because I think we're still facing a fundamental slowdown in the economy worldwide which is going to have some impact on earnings," said J. Stephen Lauck, chief executive and portfolio manager at Ashfield Capital Partners.
Financial stocks finished mixed as some investors worried that the government's plan could prove inadequate to save some banks. Should the government pay too little for assets some banks might be forced to book ruinous write-offs and risk going under.
Bank of America Corp. fell 85 cents, or 2.5 percent, to $33.30, while Washington Mutual Inc. fell 13 cents, or 3.9 percent, to $3.20.
Some energy names lost ground as oil declined. Occidental Petroleum Corp. fell $4.08, or 5 percent, to $77.16 and XTO Energy Inc. declined $1.14, or 2.2 percent, to $51.30.
In addition, some industrial stocks slid as investors worried about the well-being of the global economy. Aluminum maker Alcoa Inc. fell $1.21, or 4.5 percent, to $25.59. Seed company Monsanto Co. fell $4.85, or 4.2 percent, to $112.14.
Some technology stocks advanced as investors looked for areas outside the financial, energy and industrial sectors. Computer chip maker Intel Corp. rose 13 cents to $18.63, while Sprint Nextel Corp. rose 27 cents, or 4.2 percent, to $6.77.
Declining issues outnumbered advancers by about 5 to 2 on the New York Stock Exchange, where consolidated volume came to 5.11 billion shares, compared with 5.22 billion traded Monday.
The Russell 2000 index of smaller companies fell 11.25, or 1.56 percent, to 709.19.
Overseas, Britain's FTSE 100 fell 1.91 percent, Germany's DAX index slid 0.64 percent, and France's CAC-40 fell 1.98 percent. Japanese financial markets were closed Tuesday for a national holiday.
Top economic officials updating Congress about efforts to work out a $700 billion financial rescue plan faced a greater degree of second-guessing from lawmakers than some investors had expected. The Dow Jones industrials, which had been higher for the first half of the session ended at the lows of the day, tacking a 161-point loss onto a steep drop from Monday.
Still, trading appeared more orderly than Monday, when investors rushed into hard assets like oil and gold. Meanwhile, demand remained high for 3-month Treasury bills, considered the safest short-term financial asset, while the dollar regained some ground after being hard hit Monday.
After days of intense gyrations in financial markets, investors are anxious about whether the plan to absorb bad mortgages and other risky assets will help steer the economy onto more solid footing -- and also about resistance to the plan in Congress.
Treasury Secretary Henry Paulson, Federal Reserve Chairman Ben Bernanke and Securities and Exchange Commission Chairman Christopher Cox testified before lawmakers, who are working alongside others in the Bush administration to complete the details of the bailout.
Traders grew nervous, and sent the stock market lower, as the officials faced questions about whether the government's planned response was appropriate. Sen. Chuck Schumer, D-N.Y., for example, asked whether $150 billion might be adequate to get the program started if investors were told more money could be added if necessary.
The market remains uncertain about how long it will take for the bailout plans to take effect, and assuming they do, how effective they will be.
"There's skepticism about whether the $700 billion number is the right number," said Jim Herrick, manager and director of equity trading at Baird & Co.
Bernanke told the Senate Banking Committee Congress risks triggering a recession if it doesn't act on the plan. He said inaction could leave a range of businesses unable to borrow the money while consumers could find it impossible to finance big purchases like cars and homes.
While financial markets showed uneasiness as investors listened to the testimony, there wasn't the level of fear and volatility that dominated Monday's trading.
Demand for short-term Treasurys remained high. The yield on the 3-month T-bill fell to 0.79 percent from 0.88 percent on Monday; last week, it was around zero after investors flooded money into T-bills as the credit markets seized up. That spurred government officials to propose a debt buyout plan.
The yield on the benchmark 10-year Treasury note, which trades opposite its price, fell to 3.80 percent from 3.85 percent late Monday.
The dollar, whose decline Monday drove some of the frenetic trading in other markets, regained some of its lost ground against the euro, while gold prices declined after starting the week with a big advance.
The Dow fell 161.52, or 1.47 percent, to 10,854.17 after having risen more than 125 points in the early going and then falling by more than 180. With Monday's 370-point decline, the blue chips are down 534 points, or 4.69 percent, for the week.
Broader stock indicators also fell Tuesday. The Standard & Poor's 500 index fell 18.87, or 1.56 percent, to 1,188.22, and the Nasdaq composite index fell 25.67, or 1.18 percent, to 2,153.34.
Investors also were watching oil prices after anxiety over the government bailout and a huge short-covering rally pushed crude to the biggest one-day gain.
Light, sweet crude for November delivery fell $2.76 to settle at $106.61 on the New York Mercantile Exchange. The October contract, which expired Monday, surged as much as $25.45 to $130 before falling back to settle at $120.92, an advance of $16.37. While that gain was due to technical market dynamics, the price of oil has moved higher over the past week amid increasing concerns about the U.S. financial system.
"We're going to see this volatility for a while even after this package passes because I think we're still facing a fundamental slowdown in the economy worldwide which is going to have some impact on earnings," said J. Stephen Lauck, chief executive and portfolio manager at Ashfield Capital Partners.
Financial stocks finished mixed as some investors worried that the government's plan could prove inadequate to save some banks. Should the government pay too little for assets some banks might be forced to book ruinous write-offs and risk going under.
Bank of America Corp. fell 85 cents, or 2.5 percent, to $33.30, while Washington Mutual Inc. fell 13 cents, or 3.9 percent, to $3.20.
Some energy names lost ground as oil declined. Occidental Petroleum Corp. fell $4.08, or 5 percent, to $77.16 and XTO Energy Inc. declined $1.14, or 2.2 percent, to $51.30.
In addition, some industrial stocks slid as investors worried about the well-being of the global economy. Aluminum maker Alcoa Inc. fell $1.21, or 4.5 percent, to $25.59. Seed company Monsanto Co. fell $4.85, or 4.2 percent, to $112.14.
Some technology stocks advanced as investors looked for areas outside the financial, energy and industrial sectors. Computer chip maker Intel Corp. rose 13 cents to $18.63, while Sprint Nextel Corp. rose 27 cents, or 4.2 percent, to $6.77.
Declining issues outnumbered advancers by about 5 to 2 on the New York Stock Exchange, where consolidated volume came to 5.11 billion shares, compared with 5.22 billion traded Monday.
The Russell 2000 index of smaller companies fell 11.25, or 1.56 percent, to 709.19.
Overseas, Britain's FTSE 100 fell 1.91 percent, Germany's DAX index slid 0.64 percent, and France's CAC-40 fell 1.98 percent. Japanese financial markets were closed Tuesday for a national holiday.
Berkshire buying $5 billion stake in Goldman Sachs
OMAHA, Neb. (AP) -- Warren Buffett's Berkshire Hathaway Inc. is investing at least $5 billion in Goldman Sachs, a huge vote of confidence for one of the survivors of the credit crisis that felled two of its investment banking peers.
In addition to buying $5 billion in preferred stock, Berkshire also got warrants to buy another $5 billion in Goldman's common stock. Goldman also said late Tuesday it would raise another $2.5 billion in its own public stock offering.
The news sent shares of Goldman Sachs and stock index futures soaring in electronic trading, after the Dow Jones Industrial Average posted a triple-digit decline for the second day in a row.
It also could lead to new probing questions from lawmakers for Treasury Secretary Hank Paulson, a former co-CEO of Goldman Sachs. He and Federal Reserve Chairman Ben Bernanke told Congress hours earlier that quick action on a $700 billion bailout measure for financial services firms was needed to prevent economic havoc.
Goldman Sachs' shares had been tumbling ahead of the announcement of the government rescue plan last Friday as investors feared it could face the same kinds of funding squeezes as Bear Stearns and Lehman. Now members of Congress have to deal what may look to many taxpayers like Wall Street is already cashing in.
Buffett, one of the most successful investors in history, made no mention of what is happening in Washington, but he did heap praise on the New York-based company.
"Goldman Sachs is an exceptional institution," the chairman and CEO of Berkshire Hathaway said in a news release. "It has an unrivaled global franchise, a proven and deep management team and the intellectual and financial capital to continue its track record of outperformance."
Buffett's investment comes two days after Goldman Sachs Group Inc. and Morgan Stanley, the last two independent investment banks on Wall Street, won approval from the Federal Reserve to change their status to bank holding companies.
By becoming commercial banks, the two companies avoided the fate of Bear Stearns and Lehman Brothers -- the first taken over in a fire sale and the second now bankrupt -- by giving them broader access to borrow federal money and the ability to build a stable base of deposits.
But it also comes with closer regulatory oversight that likely limit its ability to generate the kinds of sky high profits that were topped by few others companies.
The strict rules set by the Federal Reserve will limit opportunities for big payoffs from what is known as proprietary trading, using borrowed funds to place high-octane bets on everything from the price of oil to currencies and other commodities.
Berkshire's preferred stock in Goldman will pay 10 percent and can be bought back any time at 10 percent premium. The warrants allow Berkshire to buy $5 billion in common stock at $115 per share any time over the next five years.
Goldman's shares rose $4.27, or 3.5 percent, to close at $125.05 Tuesday in the regular trading session, and jumped another $8.46, or 6.8 percent, to $133.20 in after-hours trading following the announcement of Buffett's investment.
Morgan Stanley's shares rose 91 cents, or 3.4 percent, to $28 in the regular session, then soared $3, or 10.7 percent, to $31 in after-hours trading.
Morgan Stanley got its own cash infusion on Monday, agreeing to sell a 20 percent stake for more than $8 billion to Mitsubishi UFJ Financial Group Inc., Japan's largest bank.
Mark Lane, an analyst who follows Goldman for William Blair & Co. in Chicago, said he had expected Goldman and Morgan Stanley to raise capital after getting the Fed's approval to become bank holding companies.
Buffett's investment "sends a pretty strong message of support for the independent-bank business model," Lane said. "It sends a stabilizing signal to the market."
On Sept. 14, the No. 4 investment bank, Lehman Brothers, filed for the largest bankruptcy in U.S. history, weighed down by fouled commercial real estate holdings and a loss of faith from investors, and on the same day ailing Merrill Lynch & Co. arranged a hasty deal to be bought by Bank of America Corp.
Wall Street's troubles came as a freeze-up in credit markets threatened to clog the global financial system. The U.S. government arranged an $85 billion loan last week to rescue the huge insurer American International Group Inc. and is seeking approval from Congress to buy back some $700 billion in bad mortgages and other toxic debts from financial institutions.
A message left for a Berkshire spokeswoman seeking further comment on the transaction wasn't immediately returned Tuesday. Berkshire officials do not typically comment on its stock investments beyond what they are legally required to disclose.
A spokeswoman at Goldman Sachs said no one was immediately available to talk about the deal.
At last report, Berkshire had total assets of nearly $278 billion, including significant stakes in companies such as Wells Fargo & Co., American Express and the Washington Post Co.
In addition to buying $5 billion in preferred stock, Berkshire also got warrants to buy another $5 billion in Goldman's common stock. Goldman also said late Tuesday it would raise another $2.5 billion in its own public stock offering.
The news sent shares of Goldman Sachs and stock index futures soaring in electronic trading, after the Dow Jones Industrial Average posted a triple-digit decline for the second day in a row.
It also could lead to new probing questions from lawmakers for Treasury Secretary Hank Paulson, a former co-CEO of Goldman Sachs. He and Federal Reserve Chairman Ben Bernanke told Congress hours earlier that quick action on a $700 billion bailout measure for financial services firms was needed to prevent economic havoc.
Goldman Sachs' shares had been tumbling ahead of the announcement of the government rescue plan last Friday as investors feared it could face the same kinds of funding squeezes as Bear Stearns and Lehman. Now members of Congress have to deal what may look to many taxpayers like Wall Street is already cashing in.
Buffett, one of the most successful investors in history, made no mention of what is happening in Washington, but he did heap praise on the New York-based company.
"Goldman Sachs is an exceptional institution," the chairman and CEO of Berkshire Hathaway said in a news release. "It has an unrivaled global franchise, a proven and deep management team and the intellectual and financial capital to continue its track record of outperformance."
Buffett's investment comes two days after Goldman Sachs Group Inc. and Morgan Stanley, the last two independent investment banks on Wall Street, won approval from the Federal Reserve to change their status to bank holding companies.
By becoming commercial banks, the two companies avoided the fate of Bear Stearns and Lehman Brothers -- the first taken over in a fire sale and the second now bankrupt -- by giving them broader access to borrow federal money and the ability to build a stable base of deposits.
But it also comes with closer regulatory oversight that likely limit its ability to generate the kinds of sky high profits that were topped by few others companies.
The strict rules set by the Federal Reserve will limit opportunities for big payoffs from what is known as proprietary trading, using borrowed funds to place high-octane bets on everything from the price of oil to currencies and other commodities.
Berkshire's preferred stock in Goldman will pay 10 percent and can be bought back any time at 10 percent premium. The warrants allow Berkshire to buy $5 billion in common stock at $115 per share any time over the next five years.
Goldman's shares rose $4.27, or 3.5 percent, to close at $125.05 Tuesday in the regular trading session, and jumped another $8.46, or 6.8 percent, to $133.20 in after-hours trading following the announcement of Buffett's investment.
Morgan Stanley's shares rose 91 cents, or 3.4 percent, to $28 in the regular session, then soared $3, or 10.7 percent, to $31 in after-hours trading.
Morgan Stanley got its own cash infusion on Monday, agreeing to sell a 20 percent stake for more than $8 billion to Mitsubishi UFJ Financial Group Inc., Japan's largest bank.
Mark Lane, an analyst who follows Goldman for William Blair & Co. in Chicago, said he had expected Goldman and Morgan Stanley to raise capital after getting the Fed's approval to become bank holding companies.
Buffett's investment "sends a pretty strong message of support for the independent-bank business model," Lane said. "It sends a stabilizing signal to the market."
On Sept. 14, the No. 4 investment bank, Lehman Brothers, filed for the largest bankruptcy in U.S. history, weighed down by fouled commercial real estate holdings and a loss of faith from investors, and on the same day ailing Merrill Lynch & Co. arranged a hasty deal to be bought by Bank of America Corp.
Wall Street's troubles came as a freeze-up in credit markets threatened to clog the global financial system. The U.S. government arranged an $85 billion loan last week to rescue the huge insurer American International Group Inc. and is seeking approval from Congress to buy back some $700 billion in bad mortgages and other toxic debts from financial institutions.
A message left for a Berkshire spokeswoman seeking further comment on the transaction wasn't immediately returned Tuesday. Berkshire officials do not typically comment on its stock investments beyond what they are legally required to disclose.
A spokeswoman at Goldman Sachs said no one was immediately available to talk about the deal.
At last report, Berkshire had total assets of nearly $278 billion, including significant stakes in companies such as Wells Fargo & Co., American Express and the Washington Post Co.
tips for 24th Sep 2008
Sell BANKINDIA Below @ 281 Target 278-271 to 259.
Sell CMC Below @ 494 Target 490-483 to 469.
Sell GAMBUJA Below @ 83 Target 82-81 to 78.
Sell HIDALCO Below @ 107 Target 106-104 to 99.
Sell CMC Below @ 494 Target 490-483 to 469.
Sell GAMBUJA Below @ 83 Target 82-81 to 78.
Sell HIDALCO Below @ 107 Target 106-104 to 99.
Tuesday, September 23, 2008
Ranbaxy tanks over 11%
Key benchmark indices suffered sharp losses mirroring its global
peers on uncertainty about the potency of the US government's $700
billion bank bailout. High volatility was the hallmark of the day's
trading session. All BSE sectoral indices suffered losses with IT,
realty and banking leading the fall. However state-run oil
marketing firms bucket weak market trend. The market breadth was
weak. Ranbaxy Labs slumped over 11%.
European markets were trading lower. Key indices in UK, France and
Germany were down 1.06% to 2.69%. Asian markets, which opened
before Indian markets, were mixed. Key indices in China, Hong Kong
and Singapore were down by 1.56% to 3.87%. However, key indices in
Taiwan and South Korea were up by 1.17% to 1.44%. Japanese
financial markets were closed today for Autumnal Equinox Day, a
national holiday.
The BSE 30-share Sensex was down 424.65 points or 3.03% to
13,570.31. The index shed 451.49 points at the day's low of
13,543.47, hit in fag end of the session. The Sensex fell 16.7
points at day's high of 13,978.26, hit in mid-morning.
The S&P CNX Nifty was down 96.15 points or 2.28% to 4,126.90. Nifty
September 2008 futures were at 4135, at a premium of 8.1 points as
compared to spot closing.
The BSE Mid-Cap index was down 2.06% at 5,113.31 and the BSE
Small-Cap index was down 1.63% at 6,092.97.
The market breadth was weak on BSE with 760 shares advancing as
compared to 1823 that declined. 69 shares remained unchanged.
BSE clocked a turnover of Rs 4322 crore compared with Rs 4,886.79
on Monday, 22 September 2008. NSE's futures & options (F&O) segment
turnover was Rs 68368.66 crore, which was higher than Rs 58188.03
crore on Friday, 19 September 2008.
India's largest drug maker by sales Ranbaxy Laboratories declined
11.05% at Rs 308.85 on reports the Canadian drug regulator, Health
Canada, issued a notice to Ranbaxy saying it will be particularly
cautious about drug marketing applications from Ranbaxy after the
US drug regulator blocked the sale of more than 30 generic
medicines made in two factories by the company. The stock had
declined 2.70% in the previous session.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) declined 1.35% at Rs 2009.70.
The stock came off session's high of Rs 2,096. Reliance Industries
(RIL) began production of crude oil at KG-D6 block of the Krishna
Godavari basin on 17 September 2008, the company said on 22
September 2008. RIL holds 90% participating interest in the block
while the balance is being held by Niko Resources.
India's largest aluminium producer Hindalco Industries fell 1.59%
at 108.10 after hitting a 52-week low of Rs 106.20 on BSE. The
company's Rs 5,050 crore rights share offering for subscription
Monday, 22 September 2008. The sale in a ratio of three shares for
every seven held at Rs 96 a share will close on 10 October 2008.
The company aims to use the funds to repay a bridge loan it had
taken to buy Canada's Novelis in 2007.
Software shares tumbled on growing worries about outsourcing
prospects amid a global financial turmoil. Satyam Computer (down
5.98% at Rs 331.65), TCS (down 5.91% at Rs 720.75), Wipro (down
5.77% at Rs 390.45), and Infosys Technologies (down 5.19% at Rs
1,543.35), slipped. The BSE IT index underperformed the Sensex,
falling 5.07% at 3,455.05. Export-driven Indian software firms earn
more than half of their revenue in dollar terms.
Realty shares extended previous session's fall. Indiabulls Real
Estate (down 6.93% at Rs 209.50), Housing Development &
Infrastructure (down 5.97% at Rs 209.60), and Unitech (down 3.66%
at Rs 123.80), slumped. The BSE Realty index underperformed the
Sensex, falling 4.68% to 3,903.82.
India's largest real estate developer by market capitalisation DLF
fell 6.25% at Rs 394.60. As per recent reports, the company is
retrenching around 300 employees across all its centres and
subsidiaries as it decides to slow down its project execution,
especially in Tier II cities, in the face of shrinking demand and
expensive borrowing.
Banking shares were hard hit on fears local banks may reportedly
suffer losses on their exposure to the US financial giants that
collapsed recently. ICICI Bank (down 5.48% at Rs 599.70), HDFC Bank
(down 4.62% at Rs 1237.70), and and State Bank of India (down 4.08%
at Rs 1502.75), dipped. The BSE Bankex underperformed the Sensex,
falling 4.19% to 6,804.42.
As per reports, nine of the country's largest commercial banks
including State Bank of India (SBI), ICICI Bank and HDFC Bank
reportedly have exposure of $420 million (Rs 2,000 crore) in the US
financial giants. As per the government, banks other than SBI would
suffer losses of Rs 600 crore due to the crisis. SBI alone has
exposure of $170 million in Freddie Mac and Fannie Mae. The public
sector giant's exposure in Lehman Brothers is estimated at $17
million.
The estimated losses are due to their ownership of securities sold
by Fannie Mae, Freddie Mac, Merrill Lynch & Co., and Lehman
Brothers Holding Inc, which have declined in value leading to
marked-to-market losses, the report said.
Shares of three state-run oil marketing firms rose after crude oil
for November 2008 delivery fell $3.30 to $106.07 a barrel in
electronic trading today, 23 September 2008. BPCL (up 2.51% at Rs
345.55), Indian Oil Corporation (up 1.62% at Rs 388.60), and HPCL
(up 1.24% at Rs 233.45), rose.
Reliance Industries clocked a highest turnover of Rs 396.30 crore
on BSE. Reliance Capital (Rs 277.86 crore), Sesa Goa (Rs 239.39
crore), State bank of India (Rs 136.38 crore), and Reliance Natural
Resources (Rs 135.41 crore), were the other turnover toppers on BSE
in that order.
Sesa Goa reported a highest volume of 1.86 crore shares on BSE.
Reliance Natural Resources (1.67 crore shares), Apollo Tyre (74.32
lakh shares), IFCI (67.07 lakh shares), and Cals Refineries (62.66
lakh shares), were the other volume toppers on BSE in that order.
The barometer index is down 6716.68 points or 33.10% in the
calendar year 2008 so far from its close of 20,286.99 on 31
December 2007. It is 7636.46 points or 36% below its all-time high
of 21,206.77 struck on 10 January 2008.
Diversified firm Karuturi Global rose 1.98% to Rs 20.65 on reports
the company plans to raise $100 million by selling 15% stake in its
Dubai based subsidiary to an undisclosed private equity firm.
Steel roll maker Tayo Rolls fell 3.59% to Rs 135.80 after the
company scheduled a board meet on 26 September 2008 to price and
fix swap ratio for its Rs 60.34 crore rights issue. The stock came
off session's high of Rs 148.50 hit in early trade.
Construction firm Nagarjuna Construction Company lost 3.78% to Rs
112 even as the company secured four orders aggregating Rs 413
crore.
peers on uncertainty about the potency of the US government's $700
billion bank bailout. High volatility was the hallmark of the day's
trading session. All BSE sectoral indices suffered losses with IT,
realty and banking leading the fall. However state-run oil
marketing firms bucket weak market trend. The market breadth was
weak. Ranbaxy Labs slumped over 11%.
European markets were trading lower. Key indices in UK, France and
Germany were down 1.06% to 2.69%. Asian markets, which opened
before Indian markets, were mixed. Key indices in China, Hong Kong
and Singapore were down by 1.56% to 3.87%. However, key indices in
Taiwan and South Korea were up by 1.17% to 1.44%. Japanese
financial markets were closed today for Autumnal Equinox Day, a
national holiday.
The BSE 30-share Sensex was down 424.65 points or 3.03% to
13,570.31. The index shed 451.49 points at the day's low of
13,543.47, hit in fag end of the session. The Sensex fell 16.7
points at day's high of 13,978.26, hit in mid-morning.
The S&P CNX Nifty was down 96.15 points or 2.28% to 4,126.90. Nifty
September 2008 futures were at 4135, at a premium of 8.1 points as
compared to spot closing.
The BSE Mid-Cap index was down 2.06% at 5,113.31 and the BSE
Small-Cap index was down 1.63% at 6,092.97.
The market breadth was weak on BSE with 760 shares advancing as
compared to 1823 that declined. 69 shares remained unchanged.
BSE clocked a turnover of Rs 4322 crore compared with Rs 4,886.79
on Monday, 22 September 2008. NSE's futures & options (F&O) segment
turnover was Rs 68368.66 crore, which was higher than Rs 58188.03
crore on Friday, 19 September 2008.
India's largest drug maker by sales Ranbaxy Laboratories declined
11.05% at Rs 308.85 on reports the Canadian drug regulator, Health
Canada, issued a notice to Ranbaxy saying it will be particularly
cautious about drug marketing applications from Ranbaxy after the
US drug regulator blocked the sale of more than 30 generic
medicines made in two factories by the company. The stock had
declined 2.70% in the previous session.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) declined 1.35% at Rs 2009.70.
The stock came off session's high of Rs 2,096. Reliance Industries
(RIL) began production of crude oil at KG-D6 block of the Krishna
Godavari basin on 17 September 2008, the company said on 22
September 2008. RIL holds 90% participating interest in the block
while the balance is being held by Niko Resources.
India's largest aluminium producer Hindalco Industries fell 1.59%
at 108.10 after hitting a 52-week low of Rs 106.20 on BSE. The
company's Rs 5,050 crore rights share offering for subscription
Monday, 22 September 2008. The sale in a ratio of three shares for
every seven held at Rs 96 a share will close on 10 October 2008.
The company aims to use the funds to repay a bridge loan it had
taken to buy Canada's Novelis in 2007.
Software shares tumbled on growing worries about outsourcing
prospects amid a global financial turmoil. Satyam Computer (down
5.98% at Rs 331.65), TCS (down 5.91% at Rs 720.75), Wipro (down
5.77% at Rs 390.45), and Infosys Technologies (down 5.19% at Rs
1,543.35), slipped. The BSE IT index underperformed the Sensex,
falling 5.07% at 3,455.05. Export-driven Indian software firms earn
more than half of their revenue in dollar terms.
Realty shares extended previous session's fall. Indiabulls Real
Estate (down 6.93% at Rs 209.50), Housing Development &
Infrastructure (down 5.97% at Rs 209.60), and Unitech (down 3.66%
at Rs 123.80), slumped. The BSE Realty index underperformed the
Sensex, falling 4.68% to 3,903.82.
India's largest real estate developer by market capitalisation DLF
fell 6.25% at Rs 394.60. As per recent reports, the company is
retrenching around 300 employees across all its centres and
subsidiaries as it decides to slow down its project execution,
especially in Tier II cities, in the face of shrinking demand and
expensive borrowing.
Banking shares were hard hit on fears local banks may reportedly
suffer losses on their exposure to the US financial giants that
collapsed recently. ICICI Bank (down 5.48% at Rs 599.70), HDFC Bank
(down 4.62% at Rs 1237.70), and and State Bank of India (down 4.08%
at Rs 1502.75), dipped. The BSE Bankex underperformed the Sensex,
falling 4.19% to 6,804.42.
As per reports, nine of the country's largest commercial banks
including State Bank of India (SBI), ICICI Bank and HDFC Bank
reportedly have exposure of $420 million (Rs 2,000 crore) in the US
financial giants. As per the government, banks other than SBI would
suffer losses of Rs 600 crore due to the crisis. SBI alone has
exposure of $170 million in Freddie Mac and Fannie Mae. The public
sector giant's exposure in Lehman Brothers is estimated at $17
million.
The estimated losses are due to their ownership of securities sold
by Fannie Mae, Freddie Mac, Merrill Lynch & Co., and Lehman
Brothers Holding Inc, which have declined in value leading to
marked-to-market losses, the report said.
Shares of three state-run oil marketing firms rose after crude oil
for November 2008 delivery fell $3.30 to $106.07 a barrel in
electronic trading today, 23 September 2008. BPCL (up 2.51% at Rs
345.55), Indian Oil Corporation (up 1.62% at Rs 388.60), and HPCL
(up 1.24% at Rs 233.45), rose.
Reliance Industries clocked a highest turnover of Rs 396.30 crore
on BSE. Reliance Capital (Rs 277.86 crore), Sesa Goa (Rs 239.39
crore), State bank of India (Rs 136.38 crore), and Reliance Natural
Resources (Rs 135.41 crore), were the other turnover toppers on BSE
in that order.
Sesa Goa reported a highest volume of 1.86 crore shares on BSE.
Reliance Natural Resources (1.67 crore shares), Apollo Tyre (74.32
lakh shares), IFCI (67.07 lakh shares), and Cals Refineries (62.66
lakh shares), were the other volume toppers on BSE in that order.
The barometer index is down 6716.68 points or 33.10% in the
calendar year 2008 so far from its close of 20,286.99 on 31
December 2007. It is 7636.46 points or 36% below its all-time high
of 21,206.77 struck on 10 January 2008.
Diversified firm Karuturi Global rose 1.98% to Rs 20.65 on reports
the company plans to raise $100 million by selling 15% stake in its
Dubai based subsidiary to an undisclosed private equity firm.
Steel roll maker Tayo Rolls fell 3.59% to Rs 135.80 after the
company scheduled a board meet on 26 September 2008 to price and
fix swap ratio for its Rs 60.34 crore rights issue. The stock came
off session's high of Rs 148.50 hit in early trade.
Construction firm Nagarjuna Construction Company lost 3.78% to Rs
112 even as the company secured four orders aggregating Rs 413
crore.
Tata Steel to raise its stake to 42.3% in Riversdale Mining
Tata Steel, which operates in 24 countries and commercial presence in over 50 countries, acquired an additional 7.3% equity stake in Riversdale Mining, a coal blocks in Mozambique, against USD 120.7 million. This increased the stake of Tata steel to 42.3% from 35% which was bought for USD 100 million.
Coal has been in tight supply for the current year since steel market ramped up capacities over the past couple of year and huge demand from China, due to Olympic, and India. While steel capacities start coming on stream, coal mines haven''t kept pace, leading to a tight supply situation. As a result most steelmakers to scout for coal mines overseas, mainly Australia, Indonesia and parts of Africa.
Coal has been in tight supply for the current year since steel market ramped up capacities over the past couple of year and huge demand from China, due to Olympic, and India. While steel capacities start coming on stream, coal mines haven''t kept pace, leading to a tight supply situation. As a result most steelmakers to scout for coal mines overseas, mainly Australia, Indonesia and parts of Africa.
Post Session Market Sep-23-2008
Indian Markets crushed during final hours of trading as huge selling pressure was witnessed across the board on weak global cues. There is an uncertainty on the details regarding the U.S. government’s $700 billion plan to fix the financial market turmoil and the two major Wall Street investment banks Goldman Sachs and Morgan Stanley, converted to a traditional banking structure. Crude oil prices also put fire into the markets as jumped by $16.37 to $120.92 a barrel after touching an intraday high of $130 a barrel, on the New York Mercantile Exchange. Indian markets today opened on downbeat note on the back of weak cues across the globe. Further, markets managed to recover some losses in early trade but were not able to sustain the momentum and slipped further. Huge sell off on the back of profit booking forced markets to land in extremely negative territory. Weak European markets also contributed to the selling pressure. BSE Sensex ended below 13,600 level and NSE Nifty closed below 4,150 mark. From the sectoral front, all of the indices are ended with losses and among those, sharp cut was seen in Bank, Capital Goods, Metal, Reality, IT and Oil & Gas stocks. Mid cap and Small cap stocks also got hammered during the trading session as ended with cut of more than 2% and 1% respectively. The market breadth was negative as 1823 stocks closed in red while 760 stocks closed in green and 69 stocks remained unchanged.
The BSE Sensex closed lower by 424.65 points at 13,570.31 and NSE Nifty ended down by 96.15 points at 4,126.90. The BSE Mid Caps and Small Caps closed with losses of 107.65 points at 5,113.31 and by 101.14 points at 6,092.97. The BSE Sensex touched intraday high of 13,978.26 and intraday low of 13,543.67.
Losers from the BSE are Ranbaxy Lab (11.05%), DLF Ltd (6.25%), Satyam Computer (5.98%), TCS Ltd (5.91%), Wipro Ltd (5.77%), HDFC (5.53%), ICICI Bank Ltd (5.48%), JP Associates (5.38%), Infosys Tech (5.19%), Tata Motors (5.03%) and Tata Steel (4.62%).
The BSE Bank index closed lower by 297.87 points at 6,804.42. Losers are Canara Bank (5.53%), ICICI Bank Ltd (5.48%), HDFC Bank Ltd (4.52%), IDBI Bank Ltd (4.50%), SBI (4.08%) and Kotak Bank (3.79%).
The BSE Capital Goods index lost 258.29 points to close at 11,218.80. Major losers are Everest Kanto (6.78%), Usha Martin (6.08%), Jyoti Struct (4.58%), Crompton Greaves (4.10%), Praj Indus (4.08%) and BHEL (3.43%).
The BSE Metal index plunged 208.40 points to close at 9,924.54. Major losers are Tata Steel (4.62%), Jindal Steel (3.73%), JSW SL (3.63%), Ispat Indus (3.10%), Sterlite In (2.18%) and Welspan Guajrat Sr (2.14%).
The BSE Reality index ended lower 191.68 points to close at 3,903.82. As Indiabull Real (6.93%), DLF Ltd (6.25%), Housing Development (5.97%), Orbit Co (4.17%), Unitech Ltd (3.66%) and Parsvnath (3.24%) closed in negative territory.
The BSE IT index dropped by 184.38 points to close at 3,455.05. As Rolta India (9.61%), Moser Bayer (8.46%), Satyam Computer (5.98%), TCS Ltd (5.91%), Wipro Ltd (5.77%), NIIT Ltd (5.21%) and Infosys Tech (5.19%) closed in negative territory.
The BSE Oil & Gas index ended down by 76.67 points at 8,972.89 as Reliance Nat Res (2.52%), Reliance (1.35%), Aban Offshore (0.91%), Reliance Pet (0.72%), Gail India (0.66%) and Essar Oil Ltd (0.61%) ended in negative territory.
The BSE Sensex closed lower by 424.65 points at 13,570.31 and NSE Nifty ended down by 96.15 points at 4,126.90. The BSE Mid Caps and Small Caps closed with losses of 107.65 points at 5,113.31 and by 101.14 points at 6,092.97. The BSE Sensex touched intraday high of 13,978.26 and intraday low of 13,543.67.
Losers from the BSE are Ranbaxy Lab (11.05%), DLF Ltd (6.25%), Satyam Computer (5.98%), TCS Ltd (5.91%), Wipro Ltd (5.77%), HDFC (5.53%), ICICI Bank Ltd (5.48%), JP Associates (5.38%), Infosys Tech (5.19%), Tata Motors (5.03%) and Tata Steel (4.62%).
The BSE Bank index closed lower by 297.87 points at 6,804.42. Losers are Canara Bank (5.53%), ICICI Bank Ltd (5.48%), HDFC Bank Ltd (4.52%), IDBI Bank Ltd (4.50%), SBI (4.08%) and Kotak Bank (3.79%).
The BSE Capital Goods index lost 258.29 points to close at 11,218.80. Major losers are Everest Kanto (6.78%), Usha Martin (6.08%), Jyoti Struct (4.58%), Crompton Greaves (4.10%), Praj Indus (4.08%) and BHEL (3.43%).
The BSE Metal index plunged 208.40 points to close at 9,924.54. Major losers are Tata Steel (4.62%), Jindal Steel (3.73%), JSW SL (3.63%), Ispat Indus (3.10%), Sterlite In (2.18%) and Welspan Guajrat Sr (2.14%).
The BSE Reality index ended lower 191.68 points to close at 3,903.82. As Indiabull Real (6.93%), DLF Ltd (6.25%), Housing Development (5.97%), Orbit Co (4.17%), Unitech Ltd (3.66%) and Parsvnath (3.24%) closed in negative territory.
The BSE IT index dropped by 184.38 points to close at 3,455.05. As Rolta India (9.61%), Moser Bayer (8.46%), Satyam Computer (5.98%), TCS Ltd (5.91%), Wipro Ltd (5.77%), NIIT Ltd (5.21%) and Infosys Tech (5.19%) closed in negative territory.
The BSE Oil & Gas index ended down by 76.67 points at 8,972.89 as Reliance Nat Res (2.52%), Reliance (1.35%), Aban Offshore (0.91%), Reliance Pet (0.72%), Gail India (0.66%) and Essar Oil Ltd (0.61%) ended in negative territory.
JSW Steel proposed 10 million tons steel plant in Jharkhand
JSW steel, engaged in production and distribution of iron and steel products and generation of power leading it to be third largest steel maker in India, is in the verge to begin the construction of its proposed 10 million tons steel plant in Jharkhand by the coming next year.
As per the company''s disclosures, it has set early 2009 as the target for ground breaking and plant to bring the integrated steel plant by March 2012. To bring it into practical, it is in the process of acquiring about 6,500 acres of land in and around Sonahatu block of Ranchi district to begin civil construction of the steel plant.
The company''s annual iron ore requirement would be hooked at about 16 million tons after the steel plant reaches its optimum production capacity. Down the line it would require around 480 million tons of processed iron ore.
As per the company''s disclosures, it has set early 2009 as the target for ground breaking and plant to bring the integrated steel plant by March 2012. To bring it into practical, it is in the process of acquiring about 6,500 acres of land in and around Sonahatu block of Ranchi district to begin civil construction of the steel plant.
The company''s annual iron ore requirement would be hooked at about 16 million tons after the steel plant reaches its optimum production capacity. Down the line it would require around 480 million tons of processed iron ore.
DLF faces selling pressures, fell over 5%
DLF, one of India’s largest real estate developers, drops by over 5% to trade at Rs396.95 after touching an intraday high of Rs409 and low of Rs391 at the Bombay Stock Exchange on Tuesday at 2.57PM. The total shares traded are 2734044. The scrip has touched 52 week high of Rs1225 and low of Rs391.
DLF is slowing down its project execution, especially in the tier II cities due to shrinking demand and expensive borrowing and for this it is retrenching employees across all its centres and subsidiaries.
The global credit crisis and double-digit domestic inflation have put the brakes on the unprecedented realty growth in India and for this the Indian firms are now looking for other ways to deal with it. Most realty firms are facing the cash shortage today, as much as they earned during the good times were deployed in land acquisition.
DLF is slowing down its project execution, especially in the tier II cities due to shrinking demand and expensive borrowing and for this it is retrenching employees across all its centres and subsidiaries.
The global credit crisis and double-digit domestic inflation have put the brakes on the unprecedented realty growth in India and for this the Indian firms are now looking for other ways to deal with it. Most realty firms are facing the cash shortage today, as much as they earned during the good times were deployed in land acquisition.
SAIL to invest Rs.150 crore for steel plant in J&K
Steel Authority of India Limited (SAIL), with five integrated steel plants and three alloy steel plants, is planning to construct a steel-processing unit in Lassipora Industrial Estate in Pulwama district of Jammu & Kashmir. To this plant, it will invest around Rs.150 crore in the plat, which will have a production capacity of 1,00,000 p.a. is expected to be operational by 2010.
As per the Ram Vilas Paswan, Steel Minister, the unit would manufacture finished products such as TMT bars in 8 to 25 mm diameter and galvanized corrugated sheets from input materials sourced from SAIL''s integrated steel plants. The unit will have a TMT bar mill with 40,000 tons p.a. capacity and cut-to-length and corrugation line of 60,000 tons p.a. capacity for GP coils/sheets. Spread across 25 acres of land, the unit will provide employment to nearly 5,000 people, which would constitute major local recruitment.
The steel production increased from 35 million tons p.a. to 59 million tons p.a. and within next three years it is expected to reach 124 million tons.
As per the Ram Vilas Paswan, Steel Minister, the unit would manufacture finished products such as TMT bars in 8 to 25 mm diameter and galvanized corrugated sheets from input materials sourced from SAIL''s integrated steel plants. The unit will have a TMT bar mill with 40,000 tons p.a. capacity and cut-to-length and corrugation line of 60,000 tons p.a. capacity for GP coils/sheets. Spread across 25 acres of land, the unit will provide employment to nearly 5,000 people, which would constitute major local recruitment.
The steel production increased from 35 million tons p.a. to 59 million tons p.a. and within next three years it is expected to reach 124 million tons.
Reliance gas delays leave investors cold
Mumbai: Mukesh Ambani must be losing the famed touch of the Ambanis.
On Sunday, he spoke to local media after almost five years and announced the first flow of oil from Reliance Industries Ltd’s deep-water wells in the Krishna-Godavari basin. He also said the company would start commercial production of gas from the basin in January.
On Monday, the company’s stock fell 0.72%.
Investors and analysts blame Reliance for a delay in production of gas that was previously expected to start in October or November this year.
Also See Southward in Tandem (Graphic)
That behaviour reflects their treatment of the stock which has a 15.03% weightage in the Bombay Stock Exchange’s 30-stock Sensex, India’s benchmark equity index.
Since the beginning of the year, shares of Reliance have fallen 29.29%, a result of falling refining margins and anticipated delays in gas production. The Sensex has fallen 31.02% in the same period.
On 18 September, the company’s shares fell to their lowest in the previous 52 weeks, Rs1,764. They ended Monday at Rs2,037.15 each.
“Oil production on track is normal. It is factored in but any delay (in gas production) is a negative,” said Ashu Madan, national head for domestic brokerage Religare Securities Ltd, which has a “neutral” rating on Reliance and expects the stock to move between Rs1,800 and Rs2,300 over the next three months.
Madan adds that in current market conditions, any “bad news will have a ripple effect”.
After Sunday’s announcements, most brokerages retained their “buy” rating on Reliance, but some have cut their price targets and earnings per share (EPS) estimates.
“RIL’s announcements (on Sunday) were in line with expectations, except for the delay in gas production,” said Rajat Rajgarhia, director-research, Motilal Oswal Securities Ltd, which has a “buy” rating on the stock.
“The street was expecting it to start before December. Minus that, there is no change in the fundamentals of the company.” His firm would be issuing a new target price this week and cutting its EPS estimates for Reliance, Rajgarhia added without giving details.
But the “buy” rating would stay, he said.
In the past two weeks, several brokerages have reduced their target price for Reliance. On 10 September, Citigroup Global Markets Inc.’s analysts Rahul Singh and Saurabh Handa said in a note that they were cutting their target price for Reliance to Rs2,450 per share from Rs2,850 because they expected gross refining margins to be around $1.5-2.0 per barrel lower than previous estimates due to “structural tightness for diesel” and increased supply from new refineries.
The analysts retained a “buy” rating on the stock.
On 9 September, Merrill Lynch retained its price target of Rs2,910 per share for Reliance but cut its EPS forecast by 4-9%.
One analyst with a foreign brokerage said Sunday’s announcement was a “disappointment”.
“We were factoring it (would start) from the end of this year and now it is almost late by a quarter. Therefore, it will have a sentimental impact although nothing has changed in the fundamentals of the company.” The analyst, who didn’t want to be named, added that the delay “is a surprise because it is coming from Reliance, which has an impeccable execution record of finishing projects before time.”
Reliance needs a legal dispute to be settled before it can sell gas from the basin. It is locked in two lawsuits with state-run power firm NTPC Ltd and Reliance Natural Resources Ltd, owned by Mukesh Ambani’s estranged younger brother Anil Ambani.
Reliance can produce 80 million cubic metres per day of gas from the basin
On Sunday, he spoke to local media after almost five years and announced the first flow of oil from Reliance Industries Ltd’s deep-water wells in the Krishna-Godavari basin. He also said the company would start commercial production of gas from the basin in January.
On Monday, the company’s stock fell 0.72%.
Investors and analysts blame Reliance for a delay in production of gas that was previously expected to start in October or November this year.
Also See Southward in Tandem (Graphic)
That behaviour reflects their treatment of the stock which has a 15.03% weightage in the Bombay Stock Exchange’s 30-stock Sensex, India’s benchmark equity index.
Since the beginning of the year, shares of Reliance have fallen 29.29%, a result of falling refining margins and anticipated delays in gas production. The Sensex has fallen 31.02% in the same period.
On 18 September, the company’s shares fell to their lowest in the previous 52 weeks, Rs1,764. They ended Monday at Rs2,037.15 each.
“Oil production on track is normal. It is factored in but any delay (in gas production) is a negative,” said Ashu Madan, national head for domestic brokerage Religare Securities Ltd, which has a “neutral” rating on Reliance and expects the stock to move between Rs1,800 and Rs2,300 over the next three months.
Madan adds that in current market conditions, any “bad news will have a ripple effect”.
After Sunday’s announcements, most brokerages retained their “buy” rating on Reliance, but some have cut their price targets and earnings per share (EPS) estimates.
“RIL’s announcements (on Sunday) were in line with expectations, except for the delay in gas production,” said Rajat Rajgarhia, director-research, Motilal Oswal Securities Ltd, which has a “buy” rating on the stock.
“The street was expecting it to start before December. Minus that, there is no change in the fundamentals of the company.” His firm would be issuing a new target price this week and cutting its EPS estimates for Reliance, Rajgarhia added without giving details.
But the “buy” rating would stay, he said.
In the past two weeks, several brokerages have reduced their target price for Reliance. On 10 September, Citigroup Global Markets Inc.’s analysts Rahul Singh and Saurabh Handa said in a note that they were cutting their target price for Reliance to Rs2,450 per share from Rs2,850 because they expected gross refining margins to be around $1.5-2.0 per barrel lower than previous estimates due to “structural tightness for diesel” and increased supply from new refineries.
The analysts retained a “buy” rating on the stock.
On 9 September, Merrill Lynch retained its price target of Rs2,910 per share for Reliance but cut its EPS forecast by 4-9%.
One analyst with a foreign brokerage said Sunday’s announcement was a “disappointment”.
“We were factoring it (would start) from the end of this year and now it is almost late by a quarter. Therefore, it will have a sentimental impact although nothing has changed in the fundamentals of the company.” The analyst, who didn’t want to be named, added that the delay “is a surprise because it is coming from Reliance, which has an impeccable execution record of finishing projects before time.”
Reliance needs a legal dispute to be settled before it can sell gas from the basin. It is locked in two lawsuits with state-run power firm NTPC Ltd and Reliance Natural Resources Ltd, owned by Mukesh Ambani’s estranged younger brother Anil Ambani.
Reliance can produce 80 million cubic metres per day of gas from the basin
Sahara India to sell stake in film, TV unit
Mumbai: Sahara India Financial Corp. Ltd, the country’s largest residuary non-banking finance company (RNBC), will sell its equity stake in Sahara One Media and Entertainment Ltd and use the proceeds to meet investment norms laid down by India’s banking regulator, the Reserve Bank of India, or RBI.
RBI recently directed Sahara not to accept deposits that mature beyond 30 June 2011.
An RNBC is required to invest all its deposits in government bonds, deposits of other commercial banks and corporate bonds with ratings of double A+ (AA+), indicating high safety.
Sahara India is one of the promoters of Sahara One Media and currently holds 16.32% stake in the company. Sahara One Media, which is into the business of television and film production, has a market value of Rs450.30 crore, based on its share price of Rs209 at close of trading on the Bombay Stock Exchange on Monday. This means that Sahara India’s stake is worth Rs73.49 crore.
Shares of the production house hit their lifetime high of Rs820 each on BSE on 10 January. At that price, its stake in the firm would have fetched Sahara India Rs288.33 crore.
Also Read Mint’s earlier coverage of the issue
In a June communication to RBI, days before the regulator banned it from accepting fresh deposits (this ban was subsequently lifted and the RNBC was given a three-year sunset window), Sahara India agreed to sell its equity holding in Sahara One to “bridge the gap in directed investments” in accordance with the norms of the central bank.
In that communication, a copy of which has been reviewed by Mint, Sahara India said it would bridge the gap “through internal accruals and/or by way of sale/mortgage/lien on its fixed assets”.
It assured the central bank that it would reduce the gap of Rs714.81 crore in directed investments to zero by December. “We are committed to make good the gap for the purpose of security for depositors by March 2009,” the firm said.
Abhijet Sarckar, head of corporate communications, Sahara India group, said in an email that, “Sahara India Financial Corp. Ltd proposes to transfer 3,075,000 shares of Sahara One to Sahara India Commercial Corp. Ltd through the BSE (Bombay Stock Exchange) on 26 September and as required under the regulations, information in this regard has been submitted Friday evening to BSE.”
BSE was yet to announce this information on its site till Monday evening.
Sarckar also said that there is no gap in Sahara India’s directed investment. “We would like to draw your attention to the fact sheet published by us wherein it was clearly stated that the value of directed investments held by the company fully covers its liability towards depositors.”
RBI recently directed Sahara not to accept deposits that mature beyond 30 June 2011.
An RNBC is required to invest all its deposits in government bonds, deposits of other commercial banks and corporate bonds with ratings of double A+ (AA+), indicating high safety.
Sahara India is one of the promoters of Sahara One Media and currently holds 16.32% stake in the company. Sahara One Media, which is into the business of television and film production, has a market value of Rs450.30 crore, based on its share price of Rs209 at close of trading on the Bombay Stock Exchange on Monday. This means that Sahara India’s stake is worth Rs73.49 crore.
Shares of the production house hit their lifetime high of Rs820 each on BSE on 10 January. At that price, its stake in the firm would have fetched Sahara India Rs288.33 crore.
Also Read Mint’s earlier coverage of the issue
In a June communication to RBI, days before the regulator banned it from accepting fresh deposits (this ban was subsequently lifted and the RNBC was given a three-year sunset window), Sahara India agreed to sell its equity holding in Sahara One to “bridge the gap in directed investments” in accordance with the norms of the central bank.
In that communication, a copy of which has been reviewed by Mint, Sahara India said it would bridge the gap “through internal accruals and/or by way of sale/mortgage/lien on its fixed assets”.
It assured the central bank that it would reduce the gap of Rs714.81 crore in directed investments to zero by December. “We are committed to make good the gap for the purpose of security for depositors by March 2009,” the firm said.
Abhijet Sarckar, head of corporate communications, Sahara India group, said in an email that, “Sahara India Financial Corp. Ltd proposes to transfer 3,075,000 shares of Sahara One to Sahara India Commercial Corp. Ltd through the BSE (Bombay Stock Exchange) on 26 September and as required under the regulations, information in this regard has been submitted Friday evening to BSE.”
BSE was yet to announce this information on its site till Monday evening.
Sarckar also said that there is no gap in Sahara India’s directed investment. “We would like to draw your attention to the fact sheet published by us wherein it was clearly stated that the value of directed investments held by the company fully covers its liability towards depositors.”
Lehman bond holders likely to lose $100 billion: Report
London: Bondholders of the beleaguered Lehman Brothers may lose $110 billion (Rs5 trillion) due to the decline in the asset values of the fourth-largest investment bank in the US, media reports say.
The value of the bonds of Lehman Brothers saw a major fall after the investment bank filed for bankruptcy protection, the Financial Times report said adding, “Further losses on its derivatives positions, which are still being unwound, could leave even less on the table for bond investors.”
According to the FT report, Loomis Sayles vice-chairman Dan Fuss has said, “I don’t know how this will play out for bondholders, but I doubt if its going to be good.”
Loomis Sayles has a small holding in Lehman bonds.
The losses would have a far-reaching effect on ordinary investors, FT said as Lehman bonds were widely held by investors such as pension funds and mutual funds.
Meanwhile, those who sold protection against a default or Lehman bankruptcy will possibly recover 18 cents on the dollar when the contracts settle in a complicated auction 10 October, the report added.
Before Lehman filed for bankruptcy, its $110-billion of senior bonds were quoted around 95 cents on the dollar. Bond prices then plunged to 35 cents a week ago. They are now trading at about 18 cents to the dollar.
Quoting Kathleen Shanley of Gimme Credit, an analyst from a credit research firm, FT said, “Lehman bonds are trading in the high teens, which reflects the bankruptcy filing, in which a large number of creditors are competing for a shrinking pool of assets of uncertain value”.
Last week, Lehman inked a deal to sell the North American investment banking business to Barclays for $1.75 billion. “Even though approval of the deal was rushed through court, lawyers for Lehman Brothers said asset values then dropped to $47.4 billion from about $70 billion,” the report said.
In its bankruptcy filing, Lehman listed total debts of $613 billion, making it the largest ever US bankruptcy with $128 billion in debt securities, including $110.69 billion unsecured debt, $17.6 billion in unsecured, subordinated obligations, the media report said.
Further, FT quoted creditors as saying that Lehman can be involved in the government’s plan to set up a $700-billion fund to buy distressed mortgage assets.
So far, there had been no formal discussions among the creditors about this, said a person involved in the bankruptcy case. The facility could boost recoveries for various creditors.
The value of the bonds of Lehman Brothers saw a major fall after the investment bank filed for bankruptcy protection, the Financial Times report said adding, “Further losses on its derivatives positions, which are still being unwound, could leave even less on the table for bond investors.”
According to the FT report, Loomis Sayles vice-chairman Dan Fuss has said, “I don’t know how this will play out for bondholders, but I doubt if its going to be good.”
Loomis Sayles has a small holding in Lehman bonds.
The losses would have a far-reaching effect on ordinary investors, FT said as Lehman bonds were widely held by investors such as pension funds and mutual funds.
Meanwhile, those who sold protection against a default or Lehman bankruptcy will possibly recover 18 cents on the dollar when the contracts settle in a complicated auction 10 October, the report added.
Before Lehman filed for bankruptcy, its $110-billion of senior bonds were quoted around 95 cents on the dollar. Bond prices then plunged to 35 cents a week ago. They are now trading at about 18 cents to the dollar.
Quoting Kathleen Shanley of Gimme Credit, an analyst from a credit research firm, FT said, “Lehman bonds are trading in the high teens, which reflects the bankruptcy filing, in which a large number of creditors are competing for a shrinking pool of assets of uncertain value”.
Last week, Lehman inked a deal to sell the North American investment banking business to Barclays for $1.75 billion. “Even though approval of the deal was rushed through court, lawyers for Lehman Brothers said asset values then dropped to $47.4 billion from about $70 billion,” the report said.
In its bankruptcy filing, Lehman listed total debts of $613 billion, making it the largest ever US bankruptcy with $128 billion in debt securities, including $110.69 billion unsecured debt, $17.6 billion in unsecured, subordinated obligations, the media report said.
Further, FT quoted creditors as saying that Lehman can be involved in the government’s plan to set up a $700-billion fund to buy distressed mortgage assets.
So far, there had been no formal discussions among the creditors about this, said a person involved in the bankruptcy case. The facility could boost recoveries for various creditors.
Weak opening in European markets
Weak opening in European markets pulled the key indices sharply
lower in afternoon trade. The 30-share BSE Sensex was down 220.08
points. Index heavyweight Reliance Industries held firm in positive
territory, while Ranbaxy Laboratories slipped further. Selling was
also visible in the mid-cap and small-cap counters.
European markets opened lower. Key indices in UK, France and
Germany were down 0.56% to 1.41%. Asian markets, which opened
before Indian markets, were mixed. Key indices in China, Hong Kong
and Singapore were down by 1.56% to 3.34%. However, key indices in
Taiwan and South Korea were up by 1.17% to 1.44%. Japanese
financial markets were closed today for Autumnal Equinox Day, a
national holiday.
At 13:20 IST, the BSE 30-share Sensex was down 220.08 points or
1.57% to 13,774.88. The index shed 273.54 points at the day's low
of 13,721.42, hit in the onset of trading session. The Sensex fell
16.7 points at day's high of 13,978.26, hit in mid-morning.
The S&P CNX Nifty was down 50.35 points or 1.19% to 4172.70.
The BSE Mid-Cap index was down 1.23% at 5,156.67 and the BSE
Small-Cap index was down 0.86% at 6,140.93.
The market breadth was weak on BSE with 761 shares advancing as
compared to 1672 that declined. 65 shares remained unchanged.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) rose 1.32% at Rs 2063. The
stock came off session's low of Rs 2,000. Reliance Industries (RIL)
began production of crude oil at KG-D6 block of the Krishna
Godavari basin on 17 September 2008, the company said on 22
September 2008. RIL holds 90% participating interest in the block
while the balance is being held by Niko Resources.
India's largest drug maker by sales Ranbaxy Laboratories declined
10.74% at Rs 310 on reports the Canadian drug regulator, Health
Canada, issued a notice to Ranbaxy saying it will be particularly
cautious about drug marketing applications from Ranbaxy after the
US drug regulator blocked the sale of more than 30 generic
medicines made in two factories by the company. The stock had
declined 2.70% in the previous session.
India's largest aluminium producer Hindalco Industries fell 0.64%
at 109.20 after hitting a 52-week low of Rs 106.20 on BSE. The
company's Rs 5,050 crore rights share offering for subscription
Monday, 22 September 2008. The sale in a ratio of three shares for
every seven held at Rs 96 a share will close on 10 October 2008.
The company aims to use the funds to repay a bridge loan it had
taken to buy Canada's Novelis in 2007.
Realty shares tumbled. DLF (down 5.35% at Rs 398.40), Indiabulls
Real Estate (down 4.82% at Rs 214.25), Housing Development &
Infrastructure (down 4.04% at Rs 213.90), and Unitech (down 3.07%
at Rs 124.55), slipped. The BSE Realty index was down 3.35% at
3,958.45.
Banking shares languished in neagtive terrain. ICICI Bank (down
3.46% at Rs 612.50), State Bank of India (down 3.11% at Rs 1,518),
and HDFC Bank (down 1.27% at Rs 1,281.15), tumbled. The BSE Bankex
was down 2.58% at 6,919.19.
Among the side counters, Deccan Chronicle Holdings (down 10% at Rs
105.50), Sintex Industries (down 7.21% at Rs 285.15), Rolta
Industries (down 6.99% at Rs 267.95), and Pantaloon Retail India
(down 5.65% at Rs 286.50), tumbled.
lower in afternoon trade. The 30-share BSE Sensex was down 220.08
points. Index heavyweight Reliance Industries held firm in positive
territory, while Ranbaxy Laboratories slipped further. Selling was
also visible in the mid-cap and small-cap counters.
European markets opened lower. Key indices in UK, France and
Germany were down 0.56% to 1.41%. Asian markets, which opened
before Indian markets, were mixed. Key indices in China, Hong Kong
and Singapore were down by 1.56% to 3.34%. However, key indices in
Taiwan and South Korea were up by 1.17% to 1.44%. Japanese
financial markets were closed today for Autumnal Equinox Day, a
national holiday.
At 13:20 IST, the BSE 30-share Sensex was down 220.08 points or
1.57% to 13,774.88. The index shed 273.54 points at the day's low
of 13,721.42, hit in the onset of trading session. The Sensex fell
16.7 points at day's high of 13,978.26, hit in mid-morning.
The S&P CNX Nifty was down 50.35 points or 1.19% to 4172.70.
The BSE Mid-Cap index was down 1.23% at 5,156.67 and the BSE
Small-Cap index was down 0.86% at 6,140.93.
The market breadth was weak on BSE with 761 shares advancing as
compared to 1672 that declined. 65 shares remained unchanged.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) rose 1.32% at Rs 2063. The
stock came off session's low of Rs 2,000. Reliance Industries (RIL)
began production of crude oil at KG-D6 block of the Krishna
Godavari basin on 17 September 2008, the company said on 22
September 2008. RIL holds 90% participating interest in the block
while the balance is being held by Niko Resources.
India's largest drug maker by sales Ranbaxy Laboratories declined
10.74% at Rs 310 on reports the Canadian drug regulator, Health
Canada, issued a notice to Ranbaxy saying it will be particularly
cautious about drug marketing applications from Ranbaxy after the
US drug regulator blocked the sale of more than 30 generic
medicines made in two factories by the company. The stock had
declined 2.70% in the previous session.
India's largest aluminium producer Hindalco Industries fell 0.64%
at 109.20 after hitting a 52-week low of Rs 106.20 on BSE. The
company's Rs 5,050 crore rights share offering for subscription
Monday, 22 September 2008. The sale in a ratio of three shares for
every seven held at Rs 96 a share will close on 10 October 2008.
The company aims to use the funds to repay a bridge loan it had
taken to buy Canada's Novelis in 2007.
Realty shares tumbled. DLF (down 5.35% at Rs 398.40), Indiabulls
Real Estate (down 4.82% at Rs 214.25), Housing Development &
Infrastructure (down 4.04% at Rs 213.90), and Unitech (down 3.07%
at Rs 124.55), slipped. The BSE Realty index was down 3.35% at
3,958.45.
Banking shares languished in neagtive terrain. ICICI Bank (down
3.46% at Rs 612.50), State Bank of India (down 3.11% at Rs 1,518),
and HDFC Bank (down 1.27% at Rs 1,281.15), tumbled. The BSE Bankex
was down 2.58% at 6,919.19.
Among the side counters, Deccan Chronicle Holdings (down 10% at Rs
105.50), Sintex Industries (down 7.21% at Rs 285.15), Rolta
Industries (down 6.99% at Rs 267.95), and Pantaloon Retail India
(down 5.65% at Rs 286.50), tumbled.
Ranbaxy tumbles
sharp sell-off in banking pivotals once again pulled the key
benchmark indices lower in early afternoon trade, derailing a sharp
recovery seen in mid-morning trade led by index heavyweight
Reliance Industries. Volatility was high. All the sectoral indices
on BSE, barring the Oil & Gas index, were negative. The 30-shares
BSE Sensex slipped 181.56 points from the session's high. Ranbaxy
Laboratories tumbled over 5%. Hindalco Industries slipped to a
52-week low of Rs 106.20 on BSE.
At 12:20 IST, the BSE 30-share Sensex was down 198.26 points or
1.42% to 13,796.70. The index shed 273.54 points at the day's low
of 13,721.42, hit in the onset of trading session. The Sensex fell
16.7 points at day's high of 13,978.26, hit in mid-morning.
The S&P CNX Nifty was down 52 points or 1.23% to 4,171.05.
The BSE Mid-Cap index was down 1.04% at 5,166.65 and the BSE
Small-Cap index was down 0.87% at 6,140.28.
The market breadth was weak on BSE with 739 shares advancing as
compared to 1539 that declined. 75 shares remained unchanged.
Banking shares were hard hit on fears local banks may reportedly
suffer losses on their exposure to the US financial giants that
collapsed recently. ICICI Bank (down 2.64% at Rs 617.70), State
Bank of India (down 2.83% at Rs1522.30), and HDFC Bank (down 1.50%
at Rs 1278.20), declined. The BSE Bankex was down 2.18% at
6,947.66.
As per reports, nine of the country's largest commercial banks
including State Bank of India (SBI), ICICI Bank and HDFC Bank
reportedly have exposure of $420 million (Rs 2,000 crore) in the US
financial giants. As per the government, banks other than SBI would
suffer losses of Rs 600 crore due to the crisis. SBI alone has
exposure of $170 million in Freddie Mac and Fannie Mae. The public
sector giant's exposure in Lehman Brothers is estimated at $17
million.
The estimated losses are due to their ownership of securities sold
by Fannie Mae, Freddie Mac, Merrill Lynch & Co., and Lehman
Brothers Holding Inc, which have declined in value leading to
marked-to-market losses, the report said.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) rose 1.66% at Rs 2071. The
stock came off session's low of Rs 2,000. Reliance Industries (RIL)
began production of crude oil at KG-D6 block of the Krishna
Godavari basin on 17 September 2008, the company said on 22
September 2008. RIL holds 90% participating interest in the block
while the balance is being held by Niko Resources.
India's largest drug maker by sales Ranbaxy Laboratories declined
5.24% at Rs 329 on reports the Canadian drug regulator, Health
Canada, issued a notice to Ranbaxy saying it will be particularly
cautious about drug marketing applications from Ranbaxy after the
US drug regulator blocked the sale of more than 30 generic
medicines made in two factories by the company. The stock had
declined 2.70% in the previous session.
India's largest aluminium producer Hindalco Industries fell 2.14%
at 107.45 after hitting a 52-week low of Rs 106.20 on BSE. The
company's Rs 5,050 crore rights share offering for subscription
Monday, 22 September 2008. The sale in a ratio of three shares for
every seven held at Rs 96 a share will close on 10 October 2008.
The company aims to use the funds to repay a bridge loan it had
taken to buy Canada's Novelis in 2007.
India's largest real estate developer by market capitalisation DLF
fell 5.77% at Rs 396.50. As per recent reports, the company is
retrenching around 300 employees across all its centres and
subsidiaries as it decides to slow down its project execution,
especially in Tier II cities, in the face of shrinking demand and
expensive borrowing.
Sterlite Industries (up 1.63% at Rs 467.50), Tata Power Company (up
1.13% at Rs 1032.25), and Reliance Communication (up 0.30% at Rs
370.45), were the top gainers from the Sensex.
Other major Sensex losers were, Jaiprakash Associates (down 4.96%
at Rs 123.60), Housing Development Finance Corporation (down 2.24%
at Rs 2272.50), and Tata Motors (down 2.24% at Rs 405).
Software shares declined on fears of decline in IT expenditure in
the US market due lingering worries of a slowdown. Satyam Computer
(down 4.20% at Rs 337.95), Wipro (down 3.83% at Rs 398.50), TCS
(down 1.375 at Rs 755.50), and Infosys Technologies (down 2.65% at
Rs 1584.70), declined.
benchmark indices lower in early afternoon trade, derailing a sharp
recovery seen in mid-morning trade led by index heavyweight
Reliance Industries. Volatility was high. All the sectoral indices
on BSE, barring the Oil & Gas index, were negative. The 30-shares
BSE Sensex slipped 181.56 points from the session's high. Ranbaxy
Laboratories tumbled over 5%. Hindalco Industries slipped to a
52-week low of Rs 106.20 on BSE.
At 12:20 IST, the BSE 30-share Sensex was down 198.26 points or
1.42% to 13,796.70. The index shed 273.54 points at the day's low
of 13,721.42, hit in the onset of trading session. The Sensex fell
16.7 points at day's high of 13,978.26, hit in mid-morning.
The S&P CNX Nifty was down 52 points or 1.23% to 4,171.05.
The BSE Mid-Cap index was down 1.04% at 5,166.65 and the BSE
Small-Cap index was down 0.87% at 6,140.28.
The market breadth was weak on BSE with 739 shares advancing as
compared to 1539 that declined. 75 shares remained unchanged.
Banking shares were hard hit on fears local banks may reportedly
suffer losses on their exposure to the US financial giants that
collapsed recently. ICICI Bank (down 2.64% at Rs 617.70), State
Bank of India (down 2.83% at Rs1522.30), and HDFC Bank (down 1.50%
at Rs 1278.20), declined. The BSE Bankex was down 2.18% at
6,947.66.
As per reports, nine of the country's largest commercial banks
including State Bank of India (SBI), ICICI Bank and HDFC Bank
reportedly have exposure of $420 million (Rs 2,000 crore) in the US
financial giants. As per the government, banks other than SBI would
suffer losses of Rs 600 crore due to the crisis. SBI alone has
exposure of $170 million in Freddie Mac and Fannie Mae. The public
sector giant's exposure in Lehman Brothers is estimated at $17
million.
The estimated losses are due to their ownership of securities sold
by Fannie Mae, Freddie Mac, Merrill Lynch & Co., and Lehman
Brothers Holding Inc, which have declined in value leading to
marked-to-market losses, the report said.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) rose 1.66% at Rs 2071. The
stock came off session's low of Rs 2,000. Reliance Industries (RIL)
began production of crude oil at KG-D6 block of the Krishna
Godavari basin on 17 September 2008, the company said on 22
September 2008. RIL holds 90% participating interest in the block
while the balance is being held by Niko Resources.
India's largest drug maker by sales Ranbaxy Laboratories declined
5.24% at Rs 329 on reports the Canadian drug regulator, Health
Canada, issued a notice to Ranbaxy saying it will be particularly
cautious about drug marketing applications from Ranbaxy after the
US drug regulator blocked the sale of more than 30 generic
medicines made in two factories by the company. The stock had
declined 2.70% in the previous session.
India's largest aluminium producer Hindalco Industries fell 2.14%
at 107.45 after hitting a 52-week low of Rs 106.20 on BSE. The
company's Rs 5,050 crore rights share offering for subscription
Monday, 22 September 2008. The sale in a ratio of three shares for
every seven held at Rs 96 a share will close on 10 October 2008.
The company aims to use the funds to repay a bridge loan it had
taken to buy Canada's Novelis in 2007.
India's largest real estate developer by market capitalisation DLF
fell 5.77% at Rs 396.50. As per recent reports, the company is
retrenching around 300 employees across all its centres and
subsidiaries as it decides to slow down its project execution,
especially in Tier II cities, in the face of shrinking demand and
expensive borrowing.
Sterlite Industries (up 1.63% at Rs 467.50), Tata Power Company (up
1.13% at Rs 1032.25), and Reliance Communication (up 0.30% at Rs
370.45), were the top gainers from the Sensex.
Other major Sensex losers were, Jaiprakash Associates (down 4.96%
at Rs 123.60), Housing Development Finance Corporation (down 2.24%
at Rs 2272.50), and Tata Motors (down 2.24% at Rs 405).
Software shares declined on fears of decline in IT expenditure in
the US market due lingering worries of a slowdown. Satyam Computer
(down 4.20% at Rs 337.95), Wipro (down 3.83% at Rs 398.50), TCS
(down 1.375 at Rs 755.50), and Infosys Technologies (down 2.65% at
Rs 1584.70), declined.
Market pares losses
The key benchmark indices staged a sharp recovery as index
heavyweight Reliance Industries moved higher. The 30-share BSE
Sensex recovered nearly 240 points from the days low. Realty and
software shares declined. Mid-cap and small-cap shares witnessed
selling pressure.
At 11:20 IST, the BSE 30-share Sensex was down 33.52 points or
0.24% to 13,961.44. The index shed 273.54 points at the day's low
of 13,721.42, hit in the onset of trading session. The Sensex fell
16.7 points at day's high of 13,978.26, hit in mid-morning.
The S&P CNX Nifty was down 8.45 points or 0.20% to 4214.60.
The BSE Mid-Cap index was down 0.39% at 5,200.44 and the BSE
Small-Cap index was down 0.44% at 6,166.60.
The market breadth was weak on BSE with 763 shares advancing as
compared to 1266 that declined. 72 shares remained unchanged.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) rose 2.39% at Rs 2089.90. The
stock came off session's low of Rs 2000.
India's largest drug maker by sales Ranbaxy Laboratories declined
5.24% at Rs 329 on reports the Canadian drug regulator, Health
Canada, issued a notice to Ranbaxy saying it will be particularly
cautious about drug marketing applications from Ranbaxy after the
US drug regulator blocked the sale of more than 30 generic
medicines made in two factories by the company.
Software firms fell on lingering concerns about the economic
prospects for the United States, their biggest export market. Wipro
(down 2.72% at Rs 403.10), Satyam Computer (down 2.17% at Rs
345.10), TCS (down 0.53% at Rs 761.95), and Infosys Technologies
(down 1.47% at Rs 1604), declined. The BSE IT index was down 1.57%
at 3,582.43.
State-run oil refiners fell after crude oil prices advanced. HPCL
(down 2.67% at Rs 224.45), BPCL (down 1.60% at Rs 331.70), and
Indian Oil Corporation (down 1.09% at Rs 378.25), slipped.
Realty shares tumbled. DLF (down 3.78% at Rs 405.10), Indiabulls
Real Estate (down 2.93% at Rs 219), Unitech (down 2.92% at Rs
124.65), and Housing Development & Infrastructure (down 2.83% at Rs
216.85), slipped. The BSE Realty index was down 3.37% at 3,957.34.
Banking shares declined. India's largest private sector bank by
market capitalisation ICICI Bank fell 1.62% to Rs 624.20. HDFC Bank
(down 0.93% at Rs 1285.50), and State Bank of India (down 0.36% at
Rs 1562), declined. The BSE Bankex fell 1.34% at 7,007.06.
Asian markets, which open before Indian markets, were mixed. Key
indices in China, Hong Kong and Singapore were down by 0.39% to
2.68%. However, key indices in Taiwan and South Korea were up by
1.17% to 1.46%. Japanese financial markets were closed today for
Autumnal Equinox Day, a national holiday.
heavyweight Reliance Industries moved higher. The 30-share BSE
Sensex recovered nearly 240 points from the days low. Realty and
software shares declined. Mid-cap and small-cap shares witnessed
selling pressure.
At 11:20 IST, the BSE 30-share Sensex was down 33.52 points or
0.24% to 13,961.44. The index shed 273.54 points at the day's low
of 13,721.42, hit in the onset of trading session. The Sensex fell
16.7 points at day's high of 13,978.26, hit in mid-morning.
The S&P CNX Nifty was down 8.45 points or 0.20% to 4214.60.
The BSE Mid-Cap index was down 0.39% at 5,200.44 and the BSE
Small-Cap index was down 0.44% at 6,166.60.
The market breadth was weak on BSE with 763 shares advancing as
compared to 1266 that declined. 72 shares remained unchanged.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) rose 2.39% at Rs 2089.90. The
stock came off session's low of Rs 2000.
India's largest drug maker by sales Ranbaxy Laboratories declined
5.24% at Rs 329 on reports the Canadian drug regulator, Health
Canada, issued a notice to Ranbaxy saying it will be particularly
cautious about drug marketing applications from Ranbaxy after the
US drug regulator blocked the sale of more than 30 generic
medicines made in two factories by the company.
Software firms fell on lingering concerns about the economic
prospects for the United States, their biggest export market. Wipro
(down 2.72% at Rs 403.10), Satyam Computer (down 2.17% at Rs
345.10), TCS (down 0.53% at Rs 761.95), and Infosys Technologies
(down 1.47% at Rs 1604), declined. The BSE IT index was down 1.57%
at 3,582.43.
State-run oil refiners fell after crude oil prices advanced. HPCL
(down 2.67% at Rs 224.45), BPCL (down 1.60% at Rs 331.70), and
Indian Oil Corporation (down 1.09% at Rs 378.25), slipped.
Realty shares tumbled. DLF (down 3.78% at Rs 405.10), Indiabulls
Real Estate (down 2.93% at Rs 219), Unitech (down 2.92% at Rs
124.65), and Housing Development & Infrastructure (down 2.83% at Rs
216.85), slipped. The BSE Realty index was down 3.37% at 3,957.34.
Banking shares declined. India's largest private sector bank by
market capitalisation ICICI Bank fell 1.62% to Rs 624.20. HDFC Bank
(down 0.93% at Rs 1285.50), and State Bank of India (down 0.36% at
Rs 1562), declined. The BSE Bankex fell 1.34% at 7,007.06.
Asian markets, which open before Indian markets, were mixed. Key
indices in China, Hong Kong and Singapore were down by 0.39% to
2.68%. However, key indices in Taiwan and South Korea were up by
1.17% to 1.46%. Japanese financial markets were closed today for
Autumnal Equinox Day, a national holiday.
Market open lower
Weakness in global markets spilled over to the Indian markets. The
30-share BSE Sensex opened 273.54 points lower. Stocks across the
globe declined on concerns that the US Federal Reserve's $700
billion bailout plan may not revive the economy. Firmness in crude
oil prices rekindle inflation worries and added to the negative
sentiment.
Crude oil prices soared to an intra-day high of $130 a barrel on
Monday, 22 September 2008 before easing in a rally sparked by the
expiry of the front-month futures contract and weakness in the US
dollar. US light crude for November delivery was down 42 cents at
$108.95 a barrel.
Asian markets, which open before Indian markets, were mixed. Key
indices in China, Hong Kong and Singapore were down by 0.96% to
2.68%. However, key indices in Taiwan and South Korea were up by
0.21% to 0.96%. Japanese financial markets were closed today for
Autumnal Equinox Day, a national holiday.
US markets witnessed a sell off on Monday, 22 September 2008 on
worries about the government's ability to bailout the financial
system. The Dow plunged 372.75 points, or 3.27%, to 11,015.69. The
S&P 500 index slipped 47.99 points, or 3.82%, to 1,207.09, and the
Nasdaq Composite index was down 94.92 points, or 4.17%, to
2,178.98.
At 10:20 IST, the BSE 30-share Sensex was down 154.76 points or
1.11% to 13,840.20. The index shed 273.54 points at the day's low
of 13,721.42, hit in the onset of trading session. The Sensex fell
115.9 points at day's high of 13,879.06, hit in early trade.
The S&P CNX Nifty was down 42.05 points or 1% to 4181.
The BSE Mid-Cap index was up 0.61% at 5,189.11 and the BSE
Small-Cap index was down 0.72% at 6,149.77.
The market breadth was weak on BSE with 452 shares advancing as
compared to 1007 that declined. 47 shares remained unchanged.
Sterlite Industries (up 1.52% at Rs 467.10), ACC (up 1.16% at Rs
632.80), Larsen & Toubro (up 0.56% at Rs 2591), Tata Power Company
(up 0.24% at Rs 1023.15), and Grasim Industries (up 0.20% at Rs
1941), were the major gainers from the Sensex pack.
Ranbaxy Laboratories (down 5.10% at Rs 329.50), DLF (down 4.43% at
Rs 402.60), Wipro (down 3.41% at Rs 400.20), Satyam Computer (down
2.08% at Rs 345.90), Bharat Heavy Electrical (down 2.13% at Rs
1648), were the major losers from the Sensex pack.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) fell 0.44% at Rs 2028.80.
India's second largest software exporter by sales Infosys
Technologies fell 2.23% at Rs 1591.55.
India's largest private sector bank by market capitalisation ICICI
Bank fell 2.61% at Rs 617.10.
Iron ore miner Sesa Goa was the top traded scrip on BSE in terms of
turnover. The stock was up 5.43% at Rs 130 on a turnover of 53.23
crore on BSE.
30-share BSE Sensex opened 273.54 points lower. Stocks across the
globe declined on concerns that the US Federal Reserve's $700
billion bailout plan may not revive the economy. Firmness in crude
oil prices rekindle inflation worries and added to the negative
sentiment.
Crude oil prices soared to an intra-day high of $130 a barrel on
Monday, 22 September 2008 before easing in a rally sparked by the
expiry of the front-month futures contract and weakness in the US
dollar. US light crude for November delivery was down 42 cents at
$108.95 a barrel.
Asian markets, which open before Indian markets, were mixed. Key
indices in China, Hong Kong and Singapore were down by 0.96% to
2.68%. However, key indices in Taiwan and South Korea were up by
0.21% to 0.96%. Japanese financial markets were closed today for
Autumnal Equinox Day, a national holiday.
US markets witnessed a sell off on Monday, 22 September 2008 on
worries about the government's ability to bailout the financial
system. The Dow plunged 372.75 points, or 3.27%, to 11,015.69. The
S&P 500 index slipped 47.99 points, or 3.82%, to 1,207.09, and the
Nasdaq Composite index was down 94.92 points, or 4.17%, to
2,178.98.
At 10:20 IST, the BSE 30-share Sensex was down 154.76 points or
1.11% to 13,840.20. The index shed 273.54 points at the day's low
of 13,721.42, hit in the onset of trading session. The Sensex fell
115.9 points at day's high of 13,879.06, hit in early trade.
The S&P CNX Nifty was down 42.05 points or 1% to 4181.
The BSE Mid-Cap index was up 0.61% at 5,189.11 and the BSE
Small-Cap index was down 0.72% at 6,149.77.
The market breadth was weak on BSE with 452 shares advancing as
compared to 1007 that declined. 47 shares remained unchanged.
Sterlite Industries (up 1.52% at Rs 467.10), ACC (up 1.16% at Rs
632.80), Larsen & Toubro (up 0.56% at Rs 2591), Tata Power Company
(up 0.24% at Rs 1023.15), and Grasim Industries (up 0.20% at Rs
1941), were the major gainers from the Sensex pack.
Ranbaxy Laboratories (down 5.10% at Rs 329.50), DLF (down 4.43% at
Rs 402.60), Wipro (down 3.41% at Rs 400.20), Satyam Computer (down
2.08% at Rs 345.90), Bharat Heavy Electrical (down 2.13% at Rs
1648), were the major losers from the Sensex pack.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries (RIL) fell 0.44% at Rs 2028.80.
India's second largest software exporter by sales Infosys
Technologies fell 2.23% at Rs 1591.55.
India's largest private sector bank by market capitalisation ICICI
Bank fell 2.61% at Rs 617.10.
Iron ore miner Sesa Goa was the top traded scrip on BSE in terms of
turnover. The stock was up 5.43% at Rs 130 on a turnover of 53.23
crore on BSE.
Pre Market Report 23/09/2008
Key benchmark indices are geared for a weak start today, 23 September 2008 tracking weak global markets on concerns of the long-term implications of the US Federal Reserve's $700 billion bailout plan worried investors. Volatility is likely to remain high as derivative contracts for September 2008 series expire on Thursday, 25 September 2008.
As per reports, Nifty rollover of positions from September 2008 series to October 2008 series was 29% while market-wide rollover stood at 25%, as on Monday, 22 September 2008.
Crude oil prices soared to an intra-day high of $130 a barrel on Monday, 22 September 2008 before easing in a rally sparked by the expiry of the front-month futures contract and weakness in the US dollar. US light crude for November delivery was down 42 cents at $108.95 a barrel.
Most Asian markets were trading weak today, 23 September 2008. China's Shanghai Composite slipped 0.48% or 10.83 points at 2,225.57, Hong Kong's Hang Seng plunged 2.19% or 429.51 points at 19,202.69, Singapore's Straits Times fell 1.88% or 47.78 points at 2,496.35, Taiwan's Taiwan Weighted dropped 0.21% 12.72 points at 6,097.88. However, South Korea's Seoul Composite was up 0.31% or 4.58 points at 1,464.92.
US markets witnessed a sell off on Monday, 22 September 2008 on worries about the government's ability to bailout the financial system. The Dow plunged 372.75 points, or 3.27%, to 11,015.69. The S&P 500 index slipped 47.99 points, or 3.82%, to 1,207.09, and the Nasdaq Composite index was down 94.92 points, or 4.17%, to 2,178.98.
Back home, profit booking after a solid surge in the previous session and rise in crude oil pulled the market lower on Monday, 22 September 2008. The BSE 30-share Sensex fell 47.36 points or 0.34% to 13,994.96 and the S&P CNX Nifty fell 22.20 points or 0.52% to 4223.05.
Foreign institutional investors (FIIs) were net equity buyers worth Rs 138.21 crore while mutual funds sold shares worth Rs 206.12 crore on Monday, 22 September 2008, according to provisional data on NSE. They were net buyers of Rs 511.52 crore in the futures & options segment on Monday, 22 September 2008.
As per reports, Nifty rollover of positions from September 2008 series to October 2008 series was 29% while market-wide rollover stood at 25%, as on Monday, 22 September 2008.
Crude oil prices soared to an intra-day high of $130 a barrel on Monday, 22 September 2008 before easing in a rally sparked by the expiry of the front-month futures contract and weakness in the US dollar. US light crude for November delivery was down 42 cents at $108.95 a barrel.
Most Asian markets were trading weak today, 23 September 2008. China's Shanghai Composite slipped 0.48% or 10.83 points at 2,225.57, Hong Kong's Hang Seng plunged 2.19% or 429.51 points at 19,202.69, Singapore's Straits Times fell 1.88% or 47.78 points at 2,496.35, Taiwan's Taiwan Weighted dropped 0.21% 12.72 points at 6,097.88. However, South Korea's Seoul Composite was up 0.31% or 4.58 points at 1,464.92.
US markets witnessed a sell off on Monday, 22 September 2008 on worries about the government's ability to bailout the financial system. The Dow plunged 372.75 points, or 3.27%, to 11,015.69. The S&P 500 index slipped 47.99 points, or 3.82%, to 1,207.09, and the Nasdaq Composite index was down 94.92 points, or 4.17%, to 2,178.98.
Back home, profit booking after a solid surge in the previous session and rise in crude oil pulled the market lower on Monday, 22 September 2008. The BSE 30-share Sensex fell 47.36 points or 0.34% to 13,994.96 and the S&P CNX Nifty fell 22.20 points or 0.52% to 4223.05.
Foreign institutional investors (FIIs) were net equity buyers worth Rs 138.21 crore while mutual funds sold shares worth Rs 206.12 crore on Monday, 22 September 2008, according to provisional data on NSE. They were net buyers of Rs 511.52 crore in the futures & options segment on Monday, 22 September 2008.
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