The chief executives of Morgan Stanley and Merrill Lynch & Co. are going without bonuses for a year that has seen Wall Street ravaged by staggering losses, mass layoffs and the collapse of storied firms.
Morgan Stanley’s CEO John J Mack is giving up a bonus for the second straight year, while Merrill Lynch & Co. said its CEO John Thain also asked to go without the extra compensation for 2008 after reports surfaced he had sought as much as $10 million.
Mack told employees Monday in a memo that he and the firm’s two presidents, James Gorman and Walid Chammah, informed the board’s compensation committee of their decision to forgo 2008 bonuses, and the committee accepted.
Mack who did not receive a bonus for 2007, either said the company is changing year-end compensation for other employees, too.
The executives, however, are still being paid. Last year, Mack earned a salary of $800,000 as well as nearly $400,000 in other compensation, including personal use of a corporate jet.
Compensation for the 14 members of the firm’s operating committee will be down an average of 75%, and down 65% for the 35 members of the management committee.
Morgan Stanley plans to tie compensation for all employees eligible for bonuses more closely to performance. It will also allow for “clawbacks” where the company could reclaim any bonus paid to an employee if his or her actions led to “the need for a restatement of results, a significant financial loss or other reputational harm,” the memo said.
The CEO compensation debate comes as global banks have lost billions of dollars amid a credit crisis that still has yet to be contained. In the last few months, major US banks have taken advantage of a $700 billion government bailout program to help them avoid fates similar to that of investment bank Lehman Brothers Holdings Inc., which declared Chapter 11 bankruptcy in October.
Goldman Sachs CEO Lloyd Blankfein _ and six of his top lieutenants _ announced last month that they won’t take cash or stock bonuses for 2008.
Merrill Lynch said Thain and four other top executives President and COO Greg Fleming, Chief Financial Officer Nelson Chai, President of Global Wealth Management Robert McCann, and General Counsel Rosemary Berkery have all requested that they do not receive bonuses for 2008. According to a statement by the bank, the executives cited “current economic and market conditions” for their request. Directors at the regularly scheduled board meeting Monday accepted the offer.
The Wall Street Journal reported that Thain previously sought a multimillion dollar bonus, which raised the ire of some regulators.
New York State Attorney General Andrew Cuomo, who is conducting an ongoing inquiry into executive compensation at Wall Street firms, has been asking firms to scrap their bonuses this year.
Merrill Lynch shareholders on Friday approved the brokerage’s acquisition by Bank of America Corp., creating the largest US financial services company. Thain ushered through the combination in September at fire sale prices to avoid a collapse similar to that of Lehman Brothers.
Tuesday, December 9, 2008
Cognizant posts good results, but weak forecast
Technology and outsourcing services company, Cognizant Technology Solutions Corp., reported good results for the September quarter, with revenues increasing by 7.2% compared with the previous three months, and operating profit rising by as much as 19.2%.
The growth in profit was aided by a favourable foreign exchange movement and sharp increase in employee utilization. But that doesn’t take away from the fact that underlying business growth has also been decent. Much has been said about the company’s high exposure (46%) to banking and financial services, but this segment continues to grow at a rate that’s higher than the company average.
But the good news stops with the September quarter results. The guidance for the December quarter, in fact, has been lowered.
Based on the forecast three months ago, the company had estimated revenues of $723 million (Rs3,449 crore today) in the September quarter and $758.5 million in the December quarter.
While it easily beat its guidance for the September quarter by reporting revenues of $734.7 million, the target for the December quarter has been lowered to $746.7 million.
The management told analysts in a conference call that “we want to maintain some caution on expectations for growth next quarter”.
While the current economic environment is the main reason for caution, the company is also facing other headwinds such as adverse currency movements relating to revenues it earns in Europe. Because of the sharp fall of European currencies, revenues from this region get impacted when converted into dollars, the functional currency for the US-headquartered company.
Still, some analysts tracking the firm are worried about the low growth guidance for the December quarter. The forecast assumes year-on-year revenue growth rate of just 24.4%, the lowest since the second quarter of fiscal year 2001-02, or the worst since the technology bust.
The company has also said clients’ budget-making process should get postponed by two-three months, and the pick-up in spending it normally sees during the December quarter is not expected to happen this time around.
Some analysts have lowered forecasts for the next year based on these statements and the negative news on the economic environment. They are now talking of a revenue growth rate of about 15% for next year. Bank of America Securities, for instance, has lowered revenue growth estimate for 2009 to 15.8%, from 25.8% earlier.
In the past few years, Cognizant has been growing at a rate that’s about 10 percentage points higher than the industry. Even this year, while the industry is expected to grow by about 20%, Cognizant is all set to achieve a growth of 32%.
The moot question is if Cognizant grows at just 15% next year, as some US analysts are now predicting, how low could other Indian IT players go?
The growth in profit was aided by a favourable foreign exchange movement and sharp increase in employee utilization. But that doesn’t take away from the fact that underlying business growth has also been decent. Much has been said about the company’s high exposure (46%) to banking and financial services, but this segment continues to grow at a rate that’s higher than the company average.
But the good news stops with the September quarter results. The guidance for the December quarter, in fact, has been lowered.
Based on the forecast three months ago, the company had estimated revenues of $723 million (Rs3,449 crore today) in the September quarter and $758.5 million in the December quarter.
While it easily beat its guidance for the September quarter by reporting revenues of $734.7 million, the target for the December quarter has been lowered to $746.7 million.
The management told analysts in a conference call that “we want to maintain some caution on expectations for growth next quarter”.
While the current economic environment is the main reason for caution, the company is also facing other headwinds such as adverse currency movements relating to revenues it earns in Europe. Because of the sharp fall of European currencies, revenues from this region get impacted when converted into dollars, the functional currency for the US-headquartered company.
Still, some analysts tracking the firm are worried about the low growth guidance for the December quarter. The forecast assumes year-on-year revenue growth rate of just 24.4%, the lowest since the second quarter of fiscal year 2001-02, or the worst since the technology bust.
The company has also said clients’ budget-making process should get postponed by two-three months, and the pick-up in spending it normally sees during the December quarter is not expected to happen this time around.
Some analysts have lowered forecasts for the next year based on these statements and the negative news on the economic environment. They are now talking of a revenue growth rate of about 15% for next year. Bank of America Securities, for instance, has lowered revenue growth estimate for 2009 to 15.8%, from 25.8% earlier.
In the past few years, Cognizant has been growing at a rate that’s about 10 percentage points higher than the industry. Even this year, while the industry is expected to grow by about 20%, Cognizant is all set to achieve a growth of 32%.
The moot question is if Cognizant grows at just 15% next year, as some US analysts are now predicting, how low could other Indian IT players go?
Home loans to be locked in at 9.5% for first 5 years
Public sector banks (PSBs) are set to offer home loans of up to Rs20 lakh at a concessional rate of 9.5% for a period of five years as part of the government’s fiscal stimulus package announced on Sunday to spur spending and bolster sagging economic growth.
All new home loans advanced by state-owned banks until 30 June will come at the 9.5% rate, which will be reset five years later depending on the prevailing trend, according to two senior bankers involved in devising the package who didn’t want to be named.
A formal announcement of the scheme will be made soon by public sector banks. Two officials at two different ministries, who also didn’t want to be named, confirmed the plan.
Housing is one of the key areas on which the government is focusing to lift economic growth that’s slowing from an average annual pace of 8.9% in the past four years. Lower interest rates prop up the demand for homes, which in turn, creates demand for steel and cement and generates jobs in the construction sector.
Banks and housing finance firms are now charging between 12% and 14% for fixed-rate home loans and offering floating-rate mortgages at between 9.5% and 11.75%.
Because the cost of funds for banks currently is higher than the rate at which they will offer loans under the new scheme, the government may work out an arrangement to compensate the lenders, analysts say.
It is not clear what will be the nature of the arrangement but “certainly not subvention”, said one banker. The government offers 3% subvention—or interest subsidy—on small agricultural loans, which are given at a concessional rate of 7%.
The Reserve Bank of India’s (RBI) decision on Saturday to include home loans of up to Rs20 lakh in so-called priority sector lending—targeted at segments such as agriculture, small industry and education—will come in handy for banks to offer mortgages at a concessional rate.
Under banking industry guidelines, 40% of advances are meant to be channelled to the priority sector. Banks that are not able to meet the target are required to park the shortfall with the National Bank for Agriculture and Rural Development at a low interest rate. The money is used for rural infrastructure projects. Analysts say the five-year fixed rate of 9.5% will dent banks’ profitability if the government doesn’t offer a support plan for lenders in case interest rates remain at this level or rise further. But if interest rates drop, consumers will lose out on the benefit of falling rates.
“If interest rates fall and home loan rates come down below 9.5%, we will have to watch what exit options this package would provide. Many questions of potential borrowers might have to be answered before they go ahead and avail of such loans,” said Ravi Sankar, a banking analyst at Antique Stock Broking Ltd, a Mumbai-based brokerage.
The asset quality of banks might be compromised if they try to push the scheme aggressively, Sankar said.
“This rate is quite attractive for borrowers at the moment,” said Hatim Brochwala, an analyst at Khandwala Securities Ltd, another domestic brokerage. “However, if interest rates fall and home loan rates become cheaper, borrowers might start complaining. So, the banks will have to chalk out an exit plan. Converting fixed rate into floating rate (loans) may not be a good option as the penalty is heavy.”
Analysts are betting that interest rates will come down by 300 basis points in two years and home loan rates will be cheaper than 9.5%. One basis point is one-hundredth of a percentage point.
On Saturday, the RBI announced a special refinancing package of Rs4,000 crore to the National Housing Bank, which regulates housing finance firms, to help prop up the home loan market. Analysts say the refinancing facility is too small.
Housing Development Finance Corp. Ltd (HDFC), India’s oldest mortgage firm, has a disbursal target of about Rs45,000 crore this year. While HDFC accounts for at least 40% of the housing loan market, public sector banks make up about 20%, limiting the scope of the stimulus package, analysts say. ICICI Bank Ltd, India’s largest private sector bank, is a prominent lender in the mortgage market.
All new home loans advanced by state-owned banks until 30 June will come at the 9.5% rate, which will be reset five years later depending on the prevailing trend, according to two senior bankers involved in devising the package who didn’t want to be named.
A formal announcement of the scheme will be made soon by public sector banks. Two officials at two different ministries, who also didn’t want to be named, confirmed the plan.
Housing is one of the key areas on which the government is focusing to lift economic growth that’s slowing from an average annual pace of 8.9% in the past four years. Lower interest rates prop up the demand for homes, which in turn, creates demand for steel and cement and generates jobs in the construction sector.
Banks and housing finance firms are now charging between 12% and 14% for fixed-rate home loans and offering floating-rate mortgages at between 9.5% and 11.75%.
Because the cost of funds for banks currently is higher than the rate at which they will offer loans under the new scheme, the government may work out an arrangement to compensate the lenders, analysts say.
It is not clear what will be the nature of the arrangement but “certainly not subvention”, said one banker. The government offers 3% subvention—or interest subsidy—on small agricultural loans, which are given at a concessional rate of 7%.
The Reserve Bank of India’s (RBI) decision on Saturday to include home loans of up to Rs20 lakh in so-called priority sector lending—targeted at segments such as agriculture, small industry and education—will come in handy for banks to offer mortgages at a concessional rate.
Under banking industry guidelines, 40% of advances are meant to be channelled to the priority sector. Banks that are not able to meet the target are required to park the shortfall with the National Bank for Agriculture and Rural Development at a low interest rate. The money is used for rural infrastructure projects. Analysts say the five-year fixed rate of 9.5% will dent banks’ profitability if the government doesn’t offer a support plan for lenders in case interest rates remain at this level or rise further. But if interest rates drop, consumers will lose out on the benefit of falling rates.
“If interest rates fall and home loan rates come down below 9.5%, we will have to watch what exit options this package would provide. Many questions of potential borrowers might have to be answered before they go ahead and avail of such loans,” said Ravi Sankar, a banking analyst at Antique Stock Broking Ltd, a Mumbai-based brokerage.
The asset quality of banks might be compromised if they try to push the scheme aggressively, Sankar said.
“This rate is quite attractive for borrowers at the moment,” said Hatim Brochwala, an analyst at Khandwala Securities Ltd, another domestic brokerage. “However, if interest rates fall and home loan rates become cheaper, borrowers might start complaining. So, the banks will have to chalk out an exit plan. Converting fixed rate into floating rate (loans) may not be a good option as the penalty is heavy.”
Analysts are betting that interest rates will come down by 300 basis points in two years and home loan rates will be cheaper than 9.5%. One basis point is one-hundredth of a percentage point.
On Saturday, the RBI announced a special refinancing package of Rs4,000 crore to the National Housing Bank, which regulates housing finance firms, to help prop up the home loan market. Analysts say the refinancing facility is too small.
Housing Development Finance Corp. Ltd (HDFC), India’s oldest mortgage firm, has a disbursal target of about Rs45,000 crore this year. While HDFC accounts for at least 40% of the housing loan market, public sector banks make up about 20%, limiting the scope of the stimulus package, analysts say. ICICI Bank Ltd, India’s largest private sector bank, is a prominent lender in the mortgage market.
US media giant Tribune files for bankruptcy
The Tribune Co., owner of the Los Angeles Times, The Chicago Tribune and other dailies, filed for bankruptcy on Monday, in the latest blow to a newspaper industry reeling from a drop in advertising and the rise of online media.
The Chicago-based company said it was forced to seek bankruptcy protection because of a sharp drop in revenue and a $13 billion debt load but has enough cash to sustain operations while it restructures.
It said the Chicago Cubs baseball franchise and its iconic stadium, Wrigley Field, were not included in the Chapter 11 bankruptcy filing, which protects the company from its creditors while it restructures, and the Tribune would continue to try to find a buyer for the team.
The Tribune’s eight newspapers, 23 television stations and interactive properties will continue to operate during the reorganization, the company stressed, adding that it “has sufficient cash to do so.”
“This restructuring focuses on our debt, not on our operations,” said Tribune chairman and chief executive Sam Zell, the Chicago real-estate titan who led the 2007 private equity buyout of the Tribune Co.
Tribune is the second-largest US newspaper publisher in terms of revenue and the third in terms of circulation.
Besides the Los Angeles Times, which has slashed its editorial staff from 1,200 in 2001 to 660 today, it owns the Chicago Tribune, Baltimore Sun, Orlando Sentinel, Hartford Courant and several other papers.
According to US media reports, its cash flow is not enough to cover one billion dollars in interest payments due this year and a $512 million debt payment due in June.
The Tribune said that in the year since it went private it has repaid approximately $1 billion of its senior credit facility and has been “rewriting the business model for its media assets.”
Like many US newspapers, the Tribune has been grappling with declining circulation, a loss of readership to online media, and a steep drop in print advertising revenue.
Many advertisers have been shifting their dollars to the Web but gains in online advertising revenue have failed to keep pace with losses on the print side.
According to the Audit Bureau of Circulations, circulation for 507 daily US newspapers fell 4.64% in the six months to September.
US media company EW Scripps Co., which owns newspapers in 15 US markets and 10 television stations, announced 400 job cuts last month and has put one of its flagship papers, the Rocky Mountain News, up for sale.
Another debt-ridden major newspaper chain, McClatchy Co., has carried out a series of layoffs this year and, according to the New York Times, is seeking to sell one of its flagship newspapers, The Miami Herald.
Gannett Co., the largest US newspaper chain, publishing USA Today and 84 other newspapers, announced 1,000 job cuts in August and is currently laying off another 10% of its workforce.
The prestigious New York Times itself has not been immune to the crisis gripping the newspaper industry.
The paper reported Monday that the New York Times Co. plans to borrow up to $225 million against its mid-Manhattan headquarters building to ease a potential cash flow squeeze.
Tribune Co. reported a loss of $124 million in the third quarter, compared with a net profit of 84 million dollars a year earlier.
The company has undertaken a series of moves in a bid to ease its debt burden in addition to seeking a buyer for the Chicago Cubs.
In May, it sold its stake in the New York newspaper Newsday for $650 million and in October it said it had informed the Associated Press it plans to terminate its contract with the US news agency in two years.
The Chicago firm traces its history to 1847 with the birth of the Chicago Tribune. It became a publicly traded company only in 1983.
In 2000, the Tribune bought the Times-Mirror group, including the flagship Los Angeles Times, for $8.3 billion in what was then the largest acquisition ever in the US newspaper industry.
The Chicago-based company said it was forced to seek bankruptcy protection because of a sharp drop in revenue and a $13 billion debt load but has enough cash to sustain operations while it restructures.
It said the Chicago Cubs baseball franchise and its iconic stadium, Wrigley Field, were not included in the Chapter 11 bankruptcy filing, which protects the company from its creditors while it restructures, and the Tribune would continue to try to find a buyer for the team.
The Tribune’s eight newspapers, 23 television stations and interactive properties will continue to operate during the reorganization, the company stressed, adding that it “has sufficient cash to do so.”
“This restructuring focuses on our debt, not on our operations,” said Tribune chairman and chief executive Sam Zell, the Chicago real-estate titan who led the 2007 private equity buyout of the Tribune Co.
Tribune is the second-largest US newspaper publisher in terms of revenue and the third in terms of circulation.
Besides the Los Angeles Times, which has slashed its editorial staff from 1,200 in 2001 to 660 today, it owns the Chicago Tribune, Baltimore Sun, Orlando Sentinel, Hartford Courant and several other papers.
According to US media reports, its cash flow is not enough to cover one billion dollars in interest payments due this year and a $512 million debt payment due in June.
The Tribune said that in the year since it went private it has repaid approximately $1 billion of its senior credit facility and has been “rewriting the business model for its media assets.”
Like many US newspapers, the Tribune has been grappling with declining circulation, a loss of readership to online media, and a steep drop in print advertising revenue.
Many advertisers have been shifting their dollars to the Web but gains in online advertising revenue have failed to keep pace with losses on the print side.
According to the Audit Bureau of Circulations, circulation for 507 daily US newspapers fell 4.64% in the six months to September.
US media company EW Scripps Co., which owns newspapers in 15 US markets and 10 television stations, announced 400 job cuts last month and has put one of its flagship papers, the Rocky Mountain News, up for sale.
Another debt-ridden major newspaper chain, McClatchy Co., has carried out a series of layoffs this year and, according to the New York Times, is seeking to sell one of its flagship newspapers, The Miami Herald.
Gannett Co., the largest US newspaper chain, publishing USA Today and 84 other newspapers, announced 1,000 job cuts in August and is currently laying off another 10% of its workforce.
The prestigious New York Times itself has not been immune to the crisis gripping the newspaper industry.
The paper reported Monday that the New York Times Co. plans to borrow up to $225 million against its mid-Manhattan headquarters building to ease a potential cash flow squeeze.
Tribune Co. reported a loss of $124 million in the third quarter, compared with a net profit of 84 million dollars a year earlier.
The company has undertaken a series of moves in a bid to ease its debt burden in addition to seeking a buyer for the Chicago Cubs.
In May, it sold its stake in the New York newspaper Newsday for $650 million and in October it said it had informed the Associated Press it plans to terminate its contract with the US news agency in two years.
The Chicago firm traces its history to 1847 with the birth of the Chicago Tribune. It became a publicly traded company only in 1983.
In 2000, the Tribune bought the Times-Mirror group, including the flagship Los Angeles Times, for $8.3 billion in what was then the largest acquisition ever in the US newspaper industry.
Sunday, December 7, 2008
Govt unveils Rs 20,000 cr plan to boost economy
In a virtual mini-budget, the government on Sunday slashed Cenvat by
four per cent across the board to boost demand and announced Rs 20,000
crore additional non-plan expenditure as part of package to stimulate
the economy, hit hard by the global financial crisis.
The much anticipated package, set rolling by Prime Minister Manmohan
singh who is also the Finance Minister, targets to power exports,
housing, auto, small and medium industries and infrastructure sectors
through additional funding and guarantees that a total amount of about
Rs 35,000 crore.
The 10-point package contains substantial incentives for the sectors
that have been hit by the global slowdown and recession in the west,
besides allowing India Infrastructure Finance Company Ltd to raise Rs
10,000 crore through tax free bonds by March as part of efforts to
support Rs 1,00,000 crore programme in the high-way sector.
"The government has been concerned about the impact of the global
financial crisis on the Indian economy and a number of steps have been
taken to deal with this problem," an official statement said in New
Delhi.
The steps taken by the RBI to pump sufficient liquidity in the
financial system are being "supplemented by fiscal measures designed
to stimulate the economy. In recognition of the need for a fiscal
stimulus the government had consciously allowed the fiscal deficit to
expand beyond the originally targeted level".
As part of steps to create demand in the economy that is expected to
grow by over seven per cent, "the total spending programme in the
balance four months of the current fiscal year, taking plan and non-
plan expenditure together is expected to be Rs 3,00,000 crore."
Reflecting high priority for the exports, which for the first time in
five years recorded a negative growth at 12 per cent, the government
provided Rs 1,450 crore toward refund of excise duty and incentives,
besides giving a guarantee of Rs 350 crore for difficult market and
product exports.
To bring down the cost of exports, hit by a sharp devaluation of rupee
in the recent months, the government also offered a two per cent
interest subsidy for labour intensive products like textiles, leather
and SMEs, subject to a minimum interest of seven per cent.
It said, "As an immediate measure to spur additional spending, an
across-the-board cut of four per cent in the ad-valorem Cenvat rate
will be effected for the balance part of the current fiscal on all
products other than petroleum and those where the current rate is less
four per cent."
The public sector banks will soon announce a package for borrowers of
home loans up to Rs five lakh and between Rs five lakhs to Rs 20
lakhs, the statement said adding that additional measures would be
taken as necessary to promote an accelerated growth trajectory in the
housing sector.
Stating that RBI has already announced a Rs 4,000 crore refinance
facility for the National Housing Bank, government said that the low
cost Indira Awas Yojna is another area where plan expenditure can be
increased easily.
Terming as "critical" the medium, small and micro enterprises (MSMEs)
for job creation, the government sought to boost the collateral-free
lending on loans from Rs fifty lakh to Rs one crore with guarantee
cover of 50 per cent.
Besides, the lock in period for loans under existing credit guarantee
scheme are being cut from 24 to 18 months, a move that would encourage
banks to give more loans to the sector, the government said, adding
that PSUs are being asked to ensure prompt payment of bills to MSMEs.
four per cent across the board to boost demand and announced Rs 20,000
crore additional non-plan expenditure as part of package to stimulate
the economy, hit hard by the global financial crisis.
The much anticipated package, set rolling by Prime Minister Manmohan
singh who is also the Finance Minister, targets to power exports,
housing, auto, small and medium industries and infrastructure sectors
through additional funding and guarantees that a total amount of about
Rs 35,000 crore.
The 10-point package contains substantial incentives for the sectors
that have been hit by the global slowdown and recession in the west,
besides allowing India Infrastructure Finance Company Ltd to raise Rs
10,000 crore through tax free bonds by March as part of efforts to
support Rs 1,00,000 crore programme in the high-way sector.
"The government has been concerned about the impact of the global
financial crisis on the Indian economy and a number of steps have been
taken to deal with this problem," an official statement said in New
Delhi.
The steps taken by the RBI to pump sufficient liquidity in the
financial system are being "supplemented by fiscal measures designed
to stimulate the economy. In recognition of the need for a fiscal
stimulus the government had consciously allowed the fiscal deficit to
expand beyond the originally targeted level".
As part of steps to create demand in the economy that is expected to
grow by over seven per cent, "the total spending programme in the
balance four months of the current fiscal year, taking plan and non-
plan expenditure together is expected to be Rs 3,00,000 crore."
Reflecting high priority for the exports, which for the first time in
five years recorded a negative growth at 12 per cent, the government
provided Rs 1,450 crore toward refund of excise duty and incentives,
besides giving a guarantee of Rs 350 crore for difficult market and
product exports.
To bring down the cost of exports, hit by a sharp devaluation of rupee
in the recent months, the government also offered a two per cent
interest subsidy for labour intensive products like textiles, leather
and SMEs, subject to a minimum interest of seven per cent.
It said, "As an immediate measure to spur additional spending, an
across-the-board cut of four per cent in the ad-valorem Cenvat rate
will be effected for the balance part of the current fiscal on all
products other than petroleum and those where the current rate is less
four per cent."
The public sector banks will soon announce a package for borrowers of
home loans up to Rs five lakh and between Rs five lakhs to Rs 20
lakhs, the statement said adding that additional measures would be
taken as necessary to promote an accelerated growth trajectory in the
housing sector.
Stating that RBI has already announced a Rs 4,000 crore refinance
facility for the National Housing Bank, government said that the low
cost Indira Awas Yojna is another area where plan expenditure can be
increased easily.
Terming as "critical" the medium, small and micro enterprises (MSMEs)
for job creation, the government sought to boost the collateral-free
lending on loans from Rs fifty lakh to Rs one crore with guarantee
cover of 50 per cent.
Besides, the lock in period for loans under existing credit guarantee
scheme are being cut from 24 to 18 months, a move that would encourage
banks to give more loans to the sector, the government said, adding
that PSUs are being asked to ensure prompt payment of bills to MSMEs.
Friday, December 5, 2008
Pre Market Report 05/12/2008
The market may extend Thursdayâ€(TM)s (4 December 2008) solid gains on expectations of a stimulus package from the government and the Reserve Bank of India (RBI). However, Indo-Pak tension after the major terror strikes in Mumbai last week, will cap the upside.
The BSE Sensex rose 5.5% on Thursday to its highest close in more than two weeks as expectations for an interest rate cut received a boost from slower-than-expected rise in inflation. As per the provisional data released by the stock exchanges, foreign funds bought shares worth a net Rs 307.14 crore and domestic funds purchases shares worth a net Rs 79.24 crore on Thursday.
As per the market buzz, the Reserve Bank of India (RBI) is expected to cut repo and reverse repo rates to the extent of 200 basis points and 125 basis points respectively on Saturday, 6 December 2008, in an attempt to shield the domestic economy from the global economic slowdown. Repo rate is the rate at which RBI lends to commercial banks and reverse repo rate is the rate at which RBI accepts deposits from banks.
Inflation based on the wholesale price index rose 8.4% in the year through 22 November 2008, lower than previous week's 8.84% rise, data released by the government on Thursday, showed. Inflation had surged into double digits in early June this year after an increase in state-set retail fuel prices, and peaked at 12.91% on, 2 August 2008, the highest reading since annual numbers in the current data series became available in April 1995.
Meanwhile, the Indian government is slated to announce a slew of measures on Saturday to pump prime the economy. The likely measures include a Rs 2000-crore export package, a further relaxation in external commercial borrowings norms and Rs 15,000-crore budgetary support for infrastructure.
The Indian government is reportedly considering various options including a strike on Pakistan to dismantle its terror bases in response to the recent Mumbai terror attacks. As a strike on Pakistan could lead to a full scale war between the two nuclear armed countries, India is maintaining a cautious approach and wants to gauge every possible ramification of its decision, reports suggest.
Tension between India and Pakistan have mounted after the Mumbai attacks. India has blamed Islamist militants based in Pakistan for the attacks.
Asian stocks were mostly in the green on Friday, 5 December 2008 following record rate cuts by central banks in Europe. But caution prevail ahead of what is expected to be dismal US employment data due later in the day.
The BSE Sensex rose 5.5% on Thursday to its highest close in more than two weeks as expectations for an interest rate cut received a boost from slower-than-expected rise in inflation. As per the provisional data released by the stock exchanges, foreign funds bought shares worth a net Rs 307.14 crore and domestic funds purchases shares worth a net Rs 79.24 crore on Thursday.
As per the market buzz, the Reserve Bank of India (RBI) is expected to cut repo and reverse repo rates to the extent of 200 basis points and 125 basis points respectively on Saturday, 6 December 2008, in an attempt to shield the domestic economy from the global economic slowdown. Repo rate is the rate at which RBI lends to commercial banks and reverse repo rate is the rate at which RBI accepts deposits from banks.
Inflation based on the wholesale price index rose 8.4% in the year through 22 November 2008, lower than previous week's 8.84% rise, data released by the government on Thursday, showed. Inflation had surged into double digits in early June this year after an increase in state-set retail fuel prices, and peaked at 12.91% on, 2 August 2008, the highest reading since annual numbers in the current data series became available in April 1995.
Meanwhile, the Indian government is slated to announce a slew of measures on Saturday to pump prime the economy. The likely measures include a Rs 2000-crore export package, a further relaxation in external commercial borrowings norms and Rs 15,000-crore budgetary support for infrastructure.
The Indian government is reportedly considering various options including a strike on Pakistan to dismantle its terror bases in response to the recent Mumbai terror attacks. As a strike on Pakistan could lead to a full scale war between the two nuclear armed countries, India is maintaining a cautious approach and wants to gauge every possible ramification of its decision, reports suggest.
Tension between India and Pakistan have mounted after the Mumbai attacks. India has blamed Islamist militants based in Pakistan for the attacks.
Asian stocks were mostly in the green on Friday, 5 December 2008 following record rate cuts by central banks in Europe. But caution prevail ahead of what is expected to be dismal US employment data due later in the day.
Oil slips below $44, lowest in 4 years
Oil was steady below $44 on Friday, at its lowest in almost four years, with eyes turning to the psychologically important $40 level as a widening economic slowdown gnaws into oil demand.
Prices have lost nearly 20%, or almost $11, from their settlement a week ago following the release of weak US economic indicators, with lower retail sales and a 26-year high in jobless benefits rolls the latest to add pressure to prices.
US light crude for January delivery fell 4 cents to $43.63 a barrel, having lost more than 6% on Thursday to settle at $43.67, the lowest since 5 January, 2005.
London Brent crude dipped 8 cents to $42.20.
The number of US workers collecting jobless benefits hit a 26-year high last month, data showed on Thursday, and may head higher as a growing economic slump forces a broad range of firms to cut jobs.
US and European companies announced further job cuts, with US phone company AT&T Inc saying it would eliminate 12,000 jobs, while chemical maker DuPont Co planned to drop 2,500.
Leading US retailers also reported dismal November sales on Thursday. Totting up the results, the International Council of Shopping Centers said sales fell by a record 2.7% compared to the same period last year.
To try and ginger up their feeble economies, European central banks cut interest rates on Thursday.
Sweden’s central bank cut by a record 175 basis points, the European Central Bank cut by 75 points and the Bank of England cut by 100 points.
The price fall to nearly four-year lows has prompted Opec members to call for increasingly strong action when the Organization of the Petroleum Exporting Countries meets next, on 17 December in Algeria.
But analysts say another Opec cut, the third since September, would need to be drastic to provoke a price reaction.
Prices have lost nearly 20%, or almost $11, from their settlement a week ago following the release of weak US economic indicators, with lower retail sales and a 26-year high in jobless benefits rolls the latest to add pressure to prices.
US light crude for January delivery fell 4 cents to $43.63 a barrel, having lost more than 6% on Thursday to settle at $43.67, the lowest since 5 January, 2005.
London Brent crude dipped 8 cents to $42.20.
The number of US workers collecting jobless benefits hit a 26-year high last month, data showed on Thursday, and may head higher as a growing economic slump forces a broad range of firms to cut jobs.
US and European companies announced further job cuts, with US phone company AT&T Inc saying it would eliminate 12,000 jobs, while chemical maker DuPont Co planned to drop 2,500.
Leading US retailers also reported dismal November sales on Thursday. Totting up the results, the International Council of Shopping Centers said sales fell by a record 2.7% compared to the same period last year.
To try and ginger up their feeble economies, European central banks cut interest rates on Thursday.
Sweden’s central bank cut by a record 175 basis points, the European Central Bank cut by 75 points and the Bank of England cut by 100 points.
The price fall to nearly four-year lows has prompted Opec members to call for increasingly strong action when the Organization of the Petroleum Exporting Countries meets next, on 17 December in Algeria.
But analysts say another Opec cut, the third since September, would need to be drastic to provoke a price reaction.
Post Market Report:04/12/2008
Likely government measures to pump prime the economy, hopes of a
further cut in interest rates, firm European stocks and rebound in
US index futures boosted the domestic bourses today. The BSE
30-share Sensex jumped 482.32 points, or 5.51%, led by a surge in
realty, metal, banking shares and index heavyweight Reliance
Industries (RIL). The barometer index breached the psychological
9,000 mark. All the sectoral indices on BSE were in the green.
Bank shares were in demand on as falling inflation heightened
expectations for an interest rate cute by the Reserve Bank of India
(RBI). As per the market buzz, the Reserve Bank of India (RBI) is
expected to cut repo and reverse repo rates to the extent of 200
basis points and 125 basis points respectively at the weekend, in
an attempt to shield the domestic economy from the global economic
slowdown. Repo rate is the rate at which RBI lends to commercial
banks and reverse repo rate is the rate at which RBI accepts
deposits from banks.
Inflation based on the wholesale price index rose 8.4% in the year
through 22 November 2008, lower than previous week's 8.84% rise,
data released by the government at about 13:15 IST showed.
Inflation had surged into double digits in early June this year
after an increase in state-set retail fuel prices, and peaked at
12.91% on, 2 August 2008, the highest reading since annual numbers
in the current data series became available in April 1995.
Reserve Bank of India (RBI) governor D Subbarao today, 4 December
2008, said India remains vulnerable to global financial and
economic developments and a period of painful adjustment was
inevitable. The RBI governor said India's economic fundamentals
were strong. He added that the outlook for India was mixed and
there was evidence of activity slowing down.
Meanwhile, the Indian government is slated to announce a slew of
measures at the weekend to pump prime the economy. The likely
measures include a Rs 2000-crore export package, a further
relaxation in external commercial borrowings norms and Rs
15,000-crore budgetary support for infrastructure.
A bout of volatility was witnessed earlier in the day. Likely
government measures to pump prime the economy and hopes of further
rate cuts by the Reserve bank of India gave a positive start to the
domestic bourses. But the market soon slipped into the red due to
lower US index futures, concerns about the weakening global economy
and due to tension between Indian and Pakistan following last
week's terror attacks in Mumbai may cap the upside. The market
firmed up again in early trade. After the recovery, the market
pared gains before bouncing back again. Sensex swung 518.35 points
between the day's high and low.
European stocks reversed early losses to rally on Thursday, 4
December 2008, rising for the third session in a row as investors
hoped deep interest rate cuts would help soothe the global economic
slump. The key benchmark indices in France, Germany and UK were up
by between 0.54% to 2.62%.
The Bank of England slashed interest rates by a full percentage
point today to shore up Britain's crumbling economy and head off
the threat of deflation. The cut took rates to 2% their lowest
level since 1951. The central bank in Sweden slashed its key
interest rate by a record 175 basis points to 2% on Thursday, a
shock move to try and prevent the economy from sliding deeper into
recession.
At its policy meeting later in the day, the European Central Bank
(ECB) is expected to cut rates by at least 75 basis points.
Meanwhile, economic, corporate and industry data continues to be
weak in major economies. Japan said on Thursday, 4 December 2008,
it may be in a deeper recession than first thought, in the latest
signal that the global economic downturn is sparing few corners of
the world. Earlier, a corporate survey in Japan signaled the
country's economic performance in the third quarter may have been
even worse than first reported. Australia's vehicle sales slumped
in November 2008.
US data on Wednesday, 3 December 2008, showed large job losses by
US employers and a slumping service sector. The US economy is
already in recession for a year.
Swiss Bank Credit Suisse today, 4 December 2008, reported a net
loss of about 3 billion Swiss francs ($2.5 billion) in the two
months to end-November 2008 and cut another 5,300 jobs.
Trading in US index futures indicated the Dow could rise 23 points
at the opening bell. The US index futures bounced back from steep
losses earlier in the day.
Closer home, the Indian government is reportedly considering
various options including a strike on Pakistan to dismantle its
terror bases in response to the recent Mumbai terror attacks. As a
strike on Pakistan could lead to a full scale war between the two
nuclear armed countries, India is maintaining a cautious approach
and wants to gauge every possible ramification of its decision,
reports suggest.
Tension between India and Pakistan have mounted after the Mumbai
attacks. India has blamed Islamist militants based in Pakistan for
the attacks.
The BSE 30-share Sensex was up 482.32 points, or 5.51%, to
9,229.75. At the day's high of 9,245.06 hit in late trade, the
Sensex rose 497.63 points. The Sensex lost 20.72 points at the
day's low of 8,726,71 hit in early trade.
The S&P CNX Nifty was up 131.55 points, or 4.95%, to 2,788.
The market breadth, indicating the overall health of the market,
was strong. On BSE, 1,503 shares rose as compared with 668 that
declined. 60 shares remained unchanged.
The BSE clocked a turnover of Rs 3727 crore today, higher than Rs
2,955.08 crore on Wednesday, 3 December 2008.
Nifty December 2008 futures were at 2796, at a premium of 8 points
as compared to the spot closing of 2788. Turnover in NSE's futures
& options (F&O) segment rose to Rs 34,123.92 crore from Rs
33,606.23 crore on Wednesday, 3 December 2008.
The barometer index BSE Sensex is down 11,057.24 points or 54.5% in
the calendar year 2008 so far from its close of 20,286.99 on 31
December 2007. It is 11,977.02 points or 56.47% below its all-time
high of 21,206.77 struck on 10 January 2008.
The BSE Realty index (up 12.44% to 1,753.65), the BSE Metal index
(up 7.93% to 4,803.91), the BSE Capital Goods index (up 6.91% to
6,506.98), the BSE Oil & Gas index (up 5.86% to 5,682.68), the BSE
Power index (up 5.7% to 1,676.43), the BSE Bankex (up 5.64% to
4,803.37) outperformed the Sensex.
The BSE HealthCare index (up 0.92% to 2,849.12), the BSE Consumer
Durables index (up 1.21% to 1,734.53), the BSE IT index (up 2.69%
to 2,464.74), the BSE FMCG index (up 2.8% to 1,954.75), the BSE
Auto index (up 3.22% to 2,243.11), the BSE Teck index (up 3.32% to
1,982.39) and the BSE PSU index (up 3.71% to 4,667.57),
underperformed the Sensex.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) surged 8.4% to Rs 1,159.30 on
recent reports it intends to restart retailing of petrol and diesel
soon after margins on the two fuels turned positive.
Realty stocks rose on reports the government will next week unveil
measures for the realty sector, which may include incentives for
low-cost housing and lower loan rates. Indiabulls Real Estate, DLF,
Unitech rose by between 11.28% to 17.17%.
Metal stocks rebounded from earlier slide on recovery in metal
prices on the London Metal Exchange (LME). Tata Steel, Hindalco
Industries, Sterlite Industries, Steel Authority of India, National
aluminum Company rose by between 2.65% to 13.84%.
Banking stocks edged higher on rate cut hopes. India's largest
private sector bank by net profit ICICI Bank rose 8.75% as American
depository receipt (ADR) gained 5.64% on Wednesday, 3 December
2008. India's largest commercial bank State Bank of India (SBI)
jumped 6.55%. India's second largest private sector bank by net
profit HDFC Bank gained 3.52% as ADR rose 2.6% on Wednesday.
Shares of housing finance firms rose on likely sops for the realty
sector, which may include incentives for low-cost housing and lower
loan rates. India's top mortgage lender by market capitalisation
Housing Development Finance Corporation (HDFC) rose 6.76% and
India's second-biggest mortgage lender by market capitalisation LIC
Housing Finance rose 10.37%.
Infrastructure Development Finance Company jumped 14.29% after a
block deal of 17.01 lakh shares was executed on BSE at Rs 58.50 per
share.
Indian Overseas Bank rose 3.04% after a block deal of ten lakh
shares was executed on BSE at Rs 67 per share.
IT stocks shrugged off a stronger rupee after India's second
largest IT exporter by sales Infosys' chief executive S.
Gopalakrishnan today, 4 December 2008, said though the company has
seen delays in orders there is no change in its third quarter
December 2008 guidance. Infosys rose 3.12%, recovering from a 4.29%
fall in the previous trading session.
India's fourth largest IT exporter by sales Wipro gained 4.71% as
ADR rose 1.95%. India's third largest IT exporter by sales Satyam
Computer Services rose 1.04% as ADR gained 2.43% on Wednesday, 3
December 2008. India's largest IT exporter by sales Tata
Consultancy Services rose 2.82%.
The Indian rupee was stronger in afternoon trade on Thursday as
hefty gains in the domestic share market raised expectations of
fresh capital inflows while a drop in oil prices also eased
concerns of a widening trade deficit. The partially convertible
rupee was at 49.78/80 per dollar, stronger than its Wednesday's
close of 49.99/50.01. On Tuesday, the rupee had hit a record low of
50.65. A stronger rupee affects IT firms negatively as they earn
most of their revenues from exports.
Auto stocks rose on hopes lower interest rates will spur demand
which is mainly driven by finance and on possible measures by the
government to boost the commercial vehicles sector. Mahindra &
Mahindra, Maruti Suzuki India and Hero Honda Motors rose by between
0.56% to 4.74%.
India's largest commercial vehicle maker by sales Tata Motors up
13.29% on reports of possible excise duty cut on commercial
vehicles as a part of the government's package to boost the
economy.
Capital goods stocks rose on hopes government efforts to boost
economy will lift orders. Larsen & Toubro, Suzlon Energy, Bharat
Heavy Electricals, Crompton Greaves and Thermax rose by between
2.87% to 10.24%.
Power stocks rose on reports the likely government measures to
boost the economy may include special credit window for the power
sector. Tata Power Company, Reliance Infrastructure, Reliance
Power, Power Grid Corporation of India jumped by between 3.21% to
7.46%.
India's largest drug maker by sales Ranbaxy Laboratories rose 3.57%
on signing a pact with a US drug firm.
Orchid Chemicals & Pharmaceuticals rose 2.51% on receiving US
approval for a new drug.
Infrastructure stocks extended gains for the second day in a row on
hopes a likely government package to boost the economy will give
thrust to the infrastructure sector. Hindustan Construction
Company, Nagarjuna Construction Company, and IVRCL Infrastructure &
Projects rose by between 5.46% to 11.88%.
Marg was locked at 5% upper limit at Rs 34.45 at 12:54 IST on BSE,
on bagging a contract for developing an airport at Bijapur in
Karnataka.
PSU OMCs rose on fall in crude oil prices. BPCL, HPCL and Indian
Oil Corporation rose by between 0.66% to 1.28%. Crude oil fell for
a fifth day to the lowest in almost four years after a report
showed US fuel demand extended declines because of the country's
deepening economic slump. Crude oil for January 2008 delivery
dropped as much as $1.49, or 3.2%, to $45.30 a barrel on the New
York Mercantile Exchange. Lower oil prices will reduce
underrecoveries at the state-run oil firms on domestic sale of
petrol, diesel, LPG and kerosene at a controlled price.
Hindustan Oil Exploration Company rose 6.12% on bagging two oil and
gas blocks.
Consumer durables stocks rose on hopes further rate cuts by the
Reserve Bank of India would spur demand which is mainly driven by
finance. Videocon Indusries, Blue Star,Titan Industries, Lloyd
Electric and Rajesh Exports rose by between 1.52% to 3.56%.
Cement stocks rose on hopes likely government measures to boost the
infrastructure sector will spurt demand. ACC, Birla Corporation of
India, Ultratech Cement, Ambuja Cements and Grasim Industries rose
by between 1.13% to 6.6%.
Unitech clocked the highest volume of 3.19 crore shares on BSE.
Suzlon Energy (2.46 crore shares), GVK Power & Infrastructure (1.82
crore shares), Housing Development & Infrastructure (1.1 crore
shares) and Jaiprakash Associates (82.64 lakh shares) were the
other volume toppers in that order.
Reliance Industries clocked the highest turnover of Rs 404.61 crore
on BSE. State Bank of India (Rs 203.61 crore), Educomp Solutions
(Rs 178.33 crore), Reliance Infrastructure (Rs 153.18 crore) and
DLF (Rs 132.49 crore) were the other turnover toppers in that
order.
Haldyn Glass Gujarat spurted 8.51% on increase in the promoters'
stake in the company.
Nava Bharat Ventures jumped 20.28% on share buyback plan.
PVR galloped 4.88% on reports it plans to set up entertainment
centres across the country.
Chinese stocks rose after the government on Wednesday, 3 December
2008, announced measures whereby it will use financial policy to
support the economy. The Shanghai Composite was up 1.84%. But most
Asian shares weakened after earlier gains. Key benchmark indices in
South Korea, Hong Kong, Japan and Taiwan were down by between 0.58%
to 1.58%.
China will make use of required reserves as well as interest rates
and the exchange rate to ensure ample liquidity in the banking
system, the government said on Wednesday. The State Council,
China's cabinet, also approved measures aimed at stabilising the
domestic stock market, boosting bond issuance and increasing the
supply of credit.
further cut in interest rates, firm European stocks and rebound in
US index futures boosted the domestic bourses today. The BSE
30-share Sensex jumped 482.32 points, or 5.51%, led by a surge in
realty, metal, banking shares and index heavyweight Reliance
Industries (RIL). The barometer index breached the psychological
9,000 mark. All the sectoral indices on BSE were in the green.
Bank shares were in demand on as falling inflation heightened
expectations for an interest rate cute by the Reserve Bank of India
(RBI). As per the market buzz, the Reserve Bank of India (RBI) is
expected to cut repo and reverse repo rates to the extent of 200
basis points and 125 basis points respectively at the weekend, in
an attempt to shield the domestic economy from the global economic
slowdown. Repo rate is the rate at which RBI lends to commercial
banks and reverse repo rate is the rate at which RBI accepts
deposits from banks.
Inflation based on the wholesale price index rose 8.4% in the year
through 22 November 2008, lower than previous week's 8.84% rise,
data released by the government at about 13:15 IST showed.
Inflation had surged into double digits in early June this year
after an increase in state-set retail fuel prices, and peaked at
12.91% on, 2 August 2008, the highest reading since annual numbers
in the current data series became available in April 1995.
Reserve Bank of India (RBI) governor D Subbarao today, 4 December
2008, said India remains vulnerable to global financial and
economic developments and a period of painful adjustment was
inevitable. The RBI governor said India's economic fundamentals
were strong. He added that the outlook for India was mixed and
there was evidence of activity slowing down.
Meanwhile, the Indian government is slated to announce a slew of
measures at the weekend to pump prime the economy. The likely
measures include a Rs 2000-crore export package, a further
relaxation in external commercial borrowings norms and Rs
15,000-crore budgetary support for infrastructure.
A bout of volatility was witnessed earlier in the day. Likely
government measures to pump prime the economy and hopes of further
rate cuts by the Reserve bank of India gave a positive start to the
domestic bourses. But the market soon slipped into the red due to
lower US index futures, concerns about the weakening global economy
and due to tension between Indian and Pakistan following last
week's terror attacks in Mumbai may cap the upside. The market
firmed up again in early trade. After the recovery, the market
pared gains before bouncing back again. Sensex swung 518.35 points
between the day's high and low.
European stocks reversed early losses to rally on Thursday, 4
December 2008, rising for the third session in a row as investors
hoped deep interest rate cuts would help soothe the global economic
slump. The key benchmark indices in France, Germany and UK were up
by between 0.54% to 2.62%.
The Bank of England slashed interest rates by a full percentage
point today to shore up Britain's crumbling economy and head off
the threat of deflation. The cut took rates to 2% their lowest
level since 1951. The central bank in Sweden slashed its key
interest rate by a record 175 basis points to 2% on Thursday, a
shock move to try and prevent the economy from sliding deeper into
recession.
At its policy meeting later in the day, the European Central Bank
(ECB) is expected to cut rates by at least 75 basis points.
Meanwhile, economic, corporate and industry data continues to be
weak in major economies. Japan said on Thursday, 4 December 2008,
it may be in a deeper recession than first thought, in the latest
signal that the global economic downturn is sparing few corners of
the world. Earlier, a corporate survey in Japan signaled the
country's economic performance in the third quarter may have been
even worse than first reported. Australia's vehicle sales slumped
in November 2008.
US data on Wednesday, 3 December 2008, showed large job losses by
US employers and a slumping service sector. The US economy is
already in recession for a year.
Swiss Bank Credit Suisse today, 4 December 2008, reported a net
loss of about 3 billion Swiss francs ($2.5 billion) in the two
months to end-November 2008 and cut another 5,300 jobs.
Trading in US index futures indicated the Dow could rise 23 points
at the opening bell. The US index futures bounced back from steep
losses earlier in the day.
Closer home, the Indian government is reportedly considering
various options including a strike on Pakistan to dismantle its
terror bases in response to the recent Mumbai terror attacks. As a
strike on Pakistan could lead to a full scale war between the two
nuclear armed countries, India is maintaining a cautious approach
and wants to gauge every possible ramification of its decision,
reports suggest.
Tension between India and Pakistan have mounted after the Mumbai
attacks. India has blamed Islamist militants based in Pakistan for
the attacks.
The BSE 30-share Sensex was up 482.32 points, or 5.51%, to
9,229.75. At the day's high of 9,245.06 hit in late trade, the
Sensex rose 497.63 points. The Sensex lost 20.72 points at the
day's low of 8,726,71 hit in early trade.
The S&P CNX Nifty was up 131.55 points, or 4.95%, to 2,788.
The market breadth, indicating the overall health of the market,
was strong. On BSE, 1,503 shares rose as compared with 668 that
declined. 60 shares remained unchanged.
The BSE clocked a turnover of Rs 3727 crore today, higher than Rs
2,955.08 crore on Wednesday, 3 December 2008.
Nifty December 2008 futures were at 2796, at a premium of 8 points
as compared to the spot closing of 2788. Turnover in NSE's futures
& options (F&O) segment rose to Rs 34,123.92 crore from Rs
33,606.23 crore on Wednesday, 3 December 2008.
The barometer index BSE Sensex is down 11,057.24 points or 54.5% in
the calendar year 2008 so far from its close of 20,286.99 on 31
December 2007. It is 11,977.02 points or 56.47% below its all-time
high of 21,206.77 struck on 10 January 2008.
The BSE Realty index (up 12.44% to 1,753.65), the BSE Metal index
(up 7.93% to 4,803.91), the BSE Capital Goods index (up 6.91% to
6,506.98), the BSE Oil & Gas index (up 5.86% to 5,682.68), the BSE
Power index (up 5.7% to 1,676.43), the BSE Bankex (up 5.64% to
4,803.37) outperformed the Sensex.
The BSE HealthCare index (up 0.92% to 2,849.12), the BSE Consumer
Durables index (up 1.21% to 1,734.53), the BSE IT index (up 2.69%
to 2,464.74), the BSE FMCG index (up 2.8% to 1,954.75), the BSE
Auto index (up 3.22% to 2,243.11), the BSE Teck index (up 3.32% to
1,982.39) and the BSE PSU index (up 3.71% to 4,667.57),
underperformed the Sensex.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) surged 8.4% to Rs 1,159.30 on
recent reports it intends to restart retailing of petrol and diesel
soon after margins on the two fuels turned positive.
Realty stocks rose on reports the government will next week unveil
measures for the realty sector, which may include incentives for
low-cost housing and lower loan rates. Indiabulls Real Estate, DLF,
Unitech rose by between 11.28% to 17.17%.
Metal stocks rebounded from earlier slide on recovery in metal
prices on the London Metal Exchange (LME). Tata Steel, Hindalco
Industries, Sterlite Industries, Steel Authority of India, National
aluminum Company rose by between 2.65% to 13.84%.
Banking stocks edged higher on rate cut hopes. India's largest
private sector bank by net profit ICICI Bank rose 8.75% as American
depository receipt (ADR) gained 5.64% on Wednesday, 3 December
2008. India's largest commercial bank State Bank of India (SBI)
jumped 6.55%. India's second largest private sector bank by net
profit HDFC Bank gained 3.52% as ADR rose 2.6% on Wednesday.
Shares of housing finance firms rose on likely sops for the realty
sector, which may include incentives for low-cost housing and lower
loan rates. India's top mortgage lender by market capitalisation
Housing Development Finance Corporation (HDFC) rose 6.76% and
India's second-biggest mortgage lender by market capitalisation LIC
Housing Finance rose 10.37%.
Infrastructure Development Finance Company jumped 14.29% after a
block deal of 17.01 lakh shares was executed on BSE at Rs 58.50 per
share.
Indian Overseas Bank rose 3.04% after a block deal of ten lakh
shares was executed on BSE at Rs 67 per share.
IT stocks shrugged off a stronger rupee after India's second
largest IT exporter by sales Infosys' chief executive S.
Gopalakrishnan today, 4 December 2008, said though the company has
seen delays in orders there is no change in its third quarter
December 2008 guidance. Infosys rose 3.12%, recovering from a 4.29%
fall in the previous trading session.
India's fourth largest IT exporter by sales Wipro gained 4.71% as
ADR rose 1.95%. India's third largest IT exporter by sales Satyam
Computer Services rose 1.04% as ADR gained 2.43% on Wednesday, 3
December 2008. India's largest IT exporter by sales Tata
Consultancy Services rose 2.82%.
The Indian rupee was stronger in afternoon trade on Thursday as
hefty gains in the domestic share market raised expectations of
fresh capital inflows while a drop in oil prices also eased
concerns of a widening trade deficit. The partially convertible
rupee was at 49.78/80 per dollar, stronger than its Wednesday's
close of 49.99/50.01. On Tuesday, the rupee had hit a record low of
50.65. A stronger rupee affects IT firms negatively as they earn
most of their revenues from exports.
Auto stocks rose on hopes lower interest rates will spur demand
which is mainly driven by finance and on possible measures by the
government to boost the commercial vehicles sector. Mahindra &
Mahindra, Maruti Suzuki India and Hero Honda Motors rose by between
0.56% to 4.74%.
India's largest commercial vehicle maker by sales Tata Motors up
13.29% on reports of possible excise duty cut on commercial
vehicles as a part of the government's package to boost the
economy.
Capital goods stocks rose on hopes government efforts to boost
economy will lift orders. Larsen & Toubro, Suzlon Energy, Bharat
Heavy Electricals, Crompton Greaves and Thermax rose by between
2.87% to 10.24%.
Power stocks rose on reports the likely government measures to
boost the economy may include special credit window for the power
sector. Tata Power Company, Reliance Infrastructure, Reliance
Power, Power Grid Corporation of India jumped by between 3.21% to
7.46%.
India's largest drug maker by sales Ranbaxy Laboratories rose 3.57%
on signing a pact with a US drug firm.
Orchid Chemicals & Pharmaceuticals rose 2.51% on receiving US
approval for a new drug.
Infrastructure stocks extended gains for the second day in a row on
hopes a likely government package to boost the economy will give
thrust to the infrastructure sector. Hindustan Construction
Company, Nagarjuna Construction Company, and IVRCL Infrastructure &
Projects rose by between 5.46% to 11.88%.
Marg was locked at 5% upper limit at Rs 34.45 at 12:54 IST on BSE,
on bagging a contract for developing an airport at Bijapur in
Karnataka.
PSU OMCs rose on fall in crude oil prices. BPCL, HPCL and Indian
Oil Corporation rose by between 0.66% to 1.28%. Crude oil fell for
a fifth day to the lowest in almost four years after a report
showed US fuel demand extended declines because of the country's
deepening economic slump. Crude oil for January 2008 delivery
dropped as much as $1.49, or 3.2%, to $45.30 a barrel on the New
York Mercantile Exchange. Lower oil prices will reduce
underrecoveries at the state-run oil firms on domestic sale of
petrol, diesel, LPG and kerosene at a controlled price.
Hindustan Oil Exploration Company rose 6.12% on bagging two oil and
gas blocks.
Consumer durables stocks rose on hopes further rate cuts by the
Reserve Bank of India would spur demand which is mainly driven by
finance. Videocon Indusries, Blue Star,Titan Industries, Lloyd
Electric and Rajesh Exports rose by between 1.52% to 3.56%.
Cement stocks rose on hopes likely government measures to boost the
infrastructure sector will spurt demand. ACC, Birla Corporation of
India, Ultratech Cement, Ambuja Cements and Grasim Industries rose
by between 1.13% to 6.6%.
Unitech clocked the highest volume of 3.19 crore shares on BSE.
Suzlon Energy (2.46 crore shares), GVK Power & Infrastructure (1.82
crore shares), Housing Development & Infrastructure (1.1 crore
shares) and Jaiprakash Associates (82.64 lakh shares) were the
other volume toppers in that order.
Reliance Industries clocked the highest turnover of Rs 404.61 crore
on BSE. State Bank of India (Rs 203.61 crore), Educomp Solutions
(Rs 178.33 crore), Reliance Infrastructure (Rs 153.18 crore) and
DLF (Rs 132.49 crore) were the other turnover toppers in that
order.
Haldyn Glass Gujarat spurted 8.51% on increase in the promoters'
stake in the company.
Nava Bharat Ventures jumped 20.28% on share buyback plan.
PVR galloped 4.88% on reports it plans to set up entertainment
centres across the country.
Chinese stocks rose after the government on Wednesday, 3 December
2008, announced measures whereby it will use financial policy to
support the economy. The Shanghai Composite was up 1.84%. But most
Asian shares weakened after earlier gains. Key benchmark indices in
South Korea, Hong Kong, Japan and Taiwan were down by between 0.58%
to 1.58%.
China will make use of required reserves as well as interest rates
and the exchange rate to ensure ample liquidity in the banking
system, the government said on Wednesday. The State Council,
China's cabinet, also approved measures aimed at stabilising the
domestic stock market, boosting bond issuance and increasing the
supply of credit.
Thursday, December 4, 2008
Sensex regains 9k level on falling inflation
The benchmark Sensex regained the 9,000-point level on Thursday, 4 December, surging 400 points on renewed investor confidence after government data showed inflation much lower than expected at 8.4%.
India’s inflation hit a seven-month-low of 8.4% for week ended 22 November, against 8.84% the preceding week. Sliding inflation along with expected RBI rate cuts raised hopes of investors.
The Bombay Stock Exchange barometer surged 482.32 points to close at 9,229.75 with banking and realty sectors leading the rally. Unitech, the top gainer, rose 14.67% to Rs30.10.
The wide-based National Stock Exchange index Nifty rose 131.55 points at 2,788.
Tata group companies were important gainers in the day’s trading— Tata Motors surged 14.07% to Rs152, followed by Tata Communication (13.03%, Rs428) and Tata Steel (12.54%, Rs185.35).
Meanwhile Asian markets retreated from the opening gains as global economic fears grew among investors. Hang Seng and Nikkei fell by 1% at closing.
India’s inflation hit a seven-month-low of 8.4% for week ended 22 November, against 8.84% the preceding week. Sliding inflation along with expected RBI rate cuts raised hopes of investors.
The Bombay Stock Exchange barometer surged 482.32 points to close at 9,229.75 with banking and realty sectors leading the rally. Unitech, the top gainer, rose 14.67% to Rs30.10.
The wide-based National Stock Exchange index Nifty rose 131.55 points at 2,788.
Tata group companies were important gainers in the day’s trading— Tata Motors surged 14.07% to Rs152, followed by Tata Communication (13.03%, Rs428) and Tata Steel (12.54%, Rs185.35).
Meanwhile Asian markets retreated from the opening gains as global economic fears grew among investors. Hang Seng and Nikkei fell by 1% at closing.
Inflation slips further to 8.4% from 8.84%
India’s wholesale price index rose 8.4 % in the 12 months to 22 November, below the previous week’s annual rise of 8.84%, government data showed on Thursday.
The rate was also below a median forecast of 8.91% in a Reuters poll of analysts.
The annual inflation rate was 3.11% during the corresponding week of the previous year.
The wholesale price index is more closely watched than the consumer price index, which is published monthly, because it covers a higher number of products and is released weekly.
The rate was also below a median forecast of 8.91% in a Reuters poll of analysts.
The annual inflation rate was 3.11% during the corresponding week of the previous year.
The wholesale price index is more closely watched than the consumer price index, which is published monthly, because it covers a higher number of products and is released weekly.
Infosys pegs IT industry growth at 15% this year
New Delhi: The country’s second largest software exporter Infosys Technologies today said the domestic IT industry is likely to grow by 15% this year against 30% growth last year in the wake of global slowdown. “Last year the IT industry grew more than 30%, this year it is looking at somewhere in the region of 15%. So, it has slowed down,” Infosys CEO S Gopalakrishnan told reporters here on the sidelines of the CII conference.
IT industry association Nasscom has pegged the growth rate at 21% for this year due to the downturn in the world’s largest economy US, which contributes 60% of the total revenue.
“As per the estimates we are getting from industry bodies it looks like the sector will register a growth of 15% this year,” Gopalakrishnan added. However, he clarified that Infosys will stick to its revenue guidance for the third quarter and the fiscal. Infosys had earlier scaled down its dollar guidance (revenue projection in dollars) by about three percentage points for the full year to 13.1-15.2%.
Infosys has seen delays in orders but there was no change in its third quarter guidance, Gopalakrishnan added. On hiring plans, he added Infosys would hire 25,000 people this year, but there would be no fresh recruitments beyond that, except in specific skills. He further clarified that therewere no plans to cut headcount.
IT industry association Nasscom has pegged the growth rate at 21% for this year due to the downturn in the world’s largest economy US, which contributes 60% of the total revenue.
“As per the estimates we are getting from industry bodies it looks like the sector will register a growth of 15% this year,” Gopalakrishnan added. However, he clarified that Infosys will stick to its revenue guidance for the third quarter and the fiscal. Infosys had earlier scaled down its dollar guidance (revenue projection in dollars) by about three percentage points for the full year to 13.1-15.2%.
Infosys has seen delays in orders but there was no change in its third quarter guidance, Gopalakrishnan added. On hiring plans, he added Infosys would hire 25,000 people this year, but there would be no fresh recruitments beyond that, except in specific skills. He further clarified that therewere no plans to cut headcount.
EID Parry India Ltd Buy Back offer
Enam Securities Pvt Ltd (Manager to the Buy Back) On behalf of EID Parry India Ltd (Target Company) has issued this Public Announcement (PA) to the Equity Shareholders / Beneficial Owners of the Equity Shares of the Target Company pursuant to the Provision of Regulation 8(1) read with Regulation 15(c) and is in compliance with the Securities & Exchange Board of India (Buyback of Securities) Regulations, 1998 as amended and contains the disclosure as specified in schedule II to these Regulations.
The Buyback
The Company hereby announces the buyback (Buyback) of its fully paid-up Equity shares of the face value of Rs 2 each (Shares) from the existing owners of Shares of the Company other than the Promoter / persons who are in control of the company & Promoter Group (Promoters) from the open market through stock exchange using the electronic trading facilities of the Bombay Stock Exchange Ltd (BSE) and the National Stock Exchange of India Ltd (NSE) (together the Stock Exchanges), in accordance with the provisions of Section 77A, 77AA, 77B and all other applicable provisions, if any, of the Companies Act, 1956 (the Act) and the securities & Exchange Board of India (buyback of Securities) regulations 1998 (the Buyback Regulations) and the relevant provisions of the Memorandum of Association and clause 3 of the Articles of Association of the Company subject to approval/s as may be necessary, from time to time from statutory authorities including but not limited to securities and Exchange Board of India, Stock Exchanges, Reserve Bank of India etc, as required at a maximum price not exceeding Rs 160 per equity shares (Maximum Buyback Price) payable in cash, for an aggregate amount not exceeding Rs 4684 lakhs (rupees Forty-six crores eighty four lakhs only) (the maximum Buyback Size). The Buyback size represents 10% of the aggregate of the companys paid-up equity capital and eligible free reserves as on March 31, 2008 (the date of the latest standalone audited accounts as on the date of the resolution dated October 29, 2008 approving the Buyback by the Board of Directors of the Company) which is within the maximum permissible limit of 10% of the paid-up equity capital and eligible free reserves. The aggregate paid up equity share capital and eligible free reserves of the Company as at March 31, 2008 was Rs 46841 lakhs.
The maximum number of shares the Company can buyback, as per Section 77A of the Act, in any financial year shall not exceed twenty-five percent of the total paid-up equity capital of the Company in that financial year.
The actual number of equity shares to be bought back would depend upon the average price paid for the equity shares bought back and the amount deployed in the buyback in accordance with the resolution passed by the Board of Directors of the Company on October 29, 2008. The Company proposes to buy a minimum of 7,31,875 shares (Minimum Offer Shares).
The maximum Buyback price offers a premium of 1.19% and 1.63% over the closing prices on BSE and NSE respectively prevailing on October 29, 2008 i.e. the date of the Board meeting approving the Buyback. The Closing price of shares as on October 29, 2008 on BSE & NSE was Rs 158.10 & Rs 157.40 respectively.
Proposed Time Table
Board Meeting Approving Buyback - October 29, 2008
Date of Public Notice - October 31, 2008
Date of Opening of Buyback - December 15, 2008
Acceptance of Shares - Within 15 days of the relevant payout dates of the respective Stock Exchanges.
Extinguishment of Shares - Within 15 days of relevant payout dates
Last Date for the Buyback - October 28, 2009 (i.e. 12 months from the date of the resolution passed by the Board of Directors of the Company at its meeting held on October 29, 2008). However, the Board in its absolute discretion may decide to close the Buyback at an earlier date in the event Minimum Offer Shares have been purchased under the Buyback even if maximum Buyback size has not been reached, by giving appropriate notice of such date and completing all formalities in this regard as per relevant laws and Regulations. There would be a completion of all payment obligations in respect of Buy-back prior to the last date of Buy-back.
The Buyback
The Company hereby announces the buyback (Buyback) of its fully paid-up Equity shares of the face value of Rs 2 each (Shares) from the existing owners of Shares of the Company other than the Promoter / persons who are in control of the company & Promoter Group (Promoters) from the open market through stock exchange using the electronic trading facilities of the Bombay Stock Exchange Ltd (BSE) and the National Stock Exchange of India Ltd (NSE) (together the Stock Exchanges), in accordance with the provisions of Section 77A, 77AA, 77B and all other applicable provisions, if any, of the Companies Act, 1956 (the Act) and the securities & Exchange Board of India (buyback of Securities) regulations 1998 (the Buyback Regulations) and the relevant provisions of the Memorandum of Association and clause 3 of the Articles of Association of the Company subject to approval/s as may be necessary, from time to time from statutory authorities including but not limited to securities and Exchange Board of India, Stock Exchanges, Reserve Bank of India etc, as required at a maximum price not exceeding Rs 160 per equity shares (Maximum Buyback Price) payable in cash, for an aggregate amount not exceeding Rs 4684 lakhs (rupees Forty-six crores eighty four lakhs only) (the maximum Buyback Size). The Buyback size represents 10% of the aggregate of the companys paid-up equity capital and eligible free reserves as on March 31, 2008 (the date of the latest standalone audited accounts as on the date of the resolution dated October 29, 2008 approving the Buyback by the Board of Directors of the Company) which is within the maximum permissible limit of 10% of the paid-up equity capital and eligible free reserves. The aggregate paid up equity share capital and eligible free reserves of the Company as at March 31, 2008 was Rs 46841 lakhs.
The maximum number of shares the Company can buyback, as per Section 77A of the Act, in any financial year shall not exceed twenty-five percent of the total paid-up equity capital of the Company in that financial year.
The actual number of equity shares to be bought back would depend upon the average price paid for the equity shares bought back and the amount deployed in the buyback in accordance with the resolution passed by the Board of Directors of the Company on October 29, 2008. The Company proposes to buy a minimum of 7,31,875 shares (Minimum Offer Shares).
The maximum Buyback price offers a premium of 1.19% and 1.63% over the closing prices on BSE and NSE respectively prevailing on October 29, 2008 i.e. the date of the Board meeting approving the Buyback. The Closing price of shares as on October 29, 2008 on BSE & NSE was Rs 158.10 & Rs 157.40 respectively.
Proposed Time Table
Board Meeting Approving Buyback - October 29, 2008
Date of Public Notice - October 31, 2008
Date of Opening of Buyback - December 15, 2008
Acceptance of Shares - Within 15 days of the relevant payout dates of the respective Stock Exchanges.
Extinguishment of Shares - Within 15 days of relevant payout dates
Last Date for the Buyback - October 28, 2009 (i.e. 12 months from the date of the resolution passed by the Board of Directors of the Company at its meeting held on October 29, 2008). However, the Board in its absolute discretion may decide to close the Buyback at an earlier date in the event Minimum Offer Shares have been purchased under the Buyback even if maximum Buyback size has not been reached, by giving appropriate notice of such date and completing all formalities in this regard as per relevant laws and Regulations. There would be a completion of all payment obligations in respect of Buy-back prior to the last date of Buy-back.
Pre MArket 4th Dec 2008
The market may edge higher on positive cues from global markets and on likely government measures to pump prime the economy. However, Indo-Pak tension after the major terror strike in Mumbai last week will cap the upside.
Chinese stocks led gains in Asian stocks after China on Wednesday, 3 December 2008, announces measures whereby the financial policy would be harnessed to support the economy. The Shanghai Composite was up 3%. Other Asian share nudge higher on buying in defensive plays such as drug makers or domestic demand-driven plays. Key benchmark indices in Hong Kong, Singapore and South Korea were up by between 0.06% to 1.9%. But Japanâ€(TM)s Nikkei had slipped into the red in contrast to earlier gains.
China will make use of required reserves as well as interest rates and the exchange rate to ensure ample liquidity in the banking system, the government said on Wednesday. The State Council, China's cabinet, also approved measures aimed at stabilising the domestic stock market, boosting bond issuance and increasing the supply of credit.
Defensive stocks lifted Wall Street on Wednesday, 3 December 2008, in spite of new data -- including large job losses among US employers and a slumping service sector -- that failed to inspire confidence in a US economy already in recession for a year.
Other economies worldwide are faring no better. A corporate survey in Japan signaled the country's economic performance in the third quarter may have been even worse than first reported.
Closer home, the Indian government is slated to announce a slew of measures at the weekend to pump prime the economy. The likely measures include a Rs 2000-crore export package, a further relaxation in external commercial borrowings norms and Rs 15,000-crore budgetary support for infrastructure.
The Reserve Bank of India (RBI), meanwhile, is expected to cut repo and reverse repo rates to the extent of 200 basis points and 125 basis points respectively at the weekend.
Meanwhile, the Indian government is reportedly considering various options including a strike on Pakistan to dismantle its terror bases in response to the recent Mumbai terror attacks. As a strike on Pakistan could lead to a full scale war between the two nuclear armed countries, India is maintaining a cautious approach and wants to gauge every possible ramification of its decision, reports suggest.
Tension between India and Pakistan have mounted after the Mumbai attacks. India has blamed Islamist militants based in Pakistan for the attacks.
Chinese stocks led gains in Asian stocks after China on Wednesday, 3 December 2008, announces measures whereby the financial policy would be harnessed to support the economy. The Shanghai Composite was up 3%. Other Asian share nudge higher on buying in defensive plays such as drug makers or domestic demand-driven plays. Key benchmark indices in Hong Kong, Singapore and South Korea were up by between 0.06% to 1.9%. But Japanâ€(TM)s Nikkei had slipped into the red in contrast to earlier gains.
China will make use of required reserves as well as interest rates and the exchange rate to ensure ample liquidity in the banking system, the government said on Wednesday. The State Council, China's cabinet, also approved measures aimed at stabilising the domestic stock market, boosting bond issuance and increasing the supply of credit.
Defensive stocks lifted Wall Street on Wednesday, 3 December 2008, in spite of new data -- including large job losses among US employers and a slumping service sector -- that failed to inspire confidence in a US economy already in recession for a year.
Other economies worldwide are faring no better. A corporate survey in Japan signaled the country's economic performance in the third quarter may have been even worse than first reported.
Closer home, the Indian government is slated to announce a slew of measures at the weekend to pump prime the economy. The likely measures include a Rs 2000-crore export package, a further relaxation in external commercial borrowings norms and Rs 15,000-crore budgetary support for infrastructure.
The Reserve Bank of India (RBI), meanwhile, is expected to cut repo and reverse repo rates to the extent of 200 basis points and 125 basis points respectively at the weekend.
Meanwhile, the Indian government is reportedly considering various options including a strike on Pakistan to dismantle its terror bases in response to the recent Mumbai terror attacks. As a strike on Pakistan could lead to a full scale war between the two nuclear armed countries, India is maintaining a cautious approach and wants to gauge every possible ramification of its decision, reports suggest.
Tension between India and Pakistan have mounted after the Mumbai attacks. India has blamed Islamist militants based in Pakistan for the attacks.
Crude at $45.95/bbl
Crude oil prices was little changed on the back of an energy department report showing US refineries curbed operating rates as recession reduces fuel demand.
In after hours access trading, Nymex is at crude at 45.95/bbl.
In after hours access trading, Nymex is at crude at 45.95/bbl.
TCS reviewing capex plans: Ramadorai
Tata Consultancy Services Ltd (TCS) is in the process of reviewing its capital expenditure plans for the current year due to the global economic crisis.
Speaking to the media on the sidelines of the Internet Governance Forum 2008 here, the Chief Executive Officer and Managing Director of TCS, Mr S. Ramadorai, said, “We may shift the capex plans in terms of delays in technologies, strategy and infrastructure plans.”
He said the financial crisis was for real and it had impacted not just one country or company, but the entire world.
According to him, TCS was taking cost cutting measures in terms of productivity improvement, improving utilisation rates of its employees, power, and travel, apart from capex reduction.
“Last quarter, the utilisation rates were around 81 per cent, but now we hope to enhance it to between 82 and 83 per cent,” he said.
Asked if the company was reducing its exposure to the banking, financial services and insurance (BFSI) segment, which was the major revenue earner, and diversify into other areas, Mr Ramadorai said the company would not consciously bring down the BFSI business, but would focus on other technology segments was well.
The company was ready to accept business in the BFSI segment as it had long-term contracts with clients.
Mr Ramadorai replied in the negative when asked if TCS was issuing pink slips to its employees.
Earlier, while addressing the IGF meet, Mr Ramadorai, who is also chairing the Business Action to Support the
Information Society of the International Chamber of Commerce, said that lack of dependable electricity sources created access problems to Internet for many people in developing countries.
Speaking to the media on the sidelines of the Internet Governance Forum 2008 here, the Chief Executive Officer and Managing Director of TCS, Mr S. Ramadorai, said, “We may shift the capex plans in terms of delays in technologies, strategy and infrastructure plans.”
He said the financial crisis was for real and it had impacted not just one country or company, but the entire world.
According to him, TCS was taking cost cutting measures in terms of productivity improvement, improving utilisation rates of its employees, power, and travel, apart from capex reduction.
“Last quarter, the utilisation rates were around 81 per cent, but now we hope to enhance it to between 82 and 83 per cent,” he said.
Asked if the company was reducing its exposure to the banking, financial services and insurance (BFSI) segment, which was the major revenue earner, and diversify into other areas, Mr Ramadorai said the company would not consciously bring down the BFSI business, but would focus on other technology segments was well.
The company was ready to accept business in the BFSI segment as it had long-term contracts with clients.
Mr Ramadorai replied in the negative when asked if TCS was issuing pink slips to its employees.
Earlier, while addressing the IGF meet, Mr Ramadorai, who is also chairing the Business Action to Support the
Information Society of the International Chamber of Commerce, said that lack of dependable electricity sources created access problems to Internet for many people in developing countries.
Mkt likely to be rangebound
The market is likely to be range bound on lack of fresh triggers. The Sensex is likely to be ranged between 8000-9500. The low delivery volumes show that distressed selling by FIIs is over. Domestic MFs are sitting on cash on expectations of redemption pressure.
RBI to cut repo, reverse repo rates on Sat: Sources
The Reserve Bank of India (RBI) is likely to cut repo and reverse repo rates on Saturday. However, a CRR cut, sources added, is unlikely. External commercial borrowings (ECB) norms could be eased further too, they said, adding that the RBI is also likely to ask banks to cut deposit rates.
The government, sources said, is expected to announce a fiscal package for the housing, auto and export sectors. Sources added that while the export package would cost the government Rs 2000 crore, an additional budgetary support for the infrastructure could be to the tune of Rs 15,000 crore and there may be a special line of credit for non-banking financial companies, the housing and auto sectors.
Across the board, an excise duty reduction is likely on commercial vehicles, sources said. The government export target for FY09 is likely to be around USD 175 billion, they added.
Disclaimer: Not confirmed news.. only the info to the news agencies
The government, sources said, is expected to announce a fiscal package for the housing, auto and export sectors. Sources added that while the export package would cost the government Rs 2000 crore, an additional budgetary support for the infrastructure could be to the tune of Rs 15,000 crore and there may be a special line of credit for non-banking financial companies, the housing and auto sectors.
Across the board, an excise duty reduction is likely on commercial vehicles, sources said. The government export target for FY09 is likely to be around USD 175 billion, they added.
Disclaimer: Not confirmed news.. only the info to the news agencies
Asian markets trading higher; Shanghai up 2%
Asian markets were trading higher. China's Shanghai Composite rose 2.08% or 40.85 points at 2,006.27.
Hong Kong's Hang Seng gained 1.54% or 209 points at 13,797.66.
Japan's Nikkei advanced 0.62% or 49.34 points at 8,053.44.
Singapore's Straits Times was up 1.97% or 32.36 points at 1,672.93.
South Korea's Seoul Composite added 0.30% or 3.03 points at 1,025.70.
Taiwan's Taiwan Weighted was up 0.53% or 22.66 points at 4,329.92
Hong Kong's Hang Seng gained 1.54% or 209 points at 13,797.66.
Japan's Nikkei advanced 0.62% or 49.34 points at 8,053.44.
Singapore's Straits Times was up 1.97% or 32.36 points at 1,672.93.
South Korea's Seoul Composite added 0.30% or 3.03 points at 1,025.70.
Taiwan's Taiwan Weighted was up 0.53% or 22.66 points at 4,329.92
Monday, December 1, 2008
Pre Market Report 01/12/2008
The end of the operation to flush out terrorists on Saturday, 29 November 2008 and expectations of further cut in interest rates may lift the market which on Friday, 28 November 2008, shrugged off major terrorists attacks on Mumbai, Indiaâ€(TM)s financial capital late on Wednesday, 26 November 2008. There are expectations that the Reserve Bank of India (RBI) will cut rates further to shore up confidence battered by the global financial crisis and the series of attacks around the city.
With P Chidambaram set to take over as the new home minister, there is a perception that the RBI may gain more breathing space while making policies. There has been criticism in recent weeks that a series of policy measures were being driven by the finance ministry. But now with Prime Minister (PM) Dr Manmohan Singh, himself a former RBI governor, holding additional charge of the finance ministry, the prospects of the governor coming into his own are far greater.
The PM, the architect of early 1990s economic reforms, holding additional charge of the finance ministry will also be perceived as a positive sign for the stock markets in terms of ensuring continuity and signaling a pro-reform image even though just a few months are left as parliamentary elections must be held before May 2009.
Asian markets were mixed. Japan's Nikkei average fell 2% by midday as global recession fears prompted investors to book profits after last week's rally, with exporters such as Toyota Motor Corp slipping on a firmer yen.
Early results from the Black Friday weekend that marks the start of the Christmas shopping season in the United States showed that sales grew in shops and online, fuelled by repeat trips and deep discounts. But an early rush is unlikely to save what is shaping up to be a bleak sales season, reports suggest.
With P Chidambaram set to take over as the new home minister, there is a perception that the RBI may gain more breathing space while making policies. There has been criticism in recent weeks that a series of policy measures were being driven by the finance ministry. But now with Prime Minister (PM) Dr Manmohan Singh, himself a former RBI governor, holding additional charge of the finance ministry, the prospects of the governor coming into his own are far greater.
The PM, the architect of early 1990s economic reforms, holding additional charge of the finance ministry will also be perceived as a positive sign for the stock markets in terms of ensuring continuity and signaling a pro-reform image even though just a few months are left as parliamentary elections must be held before May 2009.
Asian markets were mixed. Japan's Nikkei average fell 2% by midday as global recession fears prompted investors to book profits after last week's rally, with exporters such as Toyota Motor Corp slipping on a firmer yen.
Early results from the Black Friday weekend that marks the start of the Christmas shopping season in the United States showed that sales grew in shops and online, fuelled by repeat trips and deep discounts. But an early rush is unlikely to save what is shaping up to be a bleak sales season, reports suggest.
Monday, November 17, 2008
Japan slips into recession
The key benchmark indices extended losses in mid-morning trade on a
deteriorating global outlook as Japan joined the list of economies
in recession. The BSE 30-share Sensex was down 335.74 points, or
3.58%. Measures announced by the Reserve Bank of India (RBI) during
the weekend to shield the Indian economy from the global economic
slowdown and pledges from leaders of the Group of 20 nations to
stimulate growth and reform the financial system, failed to avert
the slide.
Japan slid into its first recession in seven years in the third
quarter as the financial crisis curbed demand for Japanese exports.
Despite the weak data, the the Nikkei rose 0.7% in a choppy trade,
with buying by pension funds lifting the market. Stocks elsewhere
were mixed. Key benchmark indices in Hong Kong, Singapore and China
were up by between 0.27% to 0.43%. Key benchmark indices in South
Koera, Taiwan fell by between 0.3% to 0.52%.
The G20 political leaders agreed Saturday, 15 November 2008, to a
host of fiscal and monetary steps to rescue the global economy but
it was left to individual governments to tailor their response to
their particular circumstances and troubled industries.
RBI on Saturday, 15 November 2008, announced measures to improve
money market liquidity and help exporters. The measures include
extension of a special repurchase facility to provide liquidity for
mutual funds and non-banking finance companies till March 2009,
increase in the limit on export credit refinance available to
banks, allowing housing finance companies to raise funds through
short-term overseas borrowings, reduction in provisioning on
standard assets of banks to a uniform level of 0.4%, and reduction
in risk weights for banks on commercial real estate and on unrated
claims on corporates.
The central bank also said it would consider proposals from local
firms to buy back foreign currency convertible bonds early.
At 11:33 IST, the BSE 30-share Sensex was down 335.74 points, or
3.58%, to 9,049.68. At the day's high of 9,435.89 hit in early
trade, the Sensex gained 50.47points. The Sensex fell 369.08 points
at the day's low of 9,016.34 in mid-morning trade.
The S&P CNX Nifty fell 100.15 points, or 3.56%, to 2,710.20.
The market breadth, indicating the overall health of the market,
was weak. On BSE, 407 shares rose as compared with 1607 that
declined. 51 shares remained unchanged.
Among the 30-member Sensex pack, all the stocks were in red.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) slipped 4.4% to Rs 1,098. The
government on Friday, 14 November 2008, said RIL cannot sell gas to
anybody at a price less than $4.20 per British Thermal Units
without its approving the pricing formula.
Sterlite Industries (down 8.93% to Rs 206.90), Reliance
Infrastructure (down 5.34% to Rs 489) and Hindalco Industries (down
4.95% to Rs 53.80) were the losers from the sensex pack.
PSU OMCs were mixed as crude oil prices fell. BPCL and HPCL rose
between 1.12% to 2.23%. Indian Oil Corporation fell 1.38%.
Realty shares dropped on concerns banks may not raise lending to
realty firms despite the latest Reserve Bank of India measures to
ease lending to the cash-stripped sector. Realty majors, Indiabulls
Real Estate, Parsvnath Developers, Unitech, DLF fell by between
4.94% to 8.52%.
RBI reduced risk weights for commercial real estate to 100% from
the earlier 150%. This measure is expected to encourage banks to
lend more to the fund-starved sector. In order to ensure more
liquidity for the real estate sector, RBI also allowed the
registered housing finance companies to raise short-term funds from
overseas markets.
Despite the measures, experts doubt whether banks will raise
lending to the realty sector given the severe slowdown and
increasing risk of non performing assets (NPAs).
Banking stocks extended losses as weak American Depository Receipts
(ADRs) offset Reserve Bank of India's steps to augment both rupee
and dollar liquidity in the banking system. India's largest private
sector bank by net profit ICICI Bank fell 7.72% as ADR lost 6.56%
on Friday, 14 November 2008. India's second largest private sector
bank by net profit HDFC Bank fell 6.98% as ADR slumped 6.39% on
Friday. India's largest commercial bank State Bank of India (SBI)
lost 2.77%.
IT stocks were down on weak ADRs and stronger rupee. India's third
largest IT exporter by sales Satyam Computer Services fell 3.8% as
its American depository receipt (ADR) fell 9.68% on Friday, 14
November 2008.
India's second largest IT exporter by sales Infosys slipped 3.23%,
as ADR fell 5.68%. India's fourth largest IT exporter by sales
Wipro lost 2.43% as ADR slipped 13.36%. India's largest IT exporter
by sales Tata Consultancy Services lost 1.87%.
The Indian rupee strengthened on Monday buoyed by the central
bank's measures to encourage foreign deposits, but gains were
capped as a fall in the stock market raised concerns of further
capital outflows. The partially convertible rupee was at 48.87/90
per dollar, 0.3% stronger than 49.01/03 at the close on Friday 14
November 2008. A stronger rupee impacts operating margins of IT
firms as they earn most of their revenue in dollar terms.
Cement stocks slipped even as the government announced incentive to
cement exports. ACC, Grasim Industries, Ultratech Cement, Birla
Corporation, Ambuja Cements fell between 1.59% to 3.56%.
According to a government notification, exporters of cement and
several steel items will be entitled for tax refunds through duty
entitlement pass book scheme. The government also announced that
the two sectors cement and steel have been included in the Focus
Market Scheme which will enable these distressed industries to
boost their exports to the third world.
India's largest engineering and construction firm by sales Larsen &
Toubro slipped 1.58% despite reports of the company in talks with
Antwerp Port Authority to establish a greenfield port in the west
coast of the country. The venture will initially invest Rs 2000
crore into the port.
Godrej Consumer Products rose 1.55% after a block deal of 17.20
lakh of equity shares was struck on the counter on BSE at Rs
116.50.
United Breweries moved up 5.15% after a block deal of 5.30 lakh of
equity shares was struck on the counter on BSE at Rs 93.
Godawari Power & Ispat was up 4.01% after the company said it will
re-consider a share buyback proposal that was approved on 27
October 2008.
Apollo Tyres gained 2.02% on reports it plans to invest Rs 3000
crore in the next five years for expansion.
deteriorating global outlook as Japan joined the list of economies
in recession. The BSE 30-share Sensex was down 335.74 points, or
3.58%. Measures announced by the Reserve Bank of India (RBI) during
the weekend to shield the Indian economy from the global economic
slowdown and pledges from leaders of the Group of 20 nations to
stimulate growth and reform the financial system, failed to avert
the slide.
Japan slid into its first recession in seven years in the third
quarter as the financial crisis curbed demand for Japanese exports.
Despite the weak data, the the Nikkei rose 0.7% in a choppy trade,
with buying by pension funds lifting the market. Stocks elsewhere
were mixed. Key benchmark indices in Hong Kong, Singapore and China
were up by between 0.27% to 0.43%. Key benchmark indices in South
Koera, Taiwan fell by between 0.3% to 0.52%.
The G20 political leaders agreed Saturday, 15 November 2008, to a
host of fiscal and monetary steps to rescue the global economy but
it was left to individual governments to tailor their response to
their particular circumstances and troubled industries.
RBI on Saturday, 15 November 2008, announced measures to improve
money market liquidity and help exporters. The measures include
extension of a special repurchase facility to provide liquidity for
mutual funds and non-banking finance companies till March 2009,
increase in the limit on export credit refinance available to
banks, allowing housing finance companies to raise funds through
short-term overseas borrowings, reduction in provisioning on
standard assets of banks to a uniform level of 0.4%, and reduction
in risk weights for banks on commercial real estate and on unrated
claims on corporates.
The central bank also said it would consider proposals from local
firms to buy back foreign currency convertible bonds early.
At 11:33 IST, the BSE 30-share Sensex was down 335.74 points, or
3.58%, to 9,049.68. At the day's high of 9,435.89 hit in early
trade, the Sensex gained 50.47points. The Sensex fell 369.08 points
at the day's low of 9,016.34 in mid-morning trade.
The S&P CNX Nifty fell 100.15 points, or 3.56%, to 2,710.20.
The market breadth, indicating the overall health of the market,
was weak. On BSE, 407 shares rose as compared with 1607 that
declined. 51 shares remained unchanged.
Among the 30-member Sensex pack, all the stocks were in red.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) slipped 4.4% to Rs 1,098. The
government on Friday, 14 November 2008, said RIL cannot sell gas to
anybody at a price less than $4.20 per British Thermal Units
without its approving the pricing formula.
Sterlite Industries (down 8.93% to Rs 206.90), Reliance
Infrastructure (down 5.34% to Rs 489) and Hindalco Industries (down
4.95% to Rs 53.80) were the losers from the sensex pack.
PSU OMCs were mixed as crude oil prices fell. BPCL and HPCL rose
between 1.12% to 2.23%. Indian Oil Corporation fell 1.38%.
Realty shares dropped on concerns banks may not raise lending to
realty firms despite the latest Reserve Bank of India measures to
ease lending to the cash-stripped sector. Realty majors, Indiabulls
Real Estate, Parsvnath Developers, Unitech, DLF fell by between
4.94% to 8.52%.
RBI reduced risk weights for commercial real estate to 100% from
the earlier 150%. This measure is expected to encourage banks to
lend more to the fund-starved sector. In order to ensure more
liquidity for the real estate sector, RBI also allowed the
registered housing finance companies to raise short-term funds from
overseas markets.
Despite the measures, experts doubt whether banks will raise
lending to the realty sector given the severe slowdown and
increasing risk of non performing assets (NPAs).
Banking stocks extended losses as weak American Depository Receipts
(ADRs) offset Reserve Bank of India's steps to augment both rupee
and dollar liquidity in the banking system. India's largest private
sector bank by net profit ICICI Bank fell 7.72% as ADR lost 6.56%
on Friday, 14 November 2008. India's second largest private sector
bank by net profit HDFC Bank fell 6.98% as ADR slumped 6.39% on
Friday. India's largest commercial bank State Bank of India (SBI)
lost 2.77%.
IT stocks were down on weak ADRs and stronger rupee. India's third
largest IT exporter by sales Satyam Computer Services fell 3.8% as
its American depository receipt (ADR) fell 9.68% on Friday, 14
November 2008.
India's second largest IT exporter by sales Infosys slipped 3.23%,
as ADR fell 5.68%. India's fourth largest IT exporter by sales
Wipro lost 2.43% as ADR slipped 13.36%. India's largest IT exporter
by sales Tata Consultancy Services lost 1.87%.
The Indian rupee strengthened on Monday buoyed by the central
bank's measures to encourage foreign deposits, but gains were
capped as a fall in the stock market raised concerns of further
capital outflows. The partially convertible rupee was at 48.87/90
per dollar, 0.3% stronger than 49.01/03 at the close on Friday 14
November 2008. A stronger rupee impacts operating margins of IT
firms as they earn most of their revenue in dollar terms.
Cement stocks slipped even as the government announced incentive to
cement exports. ACC, Grasim Industries, Ultratech Cement, Birla
Corporation, Ambuja Cements fell between 1.59% to 3.56%.
According to a government notification, exporters of cement and
several steel items will be entitled for tax refunds through duty
entitlement pass book scheme. The government also announced that
the two sectors cement and steel have been included in the Focus
Market Scheme which will enable these distressed industries to
boost their exports to the third world.
India's largest engineering and construction firm by sales Larsen &
Toubro slipped 1.58% despite reports of the company in talks with
Antwerp Port Authority to establish a greenfield port in the west
coast of the country. The venture will initially invest Rs 2000
crore into the port.
Godrej Consumer Products rose 1.55% after a block deal of 17.20
lakh of equity shares was struck on the counter on BSE at Rs
116.50.
United Breweries moved up 5.15% after a block deal of 5.30 lakh of
equity shares was struck on the counter on BSE at Rs 93.
Godawari Power & Ispat was up 4.01% after the company said it will
re-consider a share buyback proposal that was approved on 27
October 2008.
Apollo Tyres gained 2.02% on reports it plans to invest Rs 3000
crore in the next five years for expansion.
Pre Market Report 17/11/2008
More measures announced by the Reserve Bank of India (RBI) to shield the Indian economy from the global economic slowdown may lift the market from a recent steep fall. But stepping up of sales by foreign funds in the last two days may weigh on the sentiments. On the flip side, gains in Asian markets may support the domestic bourses. Asian markets rose even as there was no concrete move at a meeting of the G20 countries on Friday 14 November-Saturday-15 November 2008 to avert a looming global recession.
RBI on Saturday, 15 November 2008, announced measures to improve money market liquidity and help exporters. The measures include extension of a special repurchase facility to provide liquidity for mutual funds and non-banking finance companies till March 2009, increase in the limit on export credit refinance available to banks, allowing housing finance companies to raise funds through short-term overseas borrowings, reduction in provisioning on standard assets of banks to a uniform level of 0.4%, and reduction in risk weights for banks on commercial real estate and on unrated claims on corporates.
The central bank also said it would consider proposals from local firms to buy back foreign currency convertible bonds early.
Foreign funds have stepped up selling on the bourses. As per provisional data, foreign institutional investors (FIIs) dumped stocks worth a net Rs 811.52 crore on Friday, 14 November 2008. On Wednesday, 12 November 2008, FIIs had pressed sales worth a net Rs 615.10 crore, much higher than Rs 266.50 crore on the previous trading session. The market was closed on Thursday, 13 November 2008, for a public holiday.
Political uncertainty ahead of state elections, uncertainty about a US Treasury plan to forgo buying bad mortgage-related investments to buy stakes in US lenders and caution ahead of a meeting of G20 political leaders, pulled the market sharply lower in the past three trading sessions. The BSE Sensex has declined 1150.74 points or 10.92% to 9,385.42 on Friday, 14 November 2008, from 10536.16 on 10 November 2008.
Stocks were mixed in Asia. The Nikkei average rose 1.2% in thin trade as some investors rushed in to buy following an initial sell-off after data showed Japan's economy was in recession. Key benchmark indices in Hong Kong, South Koera, Singapore, Taiwan and China were up by between 0.23% to 1.3%.
The G20 political leaders agreed Saturday, 15 November 2008, to a host of fiscal and monetary steps to rescue the global economy but it was left to individual governments to tailor their response to their particular circumstances and troubled industries.
RBI on Saturday, 15 November 2008, announced measures to improve money market liquidity and help exporters. The measures include extension of a special repurchase facility to provide liquidity for mutual funds and non-banking finance companies till March 2009, increase in the limit on export credit refinance available to banks, allowing housing finance companies to raise funds through short-term overseas borrowings, reduction in provisioning on standard assets of banks to a uniform level of 0.4%, and reduction in risk weights for banks on commercial real estate and on unrated claims on corporates.
The central bank also said it would consider proposals from local firms to buy back foreign currency convertible bonds early.
Foreign funds have stepped up selling on the bourses. As per provisional data, foreign institutional investors (FIIs) dumped stocks worth a net Rs 811.52 crore on Friday, 14 November 2008. On Wednesday, 12 November 2008, FIIs had pressed sales worth a net Rs 615.10 crore, much higher than Rs 266.50 crore on the previous trading session. The market was closed on Thursday, 13 November 2008, for a public holiday.
Political uncertainty ahead of state elections, uncertainty about a US Treasury plan to forgo buying bad mortgage-related investments to buy stakes in US lenders and caution ahead of a meeting of G20 political leaders, pulled the market sharply lower in the past three trading sessions. The BSE Sensex has declined 1150.74 points or 10.92% to 9,385.42 on Friday, 14 November 2008, from 10536.16 on 10 November 2008.
Stocks were mixed in Asia. The Nikkei average rose 1.2% in thin trade as some investors rushed in to buy following an initial sell-off after data showed Japan's economy was in recession. Key benchmark indices in Hong Kong, South Koera, Singapore, Taiwan and China were up by between 0.23% to 1.3%.
The G20 political leaders agreed Saturday, 15 November 2008, to a host of fiscal and monetary steps to rescue the global economy but it was left to individual governments to tailor their response to their particular circumstances and troubled industries.
Monday, November 10, 2008
Market extends gains
Sustained buying demand in index pivotals helped market extend
early gains after opening on a buoyant note tracking gains in Asian
stocks and higher US index futures. Capital goods and metal stocks
were in demand. The market breadth was strong.
China�s Shanghai Composite surged 4.44% after the government on
Sunday, 9 November 2008, announced $586 billion in infrastructure
and public welfare spending to slow the crisis's impact on its
economy, the world's fourth-largest. Other Asian markets, too, were
firm. Key benchmark indices in Hong Kong, Japan, Singapore and
South Korea were up by between 1.55% and 3.39%. However Taiwan's
Taiwan Weighted was down 0.04% despite announcing 25 basis points
cut in interest rates for the fourth time in two months after
exports dropped in October 2008 by most in three years.
Trading in US index futures indicated the Dow will rise 126 points
at the opening bell.
Economic officials from 20 leading nations called Sunday for
increased government spending to boost the troubled global economy
and said developing countries deserve a prominent role in talks to
overhaul the world financial system. Each country will have to
design its own stimulus package to meet its specific needs, said
David McCormick, the US Treasury's undersecretary for international
affairs.
President-elect Barack Obama on Friday, 7 November 2008, vowed to
act swiftly to address the global financial crisis.
At 11:29 IST, the BSE 30-share Sensex was up 290.50 points, or
2.92%, to 10,254.70. The Sensex opened 190.27 points higher at
10,154.56. The Sensex rose 298.67 points at the day�s high of
10,262.96 in mid-morning trade. At the day�s low of 10,095.90,
the Sensex rose 131.61 points in early trade.
The S&P CNX Nifty gained 92.50 points, or 3.11%, to 3,065.50
The market breadth, indicating the overall health of the market,
was strong on BSE with 1440 shares advancing as compared with 616
that declined. 6 shares remained unchanged.
The total turnover on the BSE amounted to Rs 1045 crore by 11:30
IST as copmpared to Rs 330 crore by 10:30 IST
Among the 30-member Sensex pack, 27 advanced while the rest
declined.
Capital goods shares spurted on renewed buying with the BSE capital
goods index advancing 4.38% to 7,970.08 and was the second biggest
gainer among the BSE sectoral indices.
Indian top engineering and construction firm by sales Larsen &
Toubro surged 5.66% to Rs 920.65 after its consortium with
Malaysia's Scomi Engineering Bhd won an order worth Rs 2460 crore.
Bharat Heavy Electricals, the country's largest power equipment
maker by sales gained 5.70% to Rs 1485.25
Metal shares dominated the list of Sensex gainers on hopes Chinese
demand will rise after the stimulus package.
India�s top aluminium and copper producer by sales, Sterlite
Industries jumped 11.76% to Rs 275.10 on 5.26 lakh shares. It was
the top gainer from the Sensex pack.
Tata Steel (up 9.73% to Rs 208.60) and Hindalco Industries (up
4.22% to Rs 63), were the other gainers from the metal pack.
India�s largest private sector company by market capitalization
and oil refiner Reliance Industries (RIL) advanced 4.41% to Rs
1272.50, ahead of verdict on the gas dispute case hearing with
National Thermal Power Corporation on 11 November 2008. The later
rose 4.86% to Rs 158.25
Reliance Infrastructure (up 6.26% to Rs 596.55), Jaiprakash
Associates (up 4.79% to Rs 91.90), and ICICI Bank (up 5.51% to Rs
455), were the other gainers from the Sensex pack.
Auto stocks were mixed after latest data showed fall in sales in
key segments in the month just gone by. India's top small car maker
by sales Maruti Suzuki India lost 1.20% to Rs 590.50 and was the
top loser from the Sensex pack.
Mahindra & Mahindra (up 0.10% to Rs 372.50), and Tata Motors (up
3.15% to Rs 163.90) rose on bargain hunting.
According to the figures released by the Society of Indian
Automobile Manufacturers (Siam), passenger car sales declined 6.6%
to 98,900 units in October 2008 over October 2007. Sales of trucks
and buses fell 35.9% to 28,027 units.
IT pivotals were mixed as gains in rupee were offset by firm
American depository receipts' (ADR) on Friday, 7 November 2008 on
the New York Stock Exchange. The partially convertible rupee was at
47.20/21 per dollar, nearly 1% stronger than Friday's close of
47.65/66 per dollar. A rise in rupee impacts margins at IT pivotals
who derive a lion's share from exports to the US. The BSE IT index
was up 0.12% to 2,673.70
India's third largest IT exporter by sales Satyam Computer Services
rose 1.85% to Rs 282.15 as ADR jumped 10.64% and India's fourth
largest IT exporter by sales Wipro rose 1.36% to Rs 264.20 as ADR
advanced 6.51%, on the New York Stock Exchange on Friday, 7
November 2008.
However India's second largest IT exporter by sales Infosys slipped
0.69% to Rs 1253, despite ADR surging 7.97% on the New York Stock
Exchange on Friday, 7 November 2008.
India's largest IT exporter by sales Tata Consultancy Services fell
0.44% to Rs 522.25.
Aurobindo Pharma surged 4.29% to Rs 118 on receiving final approval
from the US Food & Drug Administration for manufacturing and
marketing Sertraline hydrochloride in 20 miligram strength. The
company made this announcement after trading hours on Friday, 7
November 2008.
Suzlon Energy declined 3.25% to Rs 68.40 after credit rating agency
CRISIL cut outlook on rating of the companyâ€(TM)s long-term bank
facilities to negative from stable.
US light crude for December 2008 delivery rose $2.86 to $63.90 a
barrel, today, 10 November 2008, rebounding after sliding on
Friday, 7 November 2008, to a 1-1/2-year low below $60, on the back
top exporter Saudi Arabia's plans to cut December 2008 supplies to
Asia, a weaker dollar and hopes that global economies' plans to
lift growth could avert recession.
US stocks rose on Friday as bargain hunters scooped up shares at
multiyear lows after a big drop in the October 2008 payrolls was
less dire than feared. The Dow Jones industrial average jumped
248.02 points, or 2.85%, to 8,943.81. The S&P 500 index advanced
26.11 points, or 2.89%, to 930.99, and the Nasdaq composite index
added 38.70 pints, or 2.41%, to 1,647.40.
Back home, the 30-share BSE Sensex had risen 230.07 points or 2.36%
at 9,964.29 and the 50-unit S&P Nifty had gained 80.35 points or
2.78% to 2,973 on Friday, 7 November 2008 after data showed rise in
infrastructure sector output and on positive global cues.
Foreign institutional investors (FIIs) were net sellers worth Rs
19.27 crore while mutual funds sold shares worth Rs 147.08 crore on
Friday, 7 November 2008, according to provisional data on NSE.
ONGC spurted 4.93% to Rs 778.15 at 10:57 IST on BSE, snapping three
sessions of losses after its chief said that company was looking
for more acquisitions. Media reports quoted ONGC's chairman RS
Sharma on Saturday, 8 November 2008, as saying that ONGC was not
facing cash flow problems and was still looking for acquisition
opportunities despite the global financial crisis. Sharma added
that ONGC was looking at possible acquisitions in Africa and Latin
America.
early gains after opening on a buoyant note tracking gains in Asian
stocks and higher US index futures. Capital goods and metal stocks
were in demand. The market breadth was strong.
China�s Shanghai Composite surged 4.44% after the government on
Sunday, 9 November 2008, announced $586 billion in infrastructure
and public welfare spending to slow the crisis's impact on its
economy, the world's fourth-largest. Other Asian markets, too, were
firm. Key benchmark indices in Hong Kong, Japan, Singapore and
South Korea were up by between 1.55% and 3.39%. However Taiwan's
Taiwan Weighted was down 0.04% despite announcing 25 basis points
cut in interest rates for the fourth time in two months after
exports dropped in October 2008 by most in three years.
Trading in US index futures indicated the Dow will rise 126 points
at the opening bell.
Economic officials from 20 leading nations called Sunday for
increased government spending to boost the troubled global economy
and said developing countries deserve a prominent role in talks to
overhaul the world financial system. Each country will have to
design its own stimulus package to meet its specific needs, said
David McCormick, the US Treasury's undersecretary for international
affairs.
President-elect Barack Obama on Friday, 7 November 2008, vowed to
act swiftly to address the global financial crisis.
At 11:29 IST, the BSE 30-share Sensex was up 290.50 points, or
2.92%, to 10,254.70. The Sensex opened 190.27 points higher at
10,154.56. The Sensex rose 298.67 points at the day�s high of
10,262.96 in mid-morning trade. At the day�s low of 10,095.90,
the Sensex rose 131.61 points in early trade.
The S&P CNX Nifty gained 92.50 points, or 3.11%, to 3,065.50
The market breadth, indicating the overall health of the market,
was strong on BSE with 1440 shares advancing as compared with 616
that declined. 6 shares remained unchanged.
The total turnover on the BSE amounted to Rs 1045 crore by 11:30
IST as copmpared to Rs 330 crore by 10:30 IST
Among the 30-member Sensex pack, 27 advanced while the rest
declined.
Capital goods shares spurted on renewed buying with the BSE capital
goods index advancing 4.38% to 7,970.08 and was the second biggest
gainer among the BSE sectoral indices.
Indian top engineering and construction firm by sales Larsen &
Toubro surged 5.66% to Rs 920.65 after its consortium with
Malaysia's Scomi Engineering Bhd won an order worth Rs 2460 crore.
Bharat Heavy Electricals, the country's largest power equipment
maker by sales gained 5.70% to Rs 1485.25
Metal shares dominated the list of Sensex gainers on hopes Chinese
demand will rise after the stimulus package.
India�s top aluminium and copper producer by sales, Sterlite
Industries jumped 11.76% to Rs 275.10 on 5.26 lakh shares. It was
the top gainer from the Sensex pack.
Tata Steel (up 9.73% to Rs 208.60) and Hindalco Industries (up
4.22% to Rs 63), were the other gainers from the metal pack.
India�s largest private sector company by market capitalization
and oil refiner Reliance Industries (RIL) advanced 4.41% to Rs
1272.50, ahead of verdict on the gas dispute case hearing with
National Thermal Power Corporation on 11 November 2008. The later
rose 4.86% to Rs 158.25
Reliance Infrastructure (up 6.26% to Rs 596.55), Jaiprakash
Associates (up 4.79% to Rs 91.90), and ICICI Bank (up 5.51% to Rs
455), were the other gainers from the Sensex pack.
Auto stocks were mixed after latest data showed fall in sales in
key segments in the month just gone by. India's top small car maker
by sales Maruti Suzuki India lost 1.20% to Rs 590.50 and was the
top loser from the Sensex pack.
Mahindra & Mahindra (up 0.10% to Rs 372.50), and Tata Motors (up
3.15% to Rs 163.90) rose on bargain hunting.
According to the figures released by the Society of Indian
Automobile Manufacturers (Siam), passenger car sales declined 6.6%
to 98,900 units in October 2008 over October 2007. Sales of trucks
and buses fell 35.9% to 28,027 units.
IT pivotals were mixed as gains in rupee were offset by firm
American depository receipts' (ADR) on Friday, 7 November 2008 on
the New York Stock Exchange. The partially convertible rupee was at
47.20/21 per dollar, nearly 1% stronger than Friday's close of
47.65/66 per dollar. A rise in rupee impacts margins at IT pivotals
who derive a lion's share from exports to the US. The BSE IT index
was up 0.12% to 2,673.70
India's third largest IT exporter by sales Satyam Computer Services
rose 1.85% to Rs 282.15 as ADR jumped 10.64% and India's fourth
largest IT exporter by sales Wipro rose 1.36% to Rs 264.20 as ADR
advanced 6.51%, on the New York Stock Exchange on Friday, 7
November 2008.
However India's second largest IT exporter by sales Infosys slipped
0.69% to Rs 1253, despite ADR surging 7.97% on the New York Stock
Exchange on Friday, 7 November 2008.
India's largest IT exporter by sales Tata Consultancy Services fell
0.44% to Rs 522.25.
Aurobindo Pharma surged 4.29% to Rs 118 on receiving final approval
from the US Food & Drug Administration for manufacturing and
marketing Sertraline hydrochloride in 20 miligram strength. The
company made this announcement after trading hours on Friday, 7
November 2008.
Suzlon Energy declined 3.25% to Rs 68.40 after credit rating agency
CRISIL cut outlook on rating of the companyâ€(TM)s long-term bank
facilities to negative from stable.
US light crude for December 2008 delivery rose $2.86 to $63.90 a
barrel, today, 10 November 2008, rebounding after sliding on
Friday, 7 November 2008, to a 1-1/2-year low below $60, on the back
top exporter Saudi Arabia's plans to cut December 2008 supplies to
Asia, a weaker dollar and hopes that global economies' plans to
lift growth could avert recession.
US stocks rose on Friday as bargain hunters scooped up shares at
multiyear lows after a big drop in the October 2008 payrolls was
less dire than feared. The Dow Jones industrial average jumped
248.02 points, or 2.85%, to 8,943.81. The S&P 500 index advanced
26.11 points, or 2.89%, to 930.99, and the Nasdaq composite index
added 38.70 pints, or 2.41%, to 1,647.40.
Back home, the 30-share BSE Sensex had risen 230.07 points or 2.36%
at 9,964.29 and the 50-unit S&P Nifty had gained 80.35 points or
2.78% to 2,973 on Friday, 7 November 2008 after data showed rise in
infrastructure sector output and on positive global cues.
Foreign institutional investors (FIIs) were net sellers worth Rs
19.27 crore while mutual funds sold shares worth Rs 147.08 crore on
Friday, 7 November 2008, according to provisional data on NSE.
ONGC spurted 4.93% to Rs 778.15 at 10:57 IST on BSE, snapping three
sessions of losses after its chief said that company was looking
for more acquisitions. Media reports quoted ONGC's chairman RS
Sharma on Saturday, 8 November 2008, as saying that ONGC was not
facing cash flow problems and was still looking for acquisition
opportunities despite the global financial crisis. Sharma added
that ONGC was looking at possible acquisitions in Africa and Latin
America.
Sensex spurts above 10,000 mark in opening trade
Key benchmark indices opened on a buoyant note tracking positive
Asian stocks and firm US index futures after China announced a $586
billion package to revive growth in the world's fourth-largest
economy. The BSE Sensex surged past the 10,000 mark and the S&P CNX
Nifty raced past the 3,000 mark in opening trade. Metal stocks
rallied on hopes Chinese demand will rise after the stimulus
package.
The Dow and Nasdaq futures were up 1.40% and 1.44% respectively,
indicating firm start today, 10 November 2008.
Most Asian markets were trading firm today, 10 November 2008.
China's Shanghai Composite surged 4.98% after it announced a
massive economic stimulus package worth $586 billion in an attempt
to bolster its weakening economy. The government has also promised
to loosen credit conditions and cut taxes.
Key benchmark indices in Hong Kong, Japan, Singapore and South
Korea were up by between 0.94% and 5.11%. However Taiwan's Taiwan
Weighted was down 0.76% despite announcing 25 basis points cut in
interest rates for the fourth time in two months after exports
dropped in October 2008 by most in three years.
At 10:25 IST, the BSE 30-share Sensex was up 203.75 points, or
2.04%, to 10,168.04. The Sensex opened 190.27 points higher at
10,154.56. The Sensex rose 316.68 points at the day's high of
10,280.97. At the day's low of 10,095.90, the Sensex rose 131.61
points.
The S&P CNX Nifty gained 64.85 points, or 2.12%, to 3,036
The market breadth, indicating the overall health of the market,
was strong on BSE with 980 shares advancing as compared with 341
that declined. 34 shares remained unchanged.
The total turnover on the BSE amounted to Rs 330 crore by 10:30 IST
Among the 30-member Sensex pack, 26 advanced while the rest
declined.
Metal shares dominated the list of Sensex gainers surged on hopes
Chinese demand will rise after the stimulus package, with the BSE
Metal index advancing 5.91% to 5,456.76, the most among BSE
sectoral indices,
India's top aluminium and copper producer by sales, Sterlite
Industries jumped 8.88% to Rs 268 on 2.32 lakh shares. It was the
top gainer from the Sensex pack.
Tata Steel (up 4.71% to Rs 199.05) and Hindalco Industries (up
4.22% to Rs 63), were the other gainers from the metal pack.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) advanced 2.89% to Rs 1253
Jqaiprakash Associates (up 3.93% to Rs 91.05), ONGC (up 4.11% to Rs
772.05), and ICICI Bank (up 3.42% to Rs 446), edged higher from the
Sensex pack.
Auto stocks were mixed after latest data showing fall in October
2008 sales. Maruti Suzuki India (down 1.78% to Rs 587) and Mahindra
& Mahindra (down 1.52% to Rs 366.60), slipped
However India's top truck maker by sales Tata Motors rose 1.13% to
Rs 160.70.
According to the figures released by the Society of Indian
Automobile Manufacturers (Siam), passenger car sales declined 6.6%
to 98,900 units in October 2008 over October 2007. Sales of trucks
and buses fell 35.9% to 28,027 units.
HDFC Bank, the country's largest private sector bank by market
capitalisation lost 2.62% to Rs 1060.95 and was the top loser from
Sensex pack.
Reliance Communications (down 1.21% to Rs 225.40), and TCS (down
0.87% to Rs 520), edged lower from Sensex pack.
Among the side counters, Firstsource (up 15.54% to Rs 19.70),
Arvind Mills (up 16.57% to Rs 19.01), and Aurobindo Pharma (up
13.48% to Rs 128.40), surged.
US markets surged on Friday, 7 November 2008 despite another round
of weak economic and earnings data on speculation that the federal
reserve will lower interest rates, after traders shrugged off a
bigger than expected loss in jobs. Nonfarm payrolls declined
240,000 in October 2008, lifting the unemployment rate to a 14-year
high of 6.5%. President-elect Obama said America needs a rescue
plan for the middle class, including a fiscal stimulus plan.
The Dow Jones industrial average jumped 248.02 points, or 2.85%, to
8,943.81. The S&P 500 index advanced 26.11 points, or 2.89%, to
930.99, and the Nasdaq composite index added 38.70 pints, or 2.41%,
to 1,647.40.
Back home, the 30-share BSE Sensex was up 230.07 points or 2.36% at
9,964.29 and the 50-unit S&P Nifty was up 80.35 points or 2.78% to
2,973 on Friday, 7 November 2008 after data showed rise in
infrastructure sector output and positive global cues.
US light crude for December 2008 delivery rose $2.86 to $63.90 a
barrel, today, 10 November 2008, rebounding after sliding on
Friday, 7 November 2008, to a 1-1/2-year low below $60, fuelled by
top exporter Saudi Arabia's plans to cut December 2008 supplies to
Asia, a weaker dollar and hopes that global economies' plans to
lift growth could avert recession.
Foreign institutional investors (FIIs) were net sellers worth Rs
19.27 crore while mutual funds sold shares worth Rs 147.08 crore on
Friday, 7 November 2008, according to provisional data on NSE.
Asian stocks and firm US index futures after China announced a $586
billion package to revive growth in the world's fourth-largest
economy. The BSE Sensex surged past the 10,000 mark and the S&P CNX
Nifty raced past the 3,000 mark in opening trade. Metal stocks
rallied on hopes Chinese demand will rise after the stimulus
package.
The Dow and Nasdaq futures were up 1.40% and 1.44% respectively,
indicating firm start today, 10 November 2008.
Most Asian markets were trading firm today, 10 November 2008.
China's Shanghai Composite surged 4.98% after it announced a
massive economic stimulus package worth $586 billion in an attempt
to bolster its weakening economy. The government has also promised
to loosen credit conditions and cut taxes.
Key benchmark indices in Hong Kong, Japan, Singapore and South
Korea were up by between 0.94% and 5.11%. However Taiwan's Taiwan
Weighted was down 0.76% despite announcing 25 basis points cut in
interest rates for the fourth time in two months after exports
dropped in October 2008 by most in three years.
At 10:25 IST, the BSE 30-share Sensex was up 203.75 points, or
2.04%, to 10,168.04. The Sensex opened 190.27 points higher at
10,154.56. The Sensex rose 316.68 points at the day's high of
10,280.97. At the day's low of 10,095.90, the Sensex rose 131.61
points.
The S&P CNX Nifty gained 64.85 points, or 2.12%, to 3,036
The market breadth, indicating the overall health of the market,
was strong on BSE with 980 shares advancing as compared with 341
that declined. 34 shares remained unchanged.
The total turnover on the BSE amounted to Rs 330 crore by 10:30 IST
Among the 30-member Sensex pack, 26 advanced while the rest
declined.
Metal shares dominated the list of Sensex gainers surged on hopes
Chinese demand will rise after the stimulus package, with the BSE
Metal index advancing 5.91% to 5,456.76, the most among BSE
sectoral indices,
India's top aluminium and copper producer by sales, Sterlite
Industries jumped 8.88% to Rs 268 on 2.32 lakh shares. It was the
top gainer from the Sensex pack.
Tata Steel (up 4.71% to Rs 199.05) and Hindalco Industries (up
4.22% to Rs 63), were the other gainers from the metal pack.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries (RIL) advanced 2.89% to Rs 1253
Jqaiprakash Associates (up 3.93% to Rs 91.05), ONGC (up 4.11% to Rs
772.05), and ICICI Bank (up 3.42% to Rs 446), edged higher from the
Sensex pack.
Auto stocks were mixed after latest data showing fall in October
2008 sales. Maruti Suzuki India (down 1.78% to Rs 587) and Mahindra
& Mahindra (down 1.52% to Rs 366.60), slipped
However India's top truck maker by sales Tata Motors rose 1.13% to
Rs 160.70.
According to the figures released by the Society of Indian
Automobile Manufacturers (Siam), passenger car sales declined 6.6%
to 98,900 units in October 2008 over October 2007. Sales of trucks
and buses fell 35.9% to 28,027 units.
HDFC Bank, the country's largest private sector bank by market
capitalisation lost 2.62% to Rs 1060.95 and was the top loser from
Sensex pack.
Reliance Communications (down 1.21% to Rs 225.40), and TCS (down
0.87% to Rs 520), edged lower from Sensex pack.
Among the side counters, Firstsource (up 15.54% to Rs 19.70),
Arvind Mills (up 16.57% to Rs 19.01), and Aurobindo Pharma (up
13.48% to Rs 128.40), surged.
US markets surged on Friday, 7 November 2008 despite another round
of weak economic and earnings data on speculation that the federal
reserve will lower interest rates, after traders shrugged off a
bigger than expected loss in jobs. Nonfarm payrolls declined
240,000 in October 2008, lifting the unemployment rate to a 14-year
high of 6.5%. President-elect Obama said America needs a rescue
plan for the middle class, including a fiscal stimulus plan.
The Dow Jones industrial average jumped 248.02 points, or 2.85%, to
8,943.81. The S&P 500 index advanced 26.11 points, or 2.89%, to
930.99, and the Nasdaq composite index added 38.70 pints, or 2.41%,
to 1,647.40.
Back home, the 30-share BSE Sensex was up 230.07 points or 2.36% at
9,964.29 and the 50-unit S&P Nifty was up 80.35 points or 2.78% to
2,973 on Friday, 7 November 2008 after data showed rise in
infrastructure sector output and positive global cues.
US light crude for December 2008 delivery rose $2.86 to $63.90 a
barrel, today, 10 November 2008, rebounding after sliding on
Friday, 7 November 2008, to a 1-1/2-year low below $60, fuelled by
top exporter Saudi Arabia's plans to cut December 2008 supplies to
Asia, a weaker dollar and hopes that global economies' plans to
lift growth could avert recession.
Foreign institutional investors (FIIs) were net sellers worth Rs
19.27 crore while mutual funds sold shares worth Rs 147.08 crore on
Friday, 7 November 2008, according to provisional data on NSE.
Pre Market Report 10/11/2008
Key benchmark indices are likely to extend Friday's, 7 November 2008 gains tracking firm Asian indices boosted by China's nearly $600 billion spending plan to spur the economy. US markets had also rallied on Friday, 7 November 2008. SGX Nifty futures for November 2008 delivery added 42 points in Singapore.
Asian markets advanced today, 10 November 2008 led by China's Shanghai Composite which surged 6.15% to 1,855.16 after it announced a massive economic stimulus package worth $586 billion in an attempt to bolster its weakening economy. The government has also promised to loosen credit conditions and cut taxes. Taiwan's Taiwan Weighted was up 0.05% at 4,744.64 despite announcing 25 basis points cut in interest rates for the fourth time in two months after exports dropped in October 2008 by most in three years.
Hong Kong's Hang Seng added 5.97% or 850.44 points at 15,093.87, Japan's Nikkei rose 5.49% or 470.90 points at 9,053.90, Singapore's Straits Times gained 1.41% or 26.21 points at 1,889.70, and South Korea's Seoul Composite advanced 1.80% or 20.41 points at 1,154.90.
US markets surged on Friday, 7 November 2008 despite another round of weak economic and earnings data on speculation that the federal reserve will lower interest rates, after traders shrugged off a bigger than expected loss in jobs. Nonfarm payrolls declined 240,000 in October 2008, lifting the unemployment rate to a 14-year high of 6.5%. President-elect Obama said America needs a rescue plan for the middle class, including a fiscal stimulus plan.
The Dow Jones industrial average jumped 248.02 points, or 2.85%, to 8,943.81. The S&P 500 index advanced 26.11 points, or 2.89%, to 930.99, and the Nasdaq composite index added 38.70 pints, or 2.41%, to 1,647.40.
Back home, the 30-share BSE Sensex was up 230.07 points or 2.36% at 9,964.29 and the 50-unit S&P Nifty was up 80.35 points or 2.78% to 2,973 on Friday, 7 November 2008 after data showed rise in infrastructure sector output and positive global cues.
Key benchmark indices eked out gains in the week ended Friday, 7 November 2008, ending six-week loosing streak helped by global central bank measures to tackle the turmoil in the financial markets. The BSE 30-share Sensex rose 176.23 points or 1.80% to 9,964.29 in the week ended Friday, 7 November 2008. The S&P CNX Nifty gained 87.30 points or 3.02% to 2,973 in the week.
US light crude for December 2008 delivery rose $2.96 to $64 a barrel, today, 10 November 2008 fuelled by top exporter Saudi Arabia's plans to cut December 2008 supplies to Asia, a weaker dollar and hopes that global economies' plans to lift growth could avert recession.
Asian markets advanced today, 10 November 2008 led by China's Shanghai Composite which surged 6.15% to 1,855.16 after it announced a massive economic stimulus package worth $586 billion in an attempt to bolster its weakening economy. The government has also promised to loosen credit conditions and cut taxes. Taiwan's Taiwan Weighted was up 0.05% at 4,744.64 despite announcing 25 basis points cut in interest rates for the fourth time in two months after exports dropped in October 2008 by most in three years.
Hong Kong's Hang Seng added 5.97% or 850.44 points at 15,093.87, Japan's Nikkei rose 5.49% or 470.90 points at 9,053.90, Singapore's Straits Times gained 1.41% or 26.21 points at 1,889.70, and South Korea's Seoul Composite advanced 1.80% or 20.41 points at 1,154.90.
US markets surged on Friday, 7 November 2008 despite another round of weak economic and earnings data on speculation that the federal reserve will lower interest rates, after traders shrugged off a bigger than expected loss in jobs. Nonfarm payrolls declined 240,000 in October 2008, lifting the unemployment rate to a 14-year high of 6.5%. President-elect Obama said America needs a rescue plan for the middle class, including a fiscal stimulus plan.
The Dow Jones industrial average jumped 248.02 points, or 2.85%, to 8,943.81. The S&P 500 index advanced 26.11 points, or 2.89%, to 930.99, and the Nasdaq composite index added 38.70 pints, or 2.41%, to 1,647.40.
Back home, the 30-share BSE Sensex was up 230.07 points or 2.36% at 9,964.29 and the 50-unit S&P Nifty was up 80.35 points or 2.78% to 2,973 on Friday, 7 November 2008 after data showed rise in infrastructure sector output and positive global cues.
Key benchmark indices eked out gains in the week ended Friday, 7 November 2008, ending six-week loosing streak helped by global central bank measures to tackle the turmoil in the financial markets. The BSE 30-share Sensex rose 176.23 points or 1.80% to 9,964.29 in the week ended Friday, 7 November 2008. The S&P CNX Nifty gained 87.30 points or 3.02% to 2,973 in the week.
US light crude for December 2008 delivery rose $2.96 to $64 a barrel, today, 10 November 2008 fuelled by top exporter Saudi Arabia's plans to cut December 2008 supplies to Asia, a weaker dollar and hopes that global economies' plans to lift growth could avert recession.
Sunday, November 9, 2008
19 American banks go bust in ’08
Ravaged by the financial turmoil, the world’s largest economy, the US,
has this year seen the failure of as many as 19 banks - exactly half
the number of all publicly-listed banks in India.
According to the Federal Deposit Insurance Corporation, the US
regulatory body, which is often appointed as the receiver for failed
banks, the number of bank-failures in the past eight years has grown
to 46 - which is more than the total of 38 banks listed on the Indian
bourses.
Nearly half of the failures has been during the ongoing turmoil in the
US financial market, with a total of 21 banks having failed since
September last year and 19 since January this year, the FDIC data
shows.
The current year has already seen the highest number of bank failures
in the midst of the United States grappling with one of the worst
economic crisis since the Great Depression of 1930s.
Prior to 2008, the highest number of bank collapses was recorded in
2002, when 11 such entities failed.
In India, there are a total of 38 banks listed on the stock exchange,
which include 18 from the private sector and 20 from the public
sector.
On Friday, Houston-based Franklin Bank SSB and Security Pacific Bank
in Los Angeles became the latest bank failures in the US, forcing
state authorities to take them under their control.
Since August 2008 as many as 12 banks have gone bust - a period when
the current financial turbulence began to squeeze the economy.
They include Freedom Bank, Alpha Bank & Trust, Meridian Bank, Main
Street Bank, Washington Mutual Bank, Ameribank, Silver State Bank,
Integrity Bank, The Columbian Bank and Trust and First Priority Bank.
Before August this year, seven banks - First Heritage Bank, First
National Bank of Nevada, IndyMac Bank, First Integrity Bank, ANB
Financial, Hume Bank and Douglass National Bank - had collapsed.
Going by the FDIC data, there were no bank failures in 2005 and 2006.
On the other hand, only two banks had failed in 2000, the lowest
number in last eight years.
In 2007, just three banks failed in the country - Miami Valley Bank,
NetBank and Metropolitan Savings Bank.
The fall of Washington Mutual, the country’s largest savings and loan
entity, is one of the biggest bank failures this year. Better known as
WaMu, its larger rival JPMorgan Chase agreed to acquire the entity in
September.
JPMorgan bought deposits and branches of WaMu for about $1.9 billion,
in a deal brokered by the Federal administration.
Going by the available data, Bank of Honolulu and National State Bank
of Metropolis went bust in 2001.
Then next year, four banks collapsed - First Alliance Bank & Trust
Company, The Malta National Bank, Superior Bank and Sinclair National
Bank.
In 2003 and 2004, the number of banks which failed stood at seven.
They are Southern Pacific Bank, The First National Bank of
Blanchardville, Pulaski Savings Bank, Dollar Savings Bank, Guaranty
National Bank of Tallahassee, Reliance Bank and Bank of Ephraim.
has this year seen the failure of as many as 19 banks - exactly half
the number of all publicly-listed banks in India.
According to the Federal Deposit Insurance Corporation, the US
regulatory body, which is often appointed as the receiver for failed
banks, the number of bank-failures in the past eight years has grown
to 46 - which is more than the total of 38 banks listed on the Indian
bourses.
Nearly half of the failures has been during the ongoing turmoil in the
US financial market, with a total of 21 banks having failed since
September last year and 19 since January this year, the FDIC data
shows.
The current year has already seen the highest number of bank failures
in the midst of the United States grappling with one of the worst
economic crisis since the Great Depression of 1930s.
Prior to 2008, the highest number of bank collapses was recorded in
2002, when 11 such entities failed.
In India, there are a total of 38 banks listed on the stock exchange,
which include 18 from the private sector and 20 from the public
sector.
On Friday, Houston-based Franklin Bank SSB and Security Pacific Bank
in Los Angeles became the latest bank failures in the US, forcing
state authorities to take them under their control.
Since August 2008 as many as 12 banks have gone bust - a period when
the current financial turbulence began to squeeze the economy.
They include Freedom Bank, Alpha Bank & Trust, Meridian Bank, Main
Street Bank, Washington Mutual Bank, Ameribank, Silver State Bank,
Integrity Bank, The Columbian Bank and Trust and First Priority Bank.
Before August this year, seven banks - First Heritage Bank, First
National Bank of Nevada, IndyMac Bank, First Integrity Bank, ANB
Financial, Hume Bank and Douglass National Bank - had collapsed.
Going by the FDIC data, there were no bank failures in 2005 and 2006.
On the other hand, only two banks had failed in 2000, the lowest
number in last eight years.
In 2007, just three banks failed in the country - Miami Valley Bank,
NetBank and Metropolitan Savings Bank.
The fall of Washington Mutual, the country’s largest savings and loan
entity, is one of the biggest bank failures this year. Better known as
WaMu, its larger rival JPMorgan Chase agreed to acquire the entity in
September.
JPMorgan bought deposits and branches of WaMu for about $1.9 billion,
in a deal brokered by the Federal administration.
Going by the available data, Bank of Honolulu and National State Bank
of Metropolis went bust in 2001.
Then next year, four banks collapsed - First Alliance Bank & Trust
Company, The Malta National Bank, Superior Bank and Sinclair National
Bank.
In 2003 and 2004, the number of banks which failed stood at seven.
They are Southern Pacific Bank, The First National Bank of
Blanchardville, Pulaski Savings Bank, Dollar Savings Bank, Guaranty
National Bank of Tallahassee, Reliance Bank and Bank of Ephraim.
US car giants report large losses
US carmaker GM has reported a third quarter operating loss of $4.2bn
(£2.66bn) after Ford announced it lost $2.98bn during the same
period.
GM said it would run out of cash in the first half of 2009 if economic
and market conditions did not improve.
GM said it would cut jobs and costs and has also suspended merger
talks with Chrysler to focus on current issues.
It says about 3,600 workers will be laid off indefinitely early next
year as production is slowed at 10 plants.
Ford meanwhile said it would cut salary-related expenses in North
America by another 10%.
GM and Ford burned though $14.6bn in cash between them in the quarter.
No acquisition
Detroit-based GM posted a third-quarter net loss of $2.5bn, compared
with a loss from continuing operations of $42.5bn a year ago.
Revenue fell to $37.9bn from $43.7bn in the same period in 2007. GM
said it would shed white-collar jobs and cut $2.5bn in capital
spending in 2009.
Although in its statement it did not specifically refer to Chrysler,
GM said it was setting aside considerations for a "strategic
acquisition".
Meanwhile Ford's revenues fell to $32.1bn, down from $41.1bn in the
third quarter of 2007, as vehicle sales in the US plunged to historic
lows.
Ford, which will accelerate plans to produce fuel-efficient cars, said
it was looking at various solutions to support its balance sheet
(£2.66bn) after Ford announced it lost $2.98bn during the same
period.
GM said it would run out of cash in the first half of 2009 if economic
and market conditions did not improve.
GM said it would cut jobs and costs and has also suspended merger
talks with Chrysler to focus on current issues.
It says about 3,600 workers will be laid off indefinitely early next
year as production is slowed at 10 plants.
Ford meanwhile said it would cut salary-related expenses in North
America by another 10%.
GM and Ford burned though $14.6bn in cash between them in the quarter.
No acquisition
Detroit-based GM posted a third-quarter net loss of $2.5bn, compared
with a loss from continuing operations of $42.5bn a year ago.
Revenue fell to $37.9bn from $43.7bn in the same period in 2007. GM
said it would shed white-collar jobs and cut $2.5bn in capital
spending in 2009.
Although in its statement it did not specifically refer to Chrysler,
GM said it was setting aside considerations for a "strategic
acquisition".
Meanwhile Ford's revenues fell to $32.1bn, down from $41.1bn in the
third quarter of 2007, as vehicle sales in the US plunged to historic
lows.
Ford, which will accelerate plans to produce fuel-efficient cars, said
it was looking at various solutions to support its balance sheet
Saturday, November 8, 2008
Regulators shut banks in Texas, California
WASHINGTON (AP) -- Regulators shut down Houston-based Franklin Bank
and Security Pacific Bank in Los Angeles on Friday, bringing the
number of failures of federally insured banks this year to 19.
The Federal Deposit Insurance Corp. was appointed receiver of Franklin
Bank, which had $5.1 billion in assets and $3.7 billion in deposits as
of Sept. 30, and of Security Pacific Bank, with $561.1 million in
assets and $450.1 million in deposits as of Oct. 17
The co-founder and chairman of parent Franklin Bank Corp., Lewis
Ranieri, is credited with inventing mortgage-backed securities two
decades ago, but apparently was unable to save his own company from
getting ensnared in the home-loan bust.
The bank's failure is a bitter irony because it is the mortgage
securitization business of which Ranieri is known as a pioneer -- the
repackaging of home loans as bonds that are sold to investors -- that
was at the heart of the mortgage and credit crises. Last spring, the
audit committee of the company's board found in an investigation
certain weaknesses in accounting, disclosure and other issues relating
to residential real estate loans.
Franklin Bank Corp. just Sunday said it had received proposals for
transactions to strengthen Franklin Bank's capital position and was
keeping regulators informed of the talks' progress.
and Security Pacific Bank in Los Angeles on Friday, bringing the
number of failures of federally insured banks this year to 19.
The Federal Deposit Insurance Corp. was appointed receiver of Franklin
Bank, which had $5.1 billion in assets and $3.7 billion in deposits as
of Sept. 30, and of Security Pacific Bank, with $561.1 million in
assets and $450.1 million in deposits as of Oct. 17
The co-founder and chairman of parent Franklin Bank Corp., Lewis
Ranieri, is credited with inventing mortgage-backed securities two
decades ago, but apparently was unable to save his own company from
getting ensnared in the home-loan bust.
The bank's failure is a bitter irony because it is the mortgage
securitization business of which Ranieri is known as a pioneer -- the
repackaging of home loans as bonds that are sold to investors -- that
was at the heart of the mortgage and credit crises. Last spring, the
audit committee of the company's board found in an investigation
certain weaknesses in accounting, disclosure and other issues relating
to residential real estate loans.
Franklin Bank Corp. just Sunday said it had received proposals for
transactions to strengthen Franklin Bank's capital position and was
keeping regulators informed of the talks' progress.
Friday, November 7, 2008
Post Market Report:07/11/2008
Data showing rise in infrastructure sector output and positive
global cues helped the domestic bourses snap losses in the
preceding two trading session. The BSE Sensex rose 230.07 points or
2.36%. The barometer index breached the psychological 10,000 level
many times in intraday trade though it ended below that level.
Metal stocks rose on recovery in metal prices on the London Metal
Exchange. PSU banks rose on cut in lending rates. IT stocks rose as
a weak rupee offset fall in American depository receipts overnight.
Data showing rise in infrastructure output offset concerns of
economic slowdown triggered by productions cuts announced by
commercial vehicle makers in the last two days and steel maker JSW
Steel today and reduction in gross domestic product (GDP) forecast
for 2009 by the International Monetary Fund. India's infrastructure
sector output grew 5.1% in September 2008 from a year earlier, well
above 2.3% annual growth in August 2008, government data released
earlier in the day showed.
The International Monetary Fund, or IMF, on Thursday, 6 November
2008, predicted lower growth in India and economic contractions in
the US, Japan and euro region next year, calling for further
interest rate cuts and fiscal stimulus. Its estimate for India's
growth in 2009 is now 6.3%, 0.6% lower than its earlier estimate of
6.9% made just a month ago. Its estimate for the country's growth
in 2008 is down 0.1% to 7.8%.
European shares edged higher as commodities stocks tracked stronger
crude and metals prices and banking shares gained following
interest rate cuts in the previous session. Key benchmark indices
in France, Germany and UK were up by between 0.31% to 1.9%. The
Bank of England slashed the key interest rate by a steep 1.5% on
Thursday, 6 November 2008 and on the same day the European Central
Bank cut the key rate by 50 basis points.
Bargain hunting following a 25 basis points rate cut by the central
bank in South Korea on Friday, 7 November 2008, and rate cut in
Europe triggered a recovery in Asian stocks from an intra-day fall.
South Korea's Kospi was up almost 4% boosted by the rate cut. Key
benchmark indices in China, Singapore, Hong Kong, Taiwan, rose by
between 1.034% to 3.29%. Japan's Nikkei average was down 3.55% with
bargain hunting helping the benchmark pared losses that had taken
it down over 6% earlier in the day. The rate cut in Europe were
announced after Asian markets had closed on Thursday, 6 November
2008.
Trading in US index futures indicated the Dow will rise 100 points
at the opening bell.
The 30-share BSE Sensex was up 230.07 points or 2.36% at 9,964.29.
The index rose 331.15 points at the day's high of 10,065.37 in late
trade. The index fell 121 points at the day's low of 9,631.59 hit
in early trade.
The 50-unit S&P Nifty was up 80.35 points or 2.78% to 2,973.
The BSE clocked a turnover of Rs 3447 crore today as compared to a
turnover of Rs 4010.92 crore on 6 November 2008
The market recovered after a sharp slide in the past two trading
sessions. From the recent high of 10631.12 on 4 November 2008 the
Sensex had lost 896.90 points or 8.43% to 9734.22 on 6 November
2008. There has been a massive erosion in investors' wealth this
year. The Sensex is down 10,322.70 points or 50.88% in the calendar
year 2008 so far from its close of 20,286.99 on 31 December 2007.
It is 11,242.48 points or 53.01% below its all-time high of
21,206.77 struck on 10 January 2008.
Nifty November 2008 futures were at 2989.10, at a premium of 16.10
points as compared to spot closing of 2973. NSE's futures & options
(F&O) segment turnover was Rs 36,963.32 crore, which was lower than
Rs 43,836.07 crore on Thursday, 6 November 2008.
The BSE Mid-cap index was up 1.11% to 3,355.38, while the BSE
Small-cap index was up 0.51% to 3,900.10. Both the indices
underperformed the Sensex.
The BSE Power index (up 4.43% to 1,777.57), the BSE Oil & Gas index
(up 3.38% to 6,013.57), the BSE Metal index (up 3.18% to 5,152.33),
the BSE PSU index (up 3.01% to 4,965.80), the BSE Realty index (up
2.72% to 2,342.82) outperformed the Sensex.
The BSE Auto index (up 0.5% to 2,661.53), the BSE HealthCare index
(up 0.54% to 2,937.11), the BSE Consumer Durables index (up 1.29%
to 2,094.87), the BSE Capital Goods index (up 1.61% to 7,635.41),
the BSE Bankex (up 1.66% to 5,532.15), the BSE IT index (up 2.01%
to 2,670.54), the BSE Teck index (up 2.16% to 2,085.84) and BSE
FMCG index (up 2.22% to 1,968.70) underperformed the Sensex.
The market breadth turned positive later in the day from earlier
weak breadth. On BSE, 1124 stocks declined while 1417 gained. 75
stocks remained unchanged.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries rose 3.95% to Rs 1,217.85 despite
reports it may delay commercial operations of its Jamnagar refinery
to early 2009 as it finishes the final testing of the facility.
Reliance Communications (up 5.53% to Rs 228.15), Jaiprakash
Associates (up 4.65% to Rs 87.70) and ITC (up 3.59% to Rs 174.80)
were the major gainers from the Sensex pack.
Power stocks gained. NTPC, Tata Power Company, Reliance
Infrastructure, Reliance Power, Power Grid Corporation of India
rose by between 2.61% to 10.92%.
Metal stocks gained tracking recovery in metal prices on the London
Metal Exchange. Tata Steel, Sterlite Industries, Steel Authority of
India, Hindustan Zinc, National Aluminum Company rose by between
2.07% to 10.68%.
Indiaâ€(TM)s largest aluminum maker by sales, Hindalco Industries
spurted 6.61% on reports the company has cleared the bridge loan
taken to acquire Canada's Novelis. But steel maker JSW Steel
plunged 5.18%, on production cut plan.
Shares of iron ore exporters rose on a television report that the
railway freight rates for iron ore has been cut by 50% from 8
November to 31 December 2008. Sesa Goa rose 3.10% and NMDC gained
2.4%.
The reductions would be applicable for iron ore traffic loaded in
South Eastern, East Coast and South Western Railways and for
distances above 350 kilometer to 400 kilometer
Auto pivotals fell after commercial vehicle makers announced
production cut amid falling demand for vehicles. Ashok Leyland,
India's second-biggest commercial vehicle maker by sales, fell
4.57% on a decision to cut production at its plants to three days a
week until the end of 2008 because of falling demand for its
vehicles.
But India's largest commercial vehicle maker by sales Tata Motors
recovered from the day's low. The stock was down 0.16% to Rs
158.90, off the day's low of Rs 148. Its ADR lost 3.81% overnight
after the company on 6 November 2008 had announced closing of the
commercial vehicle plant at Jamshedpur owing to a demand slump.
The country's largest passenger car maker by sales Maruti Suzuki
fell 0.38%. The company on 1 November 2008 said its sales in
October 2008 dipped 7% at 64,490 units, against 69,415 units in the
same month last year.
Shares of the two-wheeler makers were mixed. Indiaâ€(TM)s largest
motorbike maker by sales Hero Honda Motor rose 4.15%, and TVS Motor
Company fell 1.98%. Indiaâ€(TM)s largest scooter maker by sales Bajaj
Auto was up 0.94%. Last month, reports quoted a senior executive in
Bajaj Auto, India's second biggest motorcycle maker by sales, as
saying that it could cut production in November 2008 after the
festive season.
Meanwhile, the Petroleum Secretary, R S Pandey on Thursday (6
November 2008) said the government was not considering any fuel
price cut at the moment as public sector oil marketing companies
are still incurring revenue loss on sale of various petroleum
products.
Most of the IT stocks spurted after dismal start as a weak rupee
offset slide in weak American depository receipts overnight caused
by worries the US outsourcing business will be curtailed and the
direct impact will be on IT sector after Barack Obama won the US
presidential election early this week. India's third largest IT
exporter by sales Satyam Computer Services rose 3.16% to Rs 277.75,
off the dayâ€(TM)s low of Rs 263. Its American depository receipt
(ADR) fell 7.19% overnight.
India's second largest IT exporter by sales Infosys rose 1.15% to
Rs 1262.50, off the dayâ€(TM)s low of Rs 1205.25 even as ADR fell
10.47%. India's fourth largest IT exporter by sales Wipro rose 2.9%
to Rs 260.45 even as ADR slipped 8.56%. The stock had slipped 6.31%
in previous trading session. India's largest IT exporter by sales
Tata Consultancy Services rose 4.87% to Rs 524.55 off dayâ€(TM)s low
of Rs 485.10. The stock had slipped 1.08% in previous trading
session.
Obama has strong reservations on outsourcing from the US. He had
made many statements during his election speeches that he would
discourage outsourcing from the US when he comes into power.
Meanwhile, the Indian rupee weakened on Friday as expectations of
further foreign investor outflows from the stock market weighed on
sentiment. The partially convertible rupee was at 47.77/78 per
dollar, 0.1 % weaker than 47.66/69 at close on Thursday.
PSU banks rose after top state-owned banks on Thursday, 6 November
2008, cut their prime lending rates (PLR). Bank of Baroda,
Allahabad Bank, Central Bank of India, Oriental Bank of Commerce
and Corporation Bank rose by between 2.09% to 6.21%. All of them
reduced lending rates by 75 bps to 13.25% with effect from 10
November 2008.
India's largest commercial bank State Bank of India (SBI) rose
2.79% on a decision to cut the PLR by 75 basis points (bps) with
effect from 10 November 2008 and deposit rates by 25 to 50 bps
across all maturities effective 1 December 2008.
India's largest private sector bank by net profit ICICI Bank fell
0.67% as American depository receipt (ADR) lost 2.68% overnight.
ICICI Bank's chief executive K.V. Kamath said on 3 November 2008,
the bank will review interest rates in the next few days.
India's second largest private sector bank by net profit HDFC Bank
rose 2.64% to Rs 1,088.55 off dayâ€(TM)s low of Rs 1,032 even as ADR
slumped 4.81% on Thursday.
India's largest home loan lender by operating income HDFC jumped
2.64%. HDFC is yet to revise its rates, since the firm's borrowing
costs have not come down.
The Reserve Bank of India (RBI) on Saturday, 1 November 2008,
unexpectedly cut its main short-term lending rate viz. the repo
rate to ease a growing cash squeeze, spur faltering economic growth
and fend off damage from the global financial crisis.
Meanwhile, inflation based on the wholesale price index rose 10.72%
in the year through 25 October 2008, higher than previous weekâ€(TM)s
10.68% rise.
PSU OMCs rose after the Petroleum Secretary, R.S. Pandey, said, the
government is not considering any fuel price cut at the moment as
public sector oil marketing companies are still incurring revenue
loss on sale of various petroleum products. BPCL, HPCL and Indian
Oil Corporation fell by between 6.85% to 8.94%. Meanwhile, crude
oil rose from a 19-month low in New York as rising stock indexes
allayed concern about waning demand and a weaker dollar bolstered
the appeal of commodities. Oil for December delivery climbed as
much as 2.9%, to $62.50 a barrel on the New York Mercantile
Exchange.
Indiaâ€(TM)s largest state-run oil explorer by market capitalization
ONGC fell 0.29% despite reports Russia has allowed the company to
purchase London-listed Imperial Energy.
India's largest drug maker by sales Ranbaxy Laboratories rose 0.95%
recovering from earlier fall as Daiichi Sankyo Co, Japan's No. 3
drugmaker, said on Friday it had completed the takeover of Ranbaxy
Laboratories, buying a 63.9 % stake for Rs 19980 crore ($4.20
billion). Daiichi Sankyo reached an agreement with the generic
drugmaker in June 2008 to buy a stake of at least 50.1% through a
tender offer, the private placement of new shares and the purchase
of outstanding shares from the founding family.
Plethico Pharmaceuticals was locked at the upper limit of 5% on BSE
on reports the company may pick up stake in a UAE based pharma
retail chain.
Alembic galloped 12.3%on BSE, on buyback plan.
Airline stocks rose on reports Indiaâ€(TM)s two largest private
airlines, Kingfisher Airlines and Jet Airways, are likely to cut
ticket prices by up to Rs 1,000 on domestic routes by December
2008. SpiceJet, Kingfisher Airlines and Jet Airways rose by between
1.26% to 2.89%. The two carriers Kingfisher Airlines and Jet
Airways are under pressure to act, as the aviation ministry wants
them to pass on the benefits of a series of measures announced by
the government to bail out the beleaguered industry.
Last week, oil marketing companies had announced a 17% cut in
aviation turbine fuel (ATF) prices, while the government reduced
customs duty on jet fuel by 5%.
Shares of fertiliser makers extended gains after the fertiliser
minister said on Thursday, 6 November 2008, he expected gas supply
to fertiliser units to more than triple by 2011/12 from current
levels. Rashtriya Chemicals , Tata Chemicals, Chambal Fertilisers &
Chemicals, GNFC, Nagarjuna Fertilizers & Chemicals and National
Fertilizers were up by 2% to 5%.
United Phosphorus surged 3.62% after an interse transfer of shares
took place between the promoter group at 10.3% premium to the
ruling price.
Roman Tarmat rose 10%, on bagging runways upgradation order.
Suzlon Energy clocked the highest volume of 2.72 crore shares on
BSE. GVK Power & Infrastructure (2.23 crore shares), Reliance
Natural Resources (1.1 crore shares), Housing Development &
Infrastructure (87.16 lakh shares) and Tata Tele Maharashtra (79.52
lakh shares) were the other volume toppers in that order.
Reliance Industries clocked the highest turnover of Rs 292.84 crore
on BSE. Suzlon Energy (Rs 183.77 crore), State Bank of India (Rs
159.91 crore), Reliance Capital (Rs 151.72 crore) and ICICI Bank
(Rs 123.52 crore) were the other turnover toppers in that order.
global cues helped the domestic bourses snap losses in the
preceding two trading session. The BSE Sensex rose 230.07 points or
2.36%. The barometer index breached the psychological 10,000 level
many times in intraday trade though it ended below that level.
Metal stocks rose on recovery in metal prices on the London Metal
Exchange. PSU banks rose on cut in lending rates. IT stocks rose as
a weak rupee offset fall in American depository receipts overnight.
Data showing rise in infrastructure output offset concerns of
economic slowdown triggered by productions cuts announced by
commercial vehicle makers in the last two days and steel maker JSW
Steel today and reduction in gross domestic product (GDP) forecast
for 2009 by the International Monetary Fund. India's infrastructure
sector output grew 5.1% in September 2008 from a year earlier, well
above 2.3% annual growth in August 2008, government data released
earlier in the day showed.
The International Monetary Fund, or IMF, on Thursday, 6 November
2008, predicted lower growth in India and economic contractions in
the US, Japan and euro region next year, calling for further
interest rate cuts and fiscal stimulus. Its estimate for India's
growth in 2009 is now 6.3%, 0.6% lower than its earlier estimate of
6.9% made just a month ago. Its estimate for the country's growth
in 2008 is down 0.1% to 7.8%.
European shares edged higher as commodities stocks tracked stronger
crude and metals prices and banking shares gained following
interest rate cuts in the previous session. Key benchmark indices
in France, Germany and UK were up by between 0.31% to 1.9%. The
Bank of England slashed the key interest rate by a steep 1.5% on
Thursday, 6 November 2008 and on the same day the European Central
Bank cut the key rate by 50 basis points.
Bargain hunting following a 25 basis points rate cut by the central
bank in South Korea on Friday, 7 November 2008, and rate cut in
Europe triggered a recovery in Asian stocks from an intra-day fall.
South Korea's Kospi was up almost 4% boosted by the rate cut. Key
benchmark indices in China, Singapore, Hong Kong, Taiwan, rose by
between 1.034% to 3.29%. Japan's Nikkei average was down 3.55% with
bargain hunting helping the benchmark pared losses that had taken
it down over 6% earlier in the day. The rate cut in Europe were
announced after Asian markets had closed on Thursday, 6 November
2008.
Trading in US index futures indicated the Dow will rise 100 points
at the opening bell.
The 30-share BSE Sensex was up 230.07 points or 2.36% at 9,964.29.
The index rose 331.15 points at the day's high of 10,065.37 in late
trade. The index fell 121 points at the day's low of 9,631.59 hit
in early trade.
The 50-unit S&P Nifty was up 80.35 points or 2.78% to 2,973.
The BSE clocked a turnover of Rs 3447 crore today as compared to a
turnover of Rs 4010.92 crore on 6 November 2008
The market recovered after a sharp slide in the past two trading
sessions. From the recent high of 10631.12 on 4 November 2008 the
Sensex had lost 896.90 points or 8.43% to 9734.22 on 6 November
2008. There has been a massive erosion in investors' wealth this
year. The Sensex is down 10,322.70 points or 50.88% in the calendar
year 2008 so far from its close of 20,286.99 on 31 December 2007.
It is 11,242.48 points or 53.01% below its all-time high of
21,206.77 struck on 10 January 2008.
Nifty November 2008 futures were at 2989.10, at a premium of 16.10
points as compared to spot closing of 2973. NSE's futures & options
(F&O) segment turnover was Rs 36,963.32 crore, which was lower than
Rs 43,836.07 crore on Thursday, 6 November 2008.
The BSE Mid-cap index was up 1.11% to 3,355.38, while the BSE
Small-cap index was up 0.51% to 3,900.10. Both the indices
underperformed the Sensex.
The BSE Power index (up 4.43% to 1,777.57), the BSE Oil & Gas index
(up 3.38% to 6,013.57), the BSE Metal index (up 3.18% to 5,152.33),
the BSE PSU index (up 3.01% to 4,965.80), the BSE Realty index (up
2.72% to 2,342.82) outperformed the Sensex.
The BSE Auto index (up 0.5% to 2,661.53), the BSE HealthCare index
(up 0.54% to 2,937.11), the BSE Consumer Durables index (up 1.29%
to 2,094.87), the BSE Capital Goods index (up 1.61% to 7,635.41),
the BSE Bankex (up 1.66% to 5,532.15), the BSE IT index (up 2.01%
to 2,670.54), the BSE Teck index (up 2.16% to 2,085.84) and BSE
FMCG index (up 2.22% to 1,968.70) underperformed the Sensex.
The market breadth turned positive later in the day from earlier
weak breadth. On BSE, 1124 stocks declined while 1417 gained. 75
stocks remained unchanged.
India's largest private sector firm by market capitalisation and
oil refiner Reliance Industries rose 3.95% to Rs 1,217.85 despite
reports it may delay commercial operations of its Jamnagar refinery
to early 2009 as it finishes the final testing of the facility.
Reliance Communications (up 5.53% to Rs 228.15), Jaiprakash
Associates (up 4.65% to Rs 87.70) and ITC (up 3.59% to Rs 174.80)
were the major gainers from the Sensex pack.
Power stocks gained. NTPC, Tata Power Company, Reliance
Infrastructure, Reliance Power, Power Grid Corporation of India
rose by between 2.61% to 10.92%.
Metal stocks gained tracking recovery in metal prices on the London
Metal Exchange. Tata Steel, Sterlite Industries, Steel Authority of
India, Hindustan Zinc, National Aluminum Company rose by between
2.07% to 10.68%.
Indiaâ€(TM)s largest aluminum maker by sales, Hindalco Industries
spurted 6.61% on reports the company has cleared the bridge loan
taken to acquire Canada's Novelis. But steel maker JSW Steel
plunged 5.18%, on production cut plan.
Shares of iron ore exporters rose on a television report that the
railway freight rates for iron ore has been cut by 50% from 8
November to 31 December 2008. Sesa Goa rose 3.10% and NMDC gained
2.4%.
The reductions would be applicable for iron ore traffic loaded in
South Eastern, East Coast and South Western Railways and for
distances above 350 kilometer to 400 kilometer
Auto pivotals fell after commercial vehicle makers announced
production cut amid falling demand for vehicles. Ashok Leyland,
India's second-biggest commercial vehicle maker by sales, fell
4.57% on a decision to cut production at its plants to three days a
week until the end of 2008 because of falling demand for its
vehicles.
But India's largest commercial vehicle maker by sales Tata Motors
recovered from the day's low. The stock was down 0.16% to Rs
158.90, off the day's low of Rs 148. Its ADR lost 3.81% overnight
after the company on 6 November 2008 had announced closing of the
commercial vehicle plant at Jamshedpur owing to a demand slump.
The country's largest passenger car maker by sales Maruti Suzuki
fell 0.38%. The company on 1 November 2008 said its sales in
October 2008 dipped 7% at 64,490 units, against 69,415 units in the
same month last year.
Shares of the two-wheeler makers were mixed. Indiaâ€(TM)s largest
motorbike maker by sales Hero Honda Motor rose 4.15%, and TVS Motor
Company fell 1.98%. Indiaâ€(TM)s largest scooter maker by sales Bajaj
Auto was up 0.94%. Last month, reports quoted a senior executive in
Bajaj Auto, India's second biggest motorcycle maker by sales, as
saying that it could cut production in November 2008 after the
festive season.
Meanwhile, the Petroleum Secretary, R S Pandey on Thursday (6
November 2008) said the government was not considering any fuel
price cut at the moment as public sector oil marketing companies
are still incurring revenue loss on sale of various petroleum
products.
Most of the IT stocks spurted after dismal start as a weak rupee
offset slide in weak American depository receipts overnight caused
by worries the US outsourcing business will be curtailed and the
direct impact will be on IT sector after Barack Obama won the US
presidential election early this week. India's third largest IT
exporter by sales Satyam Computer Services rose 3.16% to Rs 277.75,
off the dayâ€(TM)s low of Rs 263. Its American depository receipt
(ADR) fell 7.19% overnight.
India's second largest IT exporter by sales Infosys rose 1.15% to
Rs 1262.50, off the dayâ€(TM)s low of Rs 1205.25 even as ADR fell
10.47%. India's fourth largest IT exporter by sales Wipro rose 2.9%
to Rs 260.45 even as ADR slipped 8.56%. The stock had slipped 6.31%
in previous trading session. India's largest IT exporter by sales
Tata Consultancy Services rose 4.87% to Rs 524.55 off dayâ€(TM)s low
of Rs 485.10. The stock had slipped 1.08% in previous trading
session.
Obama has strong reservations on outsourcing from the US. He had
made many statements during his election speeches that he would
discourage outsourcing from the US when he comes into power.
Meanwhile, the Indian rupee weakened on Friday as expectations of
further foreign investor outflows from the stock market weighed on
sentiment. The partially convertible rupee was at 47.77/78 per
dollar, 0.1 % weaker than 47.66/69 at close on Thursday.
PSU banks rose after top state-owned banks on Thursday, 6 November
2008, cut their prime lending rates (PLR). Bank of Baroda,
Allahabad Bank, Central Bank of India, Oriental Bank of Commerce
and Corporation Bank rose by between 2.09% to 6.21%. All of them
reduced lending rates by 75 bps to 13.25% with effect from 10
November 2008.
India's largest commercial bank State Bank of India (SBI) rose
2.79% on a decision to cut the PLR by 75 basis points (bps) with
effect from 10 November 2008 and deposit rates by 25 to 50 bps
across all maturities effective 1 December 2008.
India's largest private sector bank by net profit ICICI Bank fell
0.67% as American depository receipt (ADR) lost 2.68% overnight.
ICICI Bank's chief executive K.V. Kamath said on 3 November 2008,
the bank will review interest rates in the next few days.
India's second largest private sector bank by net profit HDFC Bank
rose 2.64% to Rs 1,088.55 off dayâ€(TM)s low of Rs 1,032 even as ADR
slumped 4.81% on Thursday.
India's largest home loan lender by operating income HDFC jumped
2.64%. HDFC is yet to revise its rates, since the firm's borrowing
costs have not come down.
The Reserve Bank of India (RBI) on Saturday, 1 November 2008,
unexpectedly cut its main short-term lending rate viz. the repo
rate to ease a growing cash squeeze, spur faltering economic growth
and fend off damage from the global financial crisis.
Meanwhile, inflation based on the wholesale price index rose 10.72%
in the year through 25 October 2008, higher than previous weekâ€(TM)s
10.68% rise.
PSU OMCs rose after the Petroleum Secretary, R.S. Pandey, said, the
government is not considering any fuel price cut at the moment as
public sector oil marketing companies are still incurring revenue
loss on sale of various petroleum products. BPCL, HPCL and Indian
Oil Corporation fell by between 6.85% to 8.94%. Meanwhile, crude
oil rose from a 19-month low in New York as rising stock indexes
allayed concern about waning demand and a weaker dollar bolstered
the appeal of commodities. Oil for December delivery climbed as
much as 2.9%, to $62.50 a barrel on the New York Mercantile
Exchange.
Indiaâ€(TM)s largest state-run oil explorer by market capitalization
ONGC fell 0.29% despite reports Russia has allowed the company to
purchase London-listed Imperial Energy.
India's largest drug maker by sales Ranbaxy Laboratories rose 0.95%
recovering from earlier fall as Daiichi Sankyo Co, Japan's No. 3
drugmaker, said on Friday it had completed the takeover of Ranbaxy
Laboratories, buying a 63.9 % stake for Rs 19980 crore ($4.20
billion). Daiichi Sankyo reached an agreement with the generic
drugmaker in June 2008 to buy a stake of at least 50.1% through a
tender offer, the private placement of new shares and the purchase
of outstanding shares from the founding family.
Plethico Pharmaceuticals was locked at the upper limit of 5% on BSE
on reports the company may pick up stake in a UAE based pharma
retail chain.
Alembic galloped 12.3%on BSE, on buyback plan.
Airline stocks rose on reports Indiaâ€(TM)s two largest private
airlines, Kingfisher Airlines and Jet Airways, are likely to cut
ticket prices by up to Rs 1,000 on domestic routes by December
2008. SpiceJet, Kingfisher Airlines and Jet Airways rose by between
1.26% to 2.89%. The two carriers Kingfisher Airlines and Jet
Airways are under pressure to act, as the aviation ministry wants
them to pass on the benefits of a series of measures announced by
the government to bail out the beleaguered industry.
Last week, oil marketing companies had announced a 17% cut in
aviation turbine fuel (ATF) prices, while the government reduced
customs duty on jet fuel by 5%.
Shares of fertiliser makers extended gains after the fertiliser
minister said on Thursday, 6 November 2008, he expected gas supply
to fertiliser units to more than triple by 2011/12 from current
levels. Rashtriya Chemicals , Tata Chemicals, Chambal Fertilisers &
Chemicals, GNFC, Nagarjuna Fertilizers & Chemicals and National
Fertilizers were up by 2% to 5%.
United Phosphorus surged 3.62% after an interse transfer of shares
took place between the promoter group at 10.3% premium to the
ruling price.
Roman Tarmat rose 10%, on bagging runways upgradation order.
Suzlon Energy clocked the highest volume of 2.72 crore shares on
BSE. GVK Power & Infrastructure (2.23 crore shares), Reliance
Natural Resources (1.1 crore shares), Housing Development &
Infrastructure (87.16 lakh shares) and Tata Tele Maharashtra (79.52
lakh shares) were the other volume toppers in that order.
Reliance Industries clocked the highest turnover of Rs 292.84 crore
on BSE. Suzlon Energy (Rs 183.77 crore), State Bank of India (Rs
159.91 crore), Reliance Capital (Rs 151.72 crore) and ICICI Bank
(Rs 123.52 crore) were the other turnover toppers in that order.
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