Wednesday, December 28, 2011
Tuesday, December 27, 2011
Thursday, December 22, 2011
Monday, December 19, 2011
Saturday, December 17, 2011
THE LAST WEEK
Market slips to 2-year lows
Key benchmark indices tumbled to hit their lowest level in more than two years after the Reserve Bank of India (RBI) spoiled sentiments by keeping cash reserve ratio (CRR) unchanged, despite tight liquidity in the system, in its much awaited mid-quarter monetary policy review on Friday (16 December 2011). Data showing higher-than-expected inflation reading for November 2011 and a decline in industrial production in October 2011 also dampened sentiment.
Data showing selling by foreign funds recently also spooked investors. Foreign institutional investors (FIIs) sold shares worth Rs 323.28 crore on Thursday, 15 December 2011, as per the provisional data from the stock exchanges. FII outflow totaled Rs 1701.09 crore in five trading sessions from 9 to 15 December 2011, as per provisional data from the stock exchanges. The recent outflow followed sustained inflow early this month.
FIIs inflow in December 2011 totaled Rs 860.40 crore (till 15 December 2011). FIIs had sold shares worth a net Rs 4197.90 crore in November 2011. FII outflow in calendar 2011 totaled Rs 1951.70 crore (till 15 December 2011).
The BSE Sensex fell 722.11 points or 4.45% to 15,491.35 in the week ended Friday, 16 December 2011. The 50-share S&P CNX Nifty fell 215.10 points or 4.42% to 4,651.60.
The BSE Mid-Cap index fell 6.11% while the BSE Small-Cap index fell 6.03%. Both these indices underperformed the Sensex.
The RBI on Friday (16 December 2011) left its main lending rate unchanged in order to support faltering economic growth as inflation shows signs of cooling. The central bank also refrained from cutting the cash reserve ratio (CRR) despite tight liquidity in the system. The repo rate has been left steady at 8.5% after increasing it 13 times since March 2010. The bank rate also remains static at 6%. The central bank kept its end-March 2012 inflation forecast unchanged at 7%.
While inflation remains on its projected trajectory, downside risks to growth have clearly increased, RBI said in a statement. The guidance given in the second quarter review of the monetary policy was that, based on the projected inflation trajectory, further rate hikes might not be warranted. In view of the moderating growth momentum and higher downside risks to growth, this guidance is being reiterated, RBI said. From this point on, monetary policy actions are likely to reverse the cycle, responding to the risks to growth, RBI said.
However, it must be emphasized that inflation risks remain high and inflation could quickly recur as a result of both supply and demand forces, the central bank said in statement. Also, the rupee remains under stress, RBI said. The timing and magnitude of further actions will depend on a continuing assessment of how these factors shape up in the months ahead, RBI said. The RBI has raised rates 13 times since March 2010.
RBI said there are currently no significant signs of stress in the money market. However, in view of the fact that borrowings from the LAF are persistently above the RBI's comfort zone, further open market operations (OMOs) will be conducted as and when seen to be appropriate, RBI said.
The annual inflation declined in November 2011 from the previous month but remained above the 9% mark, data released by the government showed on 14 December 2011. Inflation, as measured by the wholesale price index (WPI), was at 9.11% in November as against 9.73% in October. Inflation figure for September 2011 was revised upwards to 10% from initial estimate of 9.72%.
Industrial production shrank 5.1% in October versus 11.3% growth in the same period a year earlier, data released by the Commerce Ministry showed on 12 December 2011. It was the first decline in industrial production in more than two years. Industrial output last fell in June 2009, when it shrank 1.8%. Manufacturing output, which has a 75.5% weight in the index of industrial production, fell 6% from a year earlier in October, compared with a 2.4% rise the previous month. Mining output shrank 7.2%, after falling 5.6% in September. September's industrial production growth was revised upwards marginally to 2%, from 1.9% earlier.
Coming back to equity market, trading for the week began on weak note. Key benchmark indices declined for the third straight day to settle at their lowest level in more than 2 weeks on Monday, 12 December 2011, as data showing decline in industrial production in October 2011 for the first time in more than two years and weak European stocks dampened sentiment. The BSE Sensex lost 343.11 points or 2.12% to settle at 15,870.35. The S&P CNX Nifty lost 102.10 points or 2.1% to settle at 4,764.60.
Key benchmark indices snapped a three-day losing streak on Tuesday, 13 December 2011, on speculation the RBI will start cutting interest rates next year to support flagging economic growth. The market was volatile. The BSE Sensex jumped 132.16 points or 0.83% to settle at 16,002.51. The S&P CNX Nifty advanced 36 points or 0.76% to settle at 4800.60.
Key benchmark indices dropped in choppy trade on Wednesday, 14 December 2011, as higher-than-expected inflation reading for November 2011 dashed hopes that the RBI will advance a rate cut to early next year to stimulate the economy. Data showing selling by foreign funds recently and weak European shares also dampened sentiment. The BSE Sensex lost 121.37 points or 0.76% to settle at 15,881.14. The S&P CNX Nifty shed 37.35 points or 0.78% to settle at 4,763.25.
Key benchmark indices fell for the second straight session on Thursday, 15 December 2011, to settle at their lowest level in nearly three weeks as data showing selling by foreign funds recently weighed on sentiment. The BSE Sensex lost 44.67 points or 0.28% to settle at 15,836.47. The S&P CNX Nifty was down 16.80 points or 0.35% to 4,746.35.
Key benchmark indices tumbled to hit their lowest level in more than two years on Friday, 16 December 2011, after the RBI kept CRR and short-term lending rate steady after mid-quarter monetary policy review that day. The BSE Sensex fell 345.12 points or 2.18% to settle at 15,491.35. The S&P CNX Nifty fell 94.75 points or 2% to 4,651.60.
From the 30-share Sensex pack, 26 declined and the remaining rose.
Engineering and construction major L&T slumped 12.32% to Rs 1075.80. It was the major Sensex loser last week. State-run power equipment maker Bhel tumbled 8.95% to Rs 240.45.
Shares in capital goods sector slumped after the recent data showed that capital goods production shrank 25.5% in October 2011 from a year earlier, compared with a 6.5% decline in September 2011. Capital goods production had jumped 21.04% in October 2010 from a year earlier.
Interest rate sensitive banking stocks fell after the RBI kept CRR and short-term lending rate steady after mid-quarter monetary policy review on Friday. India's second largest private sector bank by net profit HDFC Bank declined 6.49% to Rs 415.95. The bank's advance tax reportedly rose 20% to Rs 900 crore in Q3 December 2011 over Q3 December 2010.
India's largest private sector bank by net profit ICICI Bank fell 7.59% to Rs 676.05. The stock hit a 52-week low of Rs 667 on Friday. The bank's advance tax reportedly remained flat at Rs 450 crore in Q3 December 2011.
India's largest bank by net profit and branch network State Bank of India (SBI) declined 9.84% to Rs 1680.45. The bank's advance tax reportedly fell 6.48% to Rs 1730 crore in Q3 December 2011 over Q3 December 2010.
Sterlite Industries (down 11.83%), DLF (down 8.97%), Tata Steel (down 8.36%), Tata Power Company (down 7.35%), Jaiprakash Associates (down 6.79%), Mahindra & Mahindra (down 6.32%) and Bharti Airtel (down 6.24%), edged lower from the Sensex pack.
Index heavyweight Reliance Industries (RIL) fell 4.30% to Rs 723. The company's advance tax payment reportedly fell 15.79% to Rs 1002 crore in Q3 December 2011 over Q3 December 2010. Oil minister Jaipal Reddy said in a written reply in the lower house of parliament on Thursday, 15 December 2011, that the decline in gas output from RIL's east coast block is due to the company drilling fewer number of wells than promised and stoppage of production at six wells.
RIL late last month said that it has initiated arbitration proceedings against the government to seek an independent view of a tribunal on the issue of the company's entitlement of recovery of entire costs on KG-D6 gas blocks from the revenue generated from the blocks. RIL said it has initiated arbitration proceedings against the Government of India (GoI) in a bid to finally resolve the cost recovery issue so as not to hinder future investments in this block.
RIL said its investment in KG-D6 production facilities has been only partly recovered and the return on the investment so far is less than the cost of the capital. The production sharing contract (PSC) with the Government of India (GoI) contains no provision which entitles the GoI to restrict the costs recovered by the company by reference to factors such as the level of production or the extent to which field facilities are utilised, RIL said.
Sun Pharmaceuticals Industries (up 0.19%), Infosys (up 0.41%), Hindustan Unilever (up 1.70%) and Cipla (up 1.81%), edged higher from the Sensex pack.
Market closes at 25 month low
Key benchmark indices tumbled to hit their lowest level in more than two years led by a decline in capital goods
stocks. The market fell for the third consecutive trading session.
Index heavyweight Reliance Industries (RIL) dropped more than 3%. The
barometer index, BSE Sensex, fell below the psychological 16,000 level,
having alternately moved above and below that mark in intraday trade. Interest
rate sensitive banking, auto and realty stocks declined after Reserve
Bank of India (RBI) kept cash reserve ratio (CRR) and short-term lending
rate steady after mid-quarter monetary policy review today.
The BSE Sensex was down 345.12 points or 2.18%, off close to 580 points from the day's high and up about 65 points from the day's low. The market breadth was weak. Capital goods stocks extended recent losses on worries new order flows will be hit adversely in a slowing economy, with L&T and Bhel hitting 52 week lows. IT stocks fell as rupee strengthened against the dollar after the Reserve Bank of India took steps to check the recent sharp slide in the local currency. ICICI Bank, Sterlite Industries and Tata Steel hit 52-week lows.
The Sensex has fallen 632.11 points or 3.92% so far this month. The Sensex has slumped 5,017.14 points or 24.46% in calendar 2011. From a 52-week high of 20,664.80 on 3 January 2011, the Sensex has lost 5,173.45 points or 25.03%.
Coming back to today's trade, the market opened on a firm note as Asian stocks rose. The Sensex trimmed gains after hitting fresh intraday high in morning trade. The barometer index, BSE Sensex, alternately moved above and below the psychological 16,000 level in mid-morning trade. A bout of volatility was witnessed in early afternoon trade as key benchmark indices regained strength after paring gains from intraday highs after the Reserve Bank of India (RBI) left its key lending rate unchanged. The RBI announced the decision at about 12:00 IST. The market regained strength in afternoon trade. Volatility was at the forefront as key benchmark indices gave almost all the intraday gains to hit fresh intraday low in mid-afternoon trade after hitting fresh intraday high in afternoon trade. The market slumped in late trade.
Data showing selling by foreign funds recently weighed on sentiment. Foreign institutional investors (FIIs) sold shares worth Rs 323.28 crore on Thursday, 15 December 2011, as per the provisional data from the stock exchanges. FII outflow totaled Rs 1701.09 crore in five trading sessions from 9 to 15 December 2011, as per provisional data from the stock exchanges. The recent outflow followed sustained inflow early this month.
The RBI on Friday left its main lending rate unchanged in order to support faltering economic growth as inflation shows signs of cooling. The central bank also refrained from cutting the cash reserve ratio (CRR) despite tight liquidity in the system. The repo rate has been left steady at 8.5% after increasing it 13 times since March 2010. The bank rate also remains static at 6%. The central bank kept its end-March 2012 inflation forecast unchanged at 7%.
While inflation remains on its projected trajectory, downside risks to growth have clearly increased, RBI said in a statement. The guidance given in the second quarter review of the monetary policy was that, based on the projected inflation trajectory, further rate hikes might not be warranted. In view of the moderating growth momentum and higher downside risks to growth, this guidance is being reiterated, RBI said. From this point on, monetary policy actions are likely to reverse the cycle, responding to the risks to growth, RBI said.
However, it must be emphasized that inflation risks remain high and inflation could quickly recur as a result of both supply and demand forces, the central bank said in statement. Also, the rupee remains under stress, RBI said. The timing and magnitude of further actions will depend on a continuing assessment of how these factors shape up in the months ahead, RBI said. The RBI has raised rates 13 times since March 2010.
RBI said there are currently no significant signs of stress in the money market. However, in view of the fact that borrowings from the LAF are persistently above the Reserve Bank of India's comfort zone, further open market operations (OMOs) will be conducted as and when seen to be appropriate, RBI said.
The BSE Sensex was down 345.12 points or 2.18% to 15,491.35, its lowest closing level since 3 November 2009. The index jumped 232.43 points at the day's high of 16,068.90 in mid-afternoon trade, its highest level since 14 December 2011. The index slumped 411.27 points at the day's low of 15,425.20 in late trade.
The S&P CNX Nifty was down 94.75 points or 2% to 4,651.60, its lowest closing level since 3 November 2009. The index hit a hit a high of 4,818.85 in intraday trade, its highest level since 14 December 2011. The Nifty hit a low of 4,628.20 in intraday trade.
The BSE Mid-Cap index fell 1.72% and the BSE Small-Cap index shed 1.6%. Both these indices outperformed the Sensex.
BSE clocked turnover of Rs 2177 crore, higher than Rs 2041.89 crore on Thursday, 15 December 2011.
The market breadth, indicating the overall health of the market, was weak. On BSE, 1,932 shares fell and 826 shares rose. A total of 120 shares were unchanged. The breadth was strong earlier in the day.
From the 30-member Sensex pack, 28 stocks fell and only two of them rose.
Index heavyweight Reliance Industries (RIL) fell 3.48% to Rs 723. The stock was volatile. The stock hit a high of Rs 761.25 and a low of Rs 719. The company's advance tax payment reportedly fell 15.79% to Rs 1002 crore in Q3 December 2011 over Q3 December 2010. Oil minister Jaipal Reddy said in a written reply in the lower house of parliament on Thursday, 15 December 2011, that the decline in gas output from RIL's east coast block is due to the company drilling fewer number of wells than promised and stoppage of production at six wells.
RIL late last month said that it has initiated arbitration proceedings against the government to seek an independent view of a tribunal on the issue of the company's entitlement of recovery of entire costs on KG-D6 gas blocks from the revenue generated from the blocks. RIL said it has initiated arbitration proceedings against the Government of India (GoI) in a bid to finally resolve the cost recovery issue so as not to hinder future investments in this block.
RIL said its investment in KG-D6 production facilities has been only partly recovered and the return on the investment so far is less than the cost of the capital. The production sharing contract (PSC) with the Government of India (GoI) contains no provision which entitles the GoI to restrict the costs recovered by the company by reference to factors such as the level of production or the extent to which field facilities are utilised, RIL said.
Interest rate sensitive realty stocks declined after Reserve Bank of India (RBI) kept short term lending rates steady. Purchases of both residential and commercial property are largely driven by finance. DLF, HDIL, Unitech, and Indiabulls Real Estate fell by between 1.92% to 7.78%.
Capital goods stocks tumbled on worries new order flows will be hit adversely in a slowing economy. Engineering and construction major, L&T slumped 5.33% to Rs 1075.80. The stock hit a 52-week low of Rs 1063 today. The stock was the top loser from the Sensex pack.
Bhel fell 3.88% to Rs 240.45. The stock hit a 52-week low of Rs 238 today. The stock was the second biggest loser from the Sensex pack.
Among other capital goods stocks, BGR Energy Systems, Bharat Electronics, Suzlon Energy, Praj Industries, Havells India, ABB, and Punj Lloyd shed by between 1.18% to 10.06%.
Sterlite Industries fell 4.28% to Rs 89.40. The stock hit a 52-week low of Rs 88.40 today.
Tata Steel shed 2.72% to Rs 364.95. The stock hit a 52-week low of Rs 362.30 today.
Among other metal stocks, Jindal Saw, Sail, Bhushan Steel, JSW Steel, Hindalco Industries, and Jindal Steel & Power fell by between 0.16% to 5.14%.
IT stocks fell as rupee strengthened against the dollar after the Reserve Bank of India took steps to check the recent sharp slide in the local currency. India's third largest software services exporter by revenue Wipro fell 0.63%. India's second largest software services exporter by revenue Infosys was flat. India's largest software services exporter TCS declined 3.31%. TCS today, 16 December 2011, said it has evacuated nearly 1,600 staff from one of its training facilities in Chennai after a bomb scare at the center. The incident won't have any impact on business operations in Chennai, as the employees were mostly trainees, TCS said in a statement. Police and specialist teams have taken control of the facility and are investigating the incident, the company said.
A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports. The rupee was at 52.73/75 per dollar, stronger than its previous close of 53.64/65 on Thursday. The rupee had touched a record low of 54.30 in intraday deals on Thursday.
Interest rate sensitive banking stocks fell after Reserve Bank of India (RBI) kept cash reserve ratio (CRR) and short-term lending rate steady after mid-quarter monetary policy review today. India's second largest private sector bank by net profit, HDFC Bank, declined 3.57%. The bank's advance tax reportedly rose 20% to Rs 900 crore in Q3 December 2011 over Q3 December 2010.
India's largest private sector bank by net profit, ICICI Bank fell 3.18% to Rs 676.05. The stock hit a 52-week low of Rs 667 today. The bank's advance tax reportedly remained flat at Rs 450 crore in Q3 December 2011.
India's largest bank by net profit and branch network State Bank of India (SBI) declined 3.67%. The bank's advance tax reportedly fell 6.48% to Rs 1730 crore in Q3 December 2011 over Q3 December 2010.
The RBI said that year-on-year non-food credit growth at 17.5% on 2 December 2011 was below its indicative projection of 18%.
Interest rate sensitive auto stocks reversed intraday gains as the Reserve Bank of India (RBI) kept short term lending rate steady. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
India's largest passenger vehicle maker by sales Tata Motors fell 0.29%. The company's advance tax reportedly fell 93.27% to Rs 80 crore in Q3 December 2011 over Q3 December 2010. The company's global vehicle sales rose an annual 35% to 1,08,028 units in November 2011 over November 2010, the company said in a statement on Thursday, with its luxury Jaguar Land Rover unit reporting a 27% rise in sales to 29,183 units. Sales of Jaguar cars fell 5% to 5,315 units while those of Land Rover sport-utility vehicles gained 38% to 23,868 units. The company said it sold 49,724 trucks and buses globally in November, up 24% from a year earlier.
India's largest tractor maker by sales Mahindra & Mahindra (M&M) declined 0.94%. The company's advance tax reportedly fell 4.34% to Rs 220 crore in Q3 December 2011 over Q3 December 2010. The company on Thursday, 15 December 2011, said it will raise prices of its vehicles by up to 3% in January 2012 to offset the effects of rising raw-material costs. The company's total auto sales jumped 52.7% to 40,722 units in November 2011 over November 2010.
India's largest car maker by sales Maruti Suzuki India fell 0.24%. The company's total sales fell 18.5% to 91,772 units in November 2011 over November 2010.
Ashok Leyland shed 3.14%. The company reported 53.36% jump in commercial vehicle sales at 7,878 units in November 2011 over November 2010.
India's largest motorcycle maker by sales Hero MotoCorp fell 1.76%. The company's advance tax reportedly rose 50% to Rs 180 crore in Q3 December 2011 over Q3 December 2010. The company's sales rose 27.4% to 536,772 units in November 2011 over November 2010.
India's second largest motorcycle maker by sales Bajaj Auto dropped 0.12%. The company's advance tax reportedly rose 21.62% to Rs 450 crore in Q3 December 2011 over Q3 December 2010. Bajaj Auto's total vehicle sales jumped 25% at 374,477 units in November 2011 over November 2010.
Car sales in India rose in November, the first monthly rise in five, an industry body said on Thursday, 8 December 2011, as the industry rebounded strongly from the biggest fall in over a decade the month before. Domestic passenger car sales increased by 7% to 1,71,131 units in November 2011, from 1,59,939 units in the same month last year. According to figures released by the Society of Indian Automobile Manufacturers (SIAM) on Thursday, motorcycle sales in the country grew by 22.67% to 8,69,070 units during the month from 7,08,476 units in the corresponding month last year. Total two-wheeler sales grew by 25.27% to 11,63,294 units last month from 9,28,660 units in November 2010, as per the data. Sales of commercial vehicles grew by 34.99% to 66,264 units in the month under review from 49,087 units in the year-ago period, SIAM said.
Coal India fell 3.2% after interim chairman of the state-run company Nirmal Chandra Jha on Thursday said the steep recent slide of the rupee against the dollar will lower the company's net profit for the year ending March 2013 (FY 2013) as the company spends about Rs 3000 crore annually to import mining equipment.
Aviation stocks reversed initial gains in a weak market. Public sector oil marketing companies cut jet fuel rates by 1.3% on Thursday, 15 December 2011, in step with softening in commodity's international rates. SpiceJet (down 0.58%), Jet Airways (India) (down 6.04%) and Kingfisher Airlines (down 4.6 %) edged lower. Jet fuel or aviation turbine fuel (ATF) typically makes up almost half of an airline's operating cost and the latest cut in prices will slightly ease burden on the cash-strapped airlines.
The price of ATF in Delhi was cut by Rs 833 per kilolitre (kl) or 1.3% to Rs 63,739 per kl with effect from midnight Thursday (15 December 2011). The three public sector oil marketing companies (PSU OMCs) -- BPCL, HPCL and Indian Oil Corporation -- revise jet fuel prices on the 1st and 16th of every month, based on the average international price in the preceding fortnight.
Cals Refineries clocked highest volume of 1.43 crore shares on BSE. Birla Cotsyn (88.61 lakh shares), Kwality Dairy (68.92 lakh shares), Birla Power Solutions (48.04 lakh shares) and Suzlon Energy (47.67 lakh shares) were the other volume toppers in that order.
SBI clocked highest turnover of Rs 240.33 crore on BSE. L&T (Rs 82.49 crore), RIL (Rs 81.86 crore), ICICI Bank (Rs 75.28 crore) and Axis Bank (Rs 69.04 crore) were the other turnover toppers in that order.
As per reports, advance taxes for the third quarter from corporates headquartered in Mumbai have risen 10%. Cements and pharma companies have reported surge in advance tax payment for the third quarter. Advance taxes are collected in four installments -- 15% by 15 June; 40% by 15 September; 75% by 15 December and 100% by 15 March.
Credit rating agency Moody's Investors Service on Wednesday, 14 December 2011, said that the sharp decline in the value of the Indian rupee against the dollar is generally exerting only a moderate impact on rated Indian companies. Risks for companies holding large amounts of dollar denominated debt are also manageable in the near term, given that debt maturities are limited for this time frame, Moody's said in a new report. This means Indian companies rated by Moody's do not have a significant dollar outflow at a time when the Indian rupee is losing ground. Moody's latest assessment comes as the rupee continued its free fall against the dollar on Thursday, 15 December 2011, sinking to a new record low for the fourth straight day, as investors fled risk-sensitive currencies due to escalating concerns over Europe's sovereign debt crisis.
The Reserve Bank of India (RBI) took steps on Thursday to arrest the free-fall of the rupee after the local currency hit a new record low against the dollar for the fourth consecutive day. The new currency rules include reducing the net amount of US dollar-versus-rupee trade that authorized foreign-exchange dealers can hold on their books. Another measure of the bank's new rules would limit the amount of currency hedging by importers, who typically buy dollars.
A government statement in parliament last month dashed hopes of a relief in securities transaction tax (STT). Junior finance minister S.S. Palanimanickam has said that the government has no proposal to lower the securities transaction tax (STT). There has been a speculation that the government will reduce STT in Union Budget 2012-2013 in a bid to revive sagging volumes on the bourses. Palanimanickam said in a written reply to Rajya Sabha that the securities transaction tax receipts had declined by around 18% to Rs 2960 crore during the first six months in the current fiscal year from a year ago period.
The government last week said that the Rs 40000-crore stakes sale target in state-run companies would be hard to achieve this fiscal year, while tax receipts would suffer from the impact of the global slowdown.
European stock edged higher on Friday after positive data in US on Thursday. Key benchmark indices in Germany, UK and France rose by between 0.02% to 0.9%.
Asian shares edged higher on Friday, 16 December 2011, as signs of strength in the US economy temporarily broke through gloom over the European debt crisis that had driven a sell-off in riskier assets over the past three days. Key benchmark indices in China, Hong Kong, Indonesia, Japan, Taiwan, Singapore and South Korea rose by between 0.29% to 2.02%.
Trading in US index futures indicated that the Dow could gain 66 points at the opening bell on Friday, 16 December 2011. US stocks rose modestly on Thursday, after a fall in US unemployment, a stronger-than-expected rise in regional factory activity and better-than-forecast results from FedEx Corp painted an improving picture of the economy. Jobless claims in the US dropped to a three and a half year low last week.
Fitch Ratings, the third-biggest of the major credit rating agencies, has downgraded seven global banks based in Europe and the United States, citing "increased challenges" in the financial markets. Bank of America Corp., Goldman Sachs and Citigroup had their credit grades cut by Fitch. Barclays, Credit Suisse, Deutsche Bank and BNP Paribas also had their ratings lowered by Fitch.
The BSE Sensex was down 345.12 points or 2.18%, off close to 580 points from the day's high and up about 65 points from the day's low. The market breadth was weak. Capital goods stocks extended recent losses on worries new order flows will be hit adversely in a slowing economy, with L&T and Bhel hitting 52 week lows. IT stocks fell as rupee strengthened against the dollar after the Reserve Bank of India took steps to check the recent sharp slide in the local currency. ICICI Bank, Sterlite Industries and Tata Steel hit 52-week lows.
The Sensex has fallen 632.11 points or 3.92% so far this month. The Sensex has slumped 5,017.14 points or 24.46% in calendar 2011. From a 52-week high of 20,664.80 on 3 January 2011, the Sensex has lost 5,173.45 points or 25.03%.
Coming back to today's trade, the market opened on a firm note as Asian stocks rose. The Sensex trimmed gains after hitting fresh intraday high in morning trade. The barometer index, BSE Sensex, alternately moved above and below the psychological 16,000 level in mid-morning trade. A bout of volatility was witnessed in early afternoon trade as key benchmark indices regained strength after paring gains from intraday highs after the Reserve Bank of India (RBI) left its key lending rate unchanged. The RBI announced the decision at about 12:00 IST. The market regained strength in afternoon trade. Volatility was at the forefront as key benchmark indices gave almost all the intraday gains to hit fresh intraday low in mid-afternoon trade after hitting fresh intraday high in afternoon trade. The market slumped in late trade.
Data showing selling by foreign funds recently weighed on sentiment. Foreign institutional investors (FIIs) sold shares worth Rs 323.28 crore on Thursday, 15 December 2011, as per the provisional data from the stock exchanges. FII outflow totaled Rs 1701.09 crore in five trading sessions from 9 to 15 December 2011, as per provisional data from the stock exchanges. The recent outflow followed sustained inflow early this month.
The RBI on Friday left its main lending rate unchanged in order to support faltering economic growth as inflation shows signs of cooling. The central bank also refrained from cutting the cash reserve ratio (CRR) despite tight liquidity in the system. The repo rate has been left steady at 8.5% after increasing it 13 times since March 2010. The bank rate also remains static at 6%. The central bank kept its end-March 2012 inflation forecast unchanged at 7%.
While inflation remains on its projected trajectory, downside risks to growth have clearly increased, RBI said in a statement. The guidance given in the second quarter review of the monetary policy was that, based on the projected inflation trajectory, further rate hikes might not be warranted. In view of the moderating growth momentum and higher downside risks to growth, this guidance is being reiterated, RBI said. From this point on, monetary policy actions are likely to reverse the cycle, responding to the risks to growth, RBI said.
However, it must be emphasized that inflation risks remain high and inflation could quickly recur as a result of both supply and demand forces, the central bank said in statement. Also, the rupee remains under stress, RBI said. The timing and magnitude of further actions will depend on a continuing assessment of how these factors shape up in the months ahead, RBI said. The RBI has raised rates 13 times since March 2010.
RBI said there are currently no significant signs of stress in the money market. However, in view of the fact that borrowings from the LAF are persistently above the Reserve Bank of India's comfort zone, further open market operations (OMOs) will be conducted as and when seen to be appropriate, RBI said.
The BSE Sensex was down 345.12 points or 2.18% to 15,491.35, its lowest closing level since 3 November 2009. The index jumped 232.43 points at the day's high of 16,068.90 in mid-afternoon trade, its highest level since 14 December 2011. The index slumped 411.27 points at the day's low of 15,425.20 in late trade.
The S&P CNX Nifty was down 94.75 points or 2% to 4,651.60, its lowest closing level since 3 November 2009. The index hit a hit a high of 4,818.85 in intraday trade, its highest level since 14 December 2011. The Nifty hit a low of 4,628.20 in intraday trade.
The BSE Mid-Cap index fell 1.72% and the BSE Small-Cap index shed 1.6%. Both these indices outperformed the Sensex.
BSE clocked turnover of Rs 2177 crore, higher than Rs 2041.89 crore on Thursday, 15 December 2011.
The market breadth, indicating the overall health of the market, was weak. On BSE, 1,932 shares fell and 826 shares rose. A total of 120 shares were unchanged. The breadth was strong earlier in the day.
From the 30-member Sensex pack, 28 stocks fell and only two of them rose.
Index heavyweight Reliance Industries (RIL) fell 3.48% to Rs 723. The stock was volatile. The stock hit a high of Rs 761.25 and a low of Rs 719. The company's advance tax payment reportedly fell 15.79% to Rs 1002 crore in Q3 December 2011 over Q3 December 2010. Oil minister Jaipal Reddy said in a written reply in the lower house of parliament on Thursday, 15 December 2011, that the decline in gas output from RIL's east coast block is due to the company drilling fewer number of wells than promised and stoppage of production at six wells.
RIL late last month said that it has initiated arbitration proceedings against the government to seek an independent view of a tribunal on the issue of the company's entitlement of recovery of entire costs on KG-D6 gas blocks from the revenue generated from the blocks. RIL said it has initiated arbitration proceedings against the Government of India (GoI) in a bid to finally resolve the cost recovery issue so as not to hinder future investments in this block.
RIL said its investment in KG-D6 production facilities has been only partly recovered and the return on the investment so far is less than the cost of the capital. The production sharing contract (PSC) with the Government of India (GoI) contains no provision which entitles the GoI to restrict the costs recovered by the company by reference to factors such as the level of production or the extent to which field facilities are utilised, RIL said.
Interest rate sensitive realty stocks declined after Reserve Bank of India (RBI) kept short term lending rates steady. Purchases of both residential and commercial property are largely driven by finance. DLF, HDIL, Unitech, and Indiabulls Real Estate fell by between 1.92% to 7.78%.
Capital goods stocks tumbled on worries new order flows will be hit adversely in a slowing economy. Engineering and construction major, L&T slumped 5.33% to Rs 1075.80. The stock hit a 52-week low of Rs 1063 today. The stock was the top loser from the Sensex pack.
Bhel fell 3.88% to Rs 240.45. The stock hit a 52-week low of Rs 238 today. The stock was the second biggest loser from the Sensex pack.
Among other capital goods stocks, BGR Energy Systems, Bharat Electronics, Suzlon Energy, Praj Industries, Havells India, ABB, and Punj Lloyd shed by between 1.18% to 10.06%.
Sterlite Industries fell 4.28% to Rs 89.40. The stock hit a 52-week low of Rs 88.40 today.
Tata Steel shed 2.72% to Rs 364.95. The stock hit a 52-week low of Rs 362.30 today.
Among other metal stocks, Jindal Saw, Sail, Bhushan Steel, JSW Steel, Hindalco Industries, and Jindal Steel & Power fell by between 0.16% to 5.14%.
IT stocks fell as rupee strengthened against the dollar after the Reserve Bank of India took steps to check the recent sharp slide in the local currency. India's third largest software services exporter by revenue Wipro fell 0.63%. India's second largest software services exporter by revenue Infosys was flat. India's largest software services exporter TCS declined 3.31%. TCS today, 16 December 2011, said it has evacuated nearly 1,600 staff from one of its training facilities in Chennai after a bomb scare at the center. The incident won't have any impact on business operations in Chennai, as the employees were mostly trainees, TCS said in a statement. Police and specialist teams have taken control of the facility and are investigating the incident, the company said.
A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports. The rupee was at 52.73/75 per dollar, stronger than its previous close of 53.64/65 on Thursday. The rupee had touched a record low of 54.30 in intraday deals on Thursday.
Interest rate sensitive banking stocks fell after Reserve Bank of India (RBI) kept cash reserve ratio (CRR) and short-term lending rate steady after mid-quarter monetary policy review today. India's second largest private sector bank by net profit, HDFC Bank, declined 3.57%. The bank's advance tax reportedly rose 20% to Rs 900 crore in Q3 December 2011 over Q3 December 2010.
India's largest private sector bank by net profit, ICICI Bank fell 3.18% to Rs 676.05. The stock hit a 52-week low of Rs 667 today. The bank's advance tax reportedly remained flat at Rs 450 crore in Q3 December 2011.
India's largest bank by net profit and branch network State Bank of India (SBI) declined 3.67%. The bank's advance tax reportedly fell 6.48% to Rs 1730 crore in Q3 December 2011 over Q3 December 2010.
The RBI said that year-on-year non-food credit growth at 17.5% on 2 December 2011 was below its indicative projection of 18%.
Interest rate sensitive auto stocks reversed intraday gains as the Reserve Bank of India (RBI) kept short term lending rate steady. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
India's largest passenger vehicle maker by sales Tata Motors fell 0.29%. The company's advance tax reportedly fell 93.27% to Rs 80 crore in Q3 December 2011 over Q3 December 2010. The company's global vehicle sales rose an annual 35% to 1,08,028 units in November 2011 over November 2010, the company said in a statement on Thursday, with its luxury Jaguar Land Rover unit reporting a 27% rise in sales to 29,183 units. Sales of Jaguar cars fell 5% to 5,315 units while those of Land Rover sport-utility vehicles gained 38% to 23,868 units. The company said it sold 49,724 trucks and buses globally in November, up 24% from a year earlier.
India's largest tractor maker by sales Mahindra & Mahindra (M&M) declined 0.94%. The company's advance tax reportedly fell 4.34% to Rs 220 crore in Q3 December 2011 over Q3 December 2010. The company on Thursday, 15 December 2011, said it will raise prices of its vehicles by up to 3% in January 2012 to offset the effects of rising raw-material costs. The company's total auto sales jumped 52.7% to 40,722 units in November 2011 over November 2010.
India's largest car maker by sales Maruti Suzuki India fell 0.24%. The company's total sales fell 18.5% to 91,772 units in November 2011 over November 2010.
Ashok Leyland shed 3.14%. The company reported 53.36% jump in commercial vehicle sales at 7,878 units in November 2011 over November 2010.
India's largest motorcycle maker by sales Hero MotoCorp fell 1.76%. The company's advance tax reportedly rose 50% to Rs 180 crore in Q3 December 2011 over Q3 December 2010. The company's sales rose 27.4% to 536,772 units in November 2011 over November 2010.
India's second largest motorcycle maker by sales Bajaj Auto dropped 0.12%. The company's advance tax reportedly rose 21.62% to Rs 450 crore in Q3 December 2011 over Q3 December 2010. Bajaj Auto's total vehicle sales jumped 25% at 374,477 units in November 2011 over November 2010.
Car sales in India rose in November, the first monthly rise in five, an industry body said on Thursday, 8 December 2011, as the industry rebounded strongly from the biggest fall in over a decade the month before. Domestic passenger car sales increased by 7% to 1,71,131 units in November 2011, from 1,59,939 units in the same month last year. According to figures released by the Society of Indian Automobile Manufacturers (SIAM) on Thursday, motorcycle sales in the country grew by 22.67% to 8,69,070 units during the month from 7,08,476 units in the corresponding month last year. Total two-wheeler sales grew by 25.27% to 11,63,294 units last month from 9,28,660 units in November 2010, as per the data. Sales of commercial vehicles grew by 34.99% to 66,264 units in the month under review from 49,087 units in the year-ago period, SIAM said.
Coal India fell 3.2% after interim chairman of the state-run company Nirmal Chandra Jha on Thursday said the steep recent slide of the rupee against the dollar will lower the company's net profit for the year ending March 2013 (FY 2013) as the company spends about Rs 3000 crore annually to import mining equipment.
Aviation stocks reversed initial gains in a weak market. Public sector oil marketing companies cut jet fuel rates by 1.3% on Thursday, 15 December 2011, in step with softening in commodity's international rates. SpiceJet (down 0.58%), Jet Airways (India) (down 6.04%) and Kingfisher Airlines (down 4.6 %) edged lower. Jet fuel or aviation turbine fuel (ATF) typically makes up almost half of an airline's operating cost and the latest cut in prices will slightly ease burden on the cash-strapped airlines.
The price of ATF in Delhi was cut by Rs 833 per kilolitre (kl) or 1.3% to Rs 63,739 per kl with effect from midnight Thursday (15 December 2011). The three public sector oil marketing companies (PSU OMCs) -- BPCL, HPCL and Indian Oil Corporation -- revise jet fuel prices on the 1st and 16th of every month, based on the average international price in the preceding fortnight.
Cals Refineries clocked highest volume of 1.43 crore shares on BSE. Birla Cotsyn (88.61 lakh shares), Kwality Dairy (68.92 lakh shares), Birla Power Solutions (48.04 lakh shares) and Suzlon Energy (47.67 lakh shares) were the other volume toppers in that order.
SBI clocked highest turnover of Rs 240.33 crore on BSE. L&T (Rs 82.49 crore), RIL (Rs 81.86 crore), ICICI Bank (Rs 75.28 crore) and Axis Bank (Rs 69.04 crore) were the other turnover toppers in that order.
As per reports, advance taxes for the third quarter from corporates headquartered in Mumbai have risen 10%. Cements and pharma companies have reported surge in advance tax payment for the third quarter. Advance taxes are collected in four installments -- 15% by 15 June; 40% by 15 September; 75% by 15 December and 100% by 15 March.
Credit rating agency Moody's Investors Service on Wednesday, 14 December 2011, said that the sharp decline in the value of the Indian rupee against the dollar is generally exerting only a moderate impact on rated Indian companies. Risks for companies holding large amounts of dollar denominated debt are also manageable in the near term, given that debt maturities are limited for this time frame, Moody's said in a new report. This means Indian companies rated by Moody's do not have a significant dollar outflow at a time when the Indian rupee is losing ground. Moody's latest assessment comes as the rupee continued its free fall against the dollar on Thursday, 15 December 2011, sinking to a new record low for the fourth straight day, as investors fled risk-sensitive currencies due to escalating concerns over Europe's sovereign debt crisis.
The Reserve Bank of India (RBI) took steps on Thursday to arrest the free-fall of the rupee after the local currency hit a new record low against the dollar for the fourth consecutive day. The new currency rules include reducing the net amount of US dollar-versus-rupee trade that authorized foreign-exchange dealers can hold on their books. Another measure of the bank's new rules would limit the amount of currency hedging by importers, who typically buy dollars.
A government statement in parliament last month dashed hopes of a relief in securities transaction tax (STT). Junior finance minister S.S. Palanimanickam has said that the government has no proposal to lower the securities transaction tax (STT). There has been a speculation that the government will reduce STT in Union Budget 2012-2013 in a bid to revive sagging volumes on the bourses. Palanimanickam said in a written reply to Rajya Sabha that the securities transaction tax receipts had declined by around 18% to Rs 2960 crore during the first six months in the current fiscal year from a year ago period.
The government last week said that the Rs 40000-crore stakes sale target in state-run companies would be hard to achieve this fiscal year, while tax receipts would suffer from the impact of the global slowdown.
European stock edged higher on Friday after positive data in US on Thursday. Key benchmark indices in Germany, UK and France rose by between 0.02% to 0.9%.
Asian shares edged higher on Friday, 16 December 2011, as signs of strength in the US economy temporarily broke through gloom over the European debt crisis that had driven a sell-off in riskier assets over the past three days. Key benchmark indices in China, Hong Kong, Indonesia, Japan, Taiwan, Singapore and South Korea rose by between 0.29% to 2.02%.
Trading in US index futures indicated that the Dow could gain 66 points at the opening bell on Friday, 16 December 2011. US stocks rose modestly on Thursday, after a fall in US unemployment, a stronger-than-expected rise in regional factory activity and better-than-forecast results from FedEx Corp painted an improving picture of the economy. Jobless claims in the US dropped to a three and a half year low last week.
Fitch Ratings, the third-biggest of the major credit rating agencies, has downgraded seven global banks based in Europe and the United States, citing "increased challenges" in the financial markets. Bank of America Corp., Goldman Sachs and Citigroup had their credit grades cut by Fitch. Barclays, Credit Suisse, Deutsche Bank and BNP Paribas also had their ratings lowered by Fitch.
QUICK REVIEW : Sensex, Nifty tumble to 2-year lows; breadth weak
Key benchmark indices tumbled to hit their lowest level in more than two years led by a decline in capital goods
stocks. Index heavyweight Reliance Industries (RIL) dropped nearly 4%.
The barometer index, BSE Sensex, fell below the psychological 16,000
level, having alternately moved above and below that mark in intraday
trade. Interest rate sensitive
banking, auto and realty stocks declined after Reserve Bank of India
(RBI) kept cash reserve ratio (CRR) and short-term lending rate steady
after mid-quarter monetary policy review today.
The BSE Sensex was provisionally down 351.10 points or 2.22%, off close to 580 points from the day's high and up about 60 points from the day's low. The market breadth was weak. Capital goods stocks extended recent losses on worries new order flows will be hit adversely in a slowing economy, with L&T and Bhel hitting 52 week lows. IT stocks fell as rupee strengthened against the dollar after the Reserve Bank of India took steps to check the recent sharp slide in the local currency. ICICI Bank, Sterlite Industries and Tata Steel hit 52-week lows.
The market opened on a firm note as Asian stocks rose. The Sensex trimmed gains after hitting fresh intraday high in morning trade. The barometer index, BSE Sensex, alternately moved above and below the psychological 16,000 level in mid-morning trade. A bout of volatility was witnessed in early afternoon trade as key benchmark indices regained strength after paring gains from intraday highs after the Reserve Bank of India (RBI) left its key lending rate unchanged. The RBI announced the decision at about 12:00 IST. The market regained strength in afternoon trade. Volatility was at the forefront as key benchmark indices gave almost all the intraday gains to hit fresh intraday low in mid-afternoon trade after hitting fresh intraday high in afternoon trade. The market slumped in late trade.
Data showing selling by foreign funds recently weighed on sentiment. Foreign institutional investors (FIIs) sold shares worth Rs 323.28 crore on Thursday, 15 December 2011, as per the provisional data from the stock exchanges. FII outflow totaled Rs 1701.09 crore in five trading sessions from 9 to 15 December 2011, as per provisional data from the stock exchanges. The recent outflow followed sustained inflow early this month.
The RBI on Friday left its main lending rate unchanged in order to support faltering economic growth as inflation shows signs of cooling. The central bank also refrained from cutting the cash reserve ratio (CRR) despite tight liquidity in the system. The repo rate has been left steady at 8.5% after increasing it 13 times since March 2010. The bank rate also remains static at 6%. The central bank kept its end-March 2012 inflation forecast unchanged at 7%.
While inflation remains on its projected trajectory, downside risks to growth have clearly increased, RBI said in a statement. The guidance given in the second quarter review of the monetary policy was that, based on the projected inflation trajectory, further rate hikes might not be warranted. In view of the moderating growth momentum and higher downside risks to growth, this guidance is being reiterated, RBI said. From this point on, monetary policy actions are likely to reverse the cycle, responding to the risks to growth, RBI said.
However, it must be emphasized that inflation risks remain high and inflation could quickly recur as a result of both supply and demand forces, the central bank said in statement. Also, the rupee remains under stress, RBI said. The timing and magnitude of further actions will depend on a continuing assessment of how these factors shape up in the months ahead, RBI said. The RBI has raised rates 13 times since March 2010.
RBI said there are currently no significant signs of stress in the money market. However, in view of the fact that borrowings from the LAF are persistently above the Reserve Bank of India's comfort zone, further open market operations (OMOs) will be conducted as and when seen to be appropriate, RBI said.
As per provisional figures, the BSE Sensex was down 351.10 points or 2.22% to 15,485.37. The index jumped 232.43 points at the day's high of 16,068.90 in mid-afternoon trade, its highest level since 14 December 2011. The index slumped 411.27 points at the day's low of 15,425.20 in late trade, its lowest level since its lowest level since 3 November 2009.
The S&P CNX Nifty was down 100 points or 2.11% to 4,646.35, as per provisional figures. The index hit a hit a high of 4,818.85 in intraday trade, its highest level since 14 December 2011. The Nifty hit a low of 4,628.20 in intraday trade, its lowest level since its lowest level since 5 November 2009.
BSE clocked turnover of Rs 2177 crore, higher than Rs 2041.89 crore on Thursday, 15 December 2011.
The market breadth, indicating the overall health of the market, was weak. On BSE, 1,930 shares fell and 820 shares rose. A total of 113 shares were unchanged. The breadth was strong earlier in the day.
From the 30-member Sensex pack, 26 stocks fell and the rest of them rose.
Index heavyweight Reliance Industries (RIL) fell 3.77% to Rs 720.50. The stock was volatile. The stock hit a high of Rs 761.25 and a low of Rs 719. The company's advance tax payment reportedly fell 15.79% to Rs 1002 crore in Q3 December 2011 over Q3 December 2010. Oil minister Jaipal Reddy said in a written reply in the lower house of parliament on Thursday, 15 December 2011, that the decline in gas output from RIL's east coast block is due to the company drilling fewer number of wells than promised and stoppage of production at six wells.
RIL late last month said that it has initiated arbitration proceedings against the government to seek an independent view of a tribunal on the issue of the company's entitlement of recovery of entire costs on KG-D6 gas blocks from the revenue generated from the blocks. RIL said it has initiated arbitration proceedings against the Government of India (GoI) in a bid to finally resolve the cost recovery issue so as not to hinder future investments in this block.
RIL said its investment in KG-D6 production facilities has been only partly recovered and the return on the investment so far is less than the cost of the capital. The production sharing contract (PSC) with the Government of India (GoI) contains no provision which entitles the GoI to restrict the costs recovered by the company by reference to factors such as the level of production or the extent to which field facilities are utilised, RIL said.
Interest rate sensitive realty stocks declined after Reserve Bank of India (RBI) kept short term lending rates steady. Purchases of both residential and commercial property are largely driven by finance. DLF, HDIL, Unitech, and Indiabulls Real Estate fell by between 2.52% to 8.96%.
Capital goods stocks tumbled on worries new order flows will be hit adversely in a slowing economy. Engineering and construction major, L&T slumped 6.31% to Rs 1064.70. The stock hit a 52-week low of Rs 1063 today. The stock was the top loser from the Sensex pack.
Bhel fell 4.06% to Rs 240. The stock hit a 52-week low of Rs 238 today. The stock was the second biggest loser from the Sensex pack.
Among other capital goods stocks, BGR Energy Systems, Bharat Electronics, Suzlon Energy, Praj Industries, Havells India, ABB, and Punj Lloyd shed by between 2.26% to 10.06%.
Sterlite Industries fell 4.28% to Rs 89.40. The stock hit a 52-week low of Rs 88.40 today.
Tata Steel shed 2.72% to Rs 364.95. The stock hit a 52-week low of Rs 362.30 today.
IT stocks fell as rupee strengthened against the dollar after the Reserve Bank of India took steps to check the recent sharp slide in the local currency. India's third largest software services exporter by revenue Wipro fell 0.63%. India's second largest software services exporter by revenue Infosys was flat.
A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports. The rupee was at 52.77/79 per dollar, stronger than its previous close of 53.64/65 on Thursday. The rupee had touched a record low of 54.30 in intraday deals on Thursday.
India's largest software services exporter TCS declined 3.31%. TCS today, 16 December 2011, said it has evacuated nearly 1,600 staff from one of its training facilities in Chennai after a bomb scare at the center. The incident won't have any impact on business operations in Chennai, as the employees were mostly trainees, TCS said in a statement. Police and specialist teams have taken control of the facility and are investigating the incident, the company said.
Interest rate sensitive banking stocks fell after Reserve Bank of India (RBI) kept cash reserve ratio (CRR) and short-term lending rate steady after mid-quarter monetary policy review today. India's second largest private sector bank by net profit, HDFC Bank, declined 3.57%. The bank's advance tax reportedly rose 20% to Rs 900 crore in Q3 December 2011 over Q3 December 2010.
India's largest private sector bank by net profit, ICICI Bank fell 3.18% to Rs 676.05. The stock hit a 52-week low of Rs 667 today. The bank's advance tax reportedly remained flat at Rs 450 crore in Q3 December 2011.
India's largest bank by net profit and branch network State Bank of India (SBI) declined 3.67%. The bank's advance tax reportedly fell 6.48% to Rs 1730 crore in Q3 December 2011 over Q3 December 2010.
The RBI said that year-on-year non-food credit growth at 17.5% on 2 December 2011 was below its indicative projection of 18%.
Interest rate sensitive auto stocks reversed intraday gains as the Reserve Bank of India (RBI) kept short term lending rate steady. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
India's largest passenger vehicle maker by sales Tata Motors fell 0.29%. The company's advance tax reportedly fell 93.27% to Rs 80 crore in Q3 December 2011 over Q3 December 2010. The company's global vehicle sales rose an annual 35% to 1,08,028 units in November 2011 over November 2010, the company said in a statement on Thursday, with its luxury Jaguar Land Rover unit reporting a 27% rise in sales to 29,183 units. Sales of Jaguar cars fell 5% to 5,315 units while those of Land Rover sport-utility vehicles gained 38% to 23,868 units. The company said it sold 49,724 trucks and buses globally in November, up 24% from a year earlier.
India's largest tractor maker by sales Mahindra & Mahindra (M&M) declined 0.94%. The company's advance tax reportedly fell 4.34% to Rs 220 crore in Q3 December 2011 over Q3 December 2010. The company on Thursday, 15 December 2011, said it will raise prices of its vehicles by up to 3% in January 2012 to offset the effects of rising raw-material costs. The company's total auto sales jumped 52.7% to 40,722 units in November 2011 over November 2010.
India's largest car maker by sales Maruti Suzuki India fell 0.24%. The company's total sales fell 18.5% to 91,772 units in November 2011 over November 2010.
Ashok Leyland shed 3.14%. The company reported 53.36% jump in commercial vehicle sales at 7,878 units in November 2011 over November 2010.
India's largest motorcycle maker by sales Hero MotoCorp fell 1.76%. The company's advance tax reportedly rose 50% to Rs 180 crore in Q3 December 2011 over Q3 December 2010. The company's sales rose 27.4% to 536,772 units in November 2011 over November 2010.
India's second largest motorcycle maker by sales Bajaj Auto dropped 0.12%. The company's advance tax reportedly rose 21.62% to Rs 450 crore in Q3 December 2011 over Q3 December 2010. Bajaj Auto's total vehicle sales jumped 25% at 374,477 units in November 2011 over November 2010.
Car sales in India rose in November, the first monthly rise in five, an industry body said on Thursday, 8 December 2011, as the industry rebounded strongly from the biggest fall in over a decade the month before. Domestic passenger car sales increased by 7% to 1,71,131 units in November 2011, from 1,59,939 units in the same month last year. According to figures released by the Society of Indian Automobile Manufacturers (SIAM) on Thursday, motorcycle sales in the country grew by 22.67% to 8,69,070 units during the month from 7,08,476 units in the corresponding month last year. Total two-wheeler sales grew by 25.27% to 11,63,294 units last month from 9,28,660 units in November 2010, as per the data. Sales of commercial vehicles grew by 34.99% to 66,264 units in the month under review from 49,087 units in the year-ago period, SIAM said.
As per reports, advance taxes for the third quarter from corporates headquartered in Mumbai have risen 10%. Cements and pharma companies have reported surge in advance tax payment for the third quarter. Advance taxes are collected in four installments -- 15% by 15 June; 40% by 15 September; 75% by 15 December and 100% by 15 March.
Credit rating agency Moody's Investors Service on Wednesday, 14 December 2011, said that the sharp decline in the value of the Indian rupee against the dollar is generally exerting only a moderate impact on rated Indian companies. Risks for companies holding large amounts of dollar denominated debt are also manageable in the near term, given that debt maturities are limited for this time frame, Moody's said in a new report. This means Indian companies rated by Moody's do not have a significant dollar outflow at a time when the Indian rupee is losing ground. Moody's latest assessment comes as the rupee continued its free fall against the dollar on Thursday, 15 December 2011, sinking to a new record low for the fourth straight day, as investors fled risk-sensitive currencies due to escalating concerns over Europe's sovereign debt crisis.
The Reserve Bank of India (RBI) took steps on Thursday to arrest the free-fall of the rupee after the local currency hit a new record low against the dollar for the fourth consecutive day. The new currency rules include reducing the net amount of US dollar-versus-rupee trade that authorized foreign-exchange dealers can hold on their books. Another measure of the bank's new rules would limit the amount of currency hedging by importers, who typically buy dollars.
A government statement in parliament last month dashed hopes of a relief in securities transaction tax (STT). Junior finance minister S.S. Palanimanickam has said that the government has no proposal to lower the securities transaction tax (STT). There has been a speculation that the government will reduce STT in Union Budget 2012-2013 in a bid to revive sagging volumes on the bourses. Palanimanickam said in a written reply to Rajya Sabha that the securities transaction tax receipts had declined by around 18% to Rs 2960 crore during the first six months in the current fiscal year from a year ago period.
The government last week said that the Rs 40000-crore stakes sale target in state-run companies would be hard to achieve this fiscal year, while tax receipts would suffer from the impact of the global slowdown.
European stock reversed initial gains on Friday. Key benchmark indices in Germany and France fell by between 0.07% to 0.24%. UK's FTSE 100 rose 0.33%.
Asian shares edged higher on Friday, 16 December 2011, as signs of strength in the US economy temporarily broke through gloom over the European debt crisis that had driven a sell-off in riskier assets over the past three days. Key benchmark indices in China, Hong Kong, Indonesia, Japan, Taiwan, Singapore and South Korea rose by between 0.29% to 2.02%.
Trading in US index futures indicated that the Dow could gain 36 points at the opening bell on Friday, 16 December 2011. US stocks rose modestly on Thursday, after a fall in US unemployment, a stronger-than-expected rise in regional factory activity and better-than-forecast results from FedEx Corp painted an improving picture of the economy. Jobless claims in the US dropped to a three and a half year low last week.
Fitch Ratings, the third-biggest of the major credit rating agencies, has downgraded seven global banks based in Europe and the United States, citing "increased challenges" in the financial markets. Bank of America Corp., Goldman Sachs and Citigroup had their credit grades cut by Fitch. Barclays, Credit Suisse, Deutsche Bank and BNP Paribas also had their ratings lowered by Fitch.
The BSE Sensex was provisionally down 351.10 points or 2.22%, off close to 580 points from the day's high and up about 60 points from the day's low. The market breadth was weak. Capital goods stocks extended recent losses on worries new order flows will be hit adversely in a slowing economy, with L&T and Bhel hitting 52 week lows. IT stocks fell as rupee strengthened against the dollar after the Reserve Bank of India took steps to check the recent sharp slide in the local currency. ICICI Bank, Sterlite Industries and Tata Steel hit 52-week lows.
The market opened on a firm note as Asian stocks rose. The Sensex trimmed gains after hitting fresh intraday high in morning trade. The barometer index, BSE Sensex, alternately moved above and below the psychological 16,000 level in mid-morning trade. A bout of volatility was witnessed in early afternoon trade as key benchmark indices regained strength after paring gains from intraday highs after the Reserve Bank of India (RBI) left its key lending rate unchanged. The RBI announced the decision at about 12:00 IST. The market regained strength in afternoon trade. Volatility was at the forefront as key benchmark indices gave almost all the intraday gains to hit fresh intraday low in mid-afternoon trade after hitting fresh intraday high in afternoon trade. The market slumped in late trade.
Data showing selling by foreign funds recently weighed on sentiment. Foreign institutional investors (FIIs) sold shares worth Rs 323.28 crore on Thursday, 15 December 2011, as per the provisional data from the stock exchanges. FII outflow totaled Rs 1701.09 crore in five trading sessions from 9 to 15 December 2011, as per provisional data from the stock exchanges. The recent outflow followed sustained inflow early this month.
The RBI on Friday left its main lending rate unchanged in order to support faltering economic growth as inflation shows signs of cooling. The central bank also refrained from cutting the cash reserve ratio (CRR) despite tight liquidity in the system. The repo rate has been left steady at 8.5% after increasing it 13 times since March 2010. The bank rate also remains static at 6%. The central bank kept its end-March 2012 inflation forecast unchanged at 7%.
While inflation remains on its projected trajectory, downside risks to growth have clearly increased, RBI said in a statement. The guidance given in the second quarter review of the monetary policy was that, based on the projected inflation trajectory, further rate hikes might not be warranted. In view of the moderating growth momentum and higher downside risks to growth, this guidance is being reiterated, RBI said. From this point on, monetary policy actions are likely to reverse the cycle, responding to the risks to growth, RBI said.
However, it must be emphasized that inflation risks remain high and inflation could quickly recur as a result of both supply and demand forces, the central bank said in statement. Also, the rupee remains under stress, RBI said. The timing and magnitude of further actions will depend on a continuing assessment of how these factors shape up in the months ahead, RBI said. The RBI has raised rates 13 times since March 2010.
RBI said there are currently no significant signs of stress in the money market. However, in view of the fact that borrowings from the LAF are persistently above the Reserve Bank of India's comfort zone, further open market operations (OMOs) will be conducted as and when seen to be appropriate, RBI said.
As per provisional figures, the BSE Sensex was down 351.10 points or 2.22% to 15,485.37. The index jumped 232.43 points at the day's high of 16,068.90 in mid-afternoon trade, its highest level since 14 December 2011. The index slumped 411.27 points at the day's low of 15,425.20 in late trade, its lowest level since its lowest level since 3 November 2009.
The S&P CNX Nifty was down 100 points or 2.11% to 4,646.35, as per provisional figures. The index hit a hit a high of 4,818.85 in intraday trade, its highest level since 14 December 2011. The Nifty hit a low of 4,628.20 in intraday trade, its lowest level since its lowest level since 5 November 2009.
BSE clocked turnover of Rs 2177 crore, higher than Rs 2041.89 crore on Thursday, 15 December 2011.
The market breadth, indicating the overall health of the market, was weak. On BSE, 1,930 shares fell and 820 shares rose. A total of 113 shares were unchanged. The breadth was strong earlier in the day.
From the 30-member Sensex pack, 26 stocks fell and the rest of them rose.
Index heavyweight Reliance Industries (RIL) fell 3.77% to Rs 720.50. The stock was volatile. The stock hit a high of Rs 761.25 and a low of Rs 719. The company's advance tax payment reportedly fell 15.79% to Rs 1002 crore in Q3 December 2011 over Q3 December 2010. Oil minister Jaipal Reddy said in a written reply in the lower house of parliament on Thursday, 15 December 2011, that the decline in gas output from RIL's east coast block is due to the company drilling fewer number of wells than promised and stoppage of production at six wells.
RIL late last month said that it has initiated arbitration proceedings against the government to seek an independent view of a tribunal on the issue of the company's entitlement of recovery of entire costs on KG-D6 gas blocks from the revenue generated from the blocks. RIL said it has initiated arbitration proceedings against the Government of India (GoI) in a bid to finally resolve the cost recovery issue so as not to hinder future investments in this block.
RIL said its investment in KG-D6 production facilities has been only partly recovered and the return on the investment so far is less than the cost of the capital. The production sharing contract (PSC) with the Government of India (GoI) contains no provision which entitles the GoI to restrict the costs recovered by the company by reference to factors such as the level of production or the extent to which field facilities are utilised, RIL said.
Interest rate sensitive realty stocks declined after Reserve Bank of India (RBI) kept short term lending rates steady. Purchases of both residential and commercial property are largely driven by finance. DLF, HDIL, Unitech, and Indiabulls Real Estate fell by between 2.52% to 8.96%.
Capital goods stocks tumbled on worries new order flows will be hit adversely in a slowing economy. Engineering and construction major, L&T slumped 6.31% to Rs 1064.70. The stock hit a 52-week low of Rs 1063 today. The stock was the top loser from the Sensex pack.
Bhel fell 4.06% to Rs 240. The stock hit a 52-week low of Rs 238 today. The stock was the second biggest loser from the Sensex pack.
Among other capital goods stocks, BGR Energy Systems, Bharat Electronics, Suzlon Energy, Praj Industries, Havells India, ABB, and Punj Lloyd shed by between 2.26% to 10.06%.
Sterlite Industries fell 4.28% to Rs 89.40. The stock hit a 52-week low of Rs 88.40 today.
Tata Steel shed 2.72% to Rs 364.95. The stock hit a 52-week low of Rs 362.30 today.
IT stocks fell as rupee strengthened against the dollar after the Reserve Bank of India took steps to check the recent sharp slide in the local currency. India's third largest software services exporter by revenue Wipro fell 0.63%. India's second largest software services exporter by revenue Infosys was flat.
A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports. The rupee was at 52.77/79 per dollar, stronger than its previous close of 53.64/65 on Thursday. The rupee had touched a record low of 54.30 in intraday deals on Thursday.
India's largest software services exporter TCS declined 3.31%. TCS today, 16 December 2011, said it has evacuated nearly 1,600 staff from one of its training facilities in Chennai after a bomb scare at the center. The incident won't have any impact on business operations in Chennai, as the employees were mostly trainees, TCS said in a statement. Police and specialist teams have taken control of the facility and are investigating the incident, the company said.
Interest rate sensitive banking stocks fell after Reserve Bank of India (RBI) kept cash reserve ratio (CRR) and short-term lending rate steady after mid-quarter monetary policy review today. India's second largest private sector bank by net profit, HDFC Bank, declined 3.57%. The bank's advance tax reportedly rose 20% to Rs 900 crore in Q3 December 2011 over Q3 December 2010.
India's largest private sector bank by net profit, ICICI Bank fell 3.18% to Rs 676.05. The stock hit a 52-week low of Rs 667 today. The bank's advance tax reportedly remained flat at Rs 450 crore in Q3 December 2011.
India's largest bank by net profit and branch network State Bank of India (SBI) declined 3.67%. The bank's advance tax reportedly fell 6.48% to Rs 1730 crore in Q3 December 2011 over Q3 December 2010.
The RBI said that year-on-year non-food credit growth at 17.5% on 2 December 2011 was below its indicative projection of 18%.
Interest rate sensitive auto stocks reversed intraday gains as the Reserve Bank of India (RBI) kept short term lending rate steady. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.
India's largest passenger vehicle maker by sales Tata Motors fell 0.29%. The company's advance tax reportedly fell 93.27% to Rs 80 crore in Q3 December 2011 over Q3 December 2010. The company's global vehicle sales rose an annual 35% to 1,08,028 units in November 2011 over November 2010, the company said in a statement on Thursday, with its luxury Jaguar Land Rover unit reporting a 27% rise in sales to 29,183 units. Sales of Jaguar cars fell 5% to 5,315 units while those of Land Rover sport-utility vehicles gained 38% to 23,868 units. The company said it sold 49,724 trucks and buses globally in November, up 24% from a year earlier.
India's largest tractor maker by sales Mahindra & Mahindra (M&M) declined 0.94%. The company's advance tax reportedly fell 4.34% to Rs 220 crore in Q3 December 2011 over Q3 December 2010. The company on Thursday, 15 December 2011, said it will raise prices of its vehicles by up to 3% in January 2012 to offset the effects of rising raw-material costs. The company's total auto sales jumped 52.7% to 40,722 units in November 2011 over November 2010.
India's largest car maker by sales Maruti Suzuki India fell 0.24%. The company's total sales fell 18.5% to 91,772 units in November 2011 over November 2010.
Ashok Leyland shed 3.14%. The company reported 53.36% jump in commercial vehicle sales at 7,878 units in November 2011 over November 2010.
India's largest motorcycle maker by sales Hero MotoCorp fell 1.76%. The company's advance tax reportedly rose 50% to Rs 180 crore in Q3 December 2011 over Q3 December 2010. The company's sales rose 27.4% to 536,772 units in November 2011 over November 2010.
India's second largest motorcycle maker by sales Bajaj Auto dropped 0.12%. The company's advance tax reportedly rose 21.62% to Rs 450 crore in Q3 December 2011 over Q3 December 2010. Bajaj Auto's total vehicle sales jumped 25% at 374,477 units in November 2011 over November 2010.
Car sales in India rose in November, the first monthly rise in five, an industry body said on Thursday, 8 December 2011, as the industry rebounded strongly from the biggest fall in over a decade the month before. Domestic passenger car sales increased by 7% to 1,71,131 units in November 2011, from 1,59,939 units in the same month last year. According to figures released by the Society of Indian Automobile Manufacturers (SIAM) on Thursday, motorcycle sales in the country grew by 22.67% to 8,69,070 units during the month from 7,08,476 units in the corresponding month last year. Total two-wheeler sales grew by 25.27% to 11,63,294 units last month from 9,28,660 units in November 2010, as per the data. Sales of commercial vehicles grew by 34.99% to 66,264 units in the month under review from 49,087 units in the year-ago period, SIAM said.
As per reports, advance taxes for the third quarter from corporates headquartered in Mumbai have risen 10%. Cements and pharma companies have reported surge in advance tax payment for the third quarter. Advance taxes are collected in four installments -- 15% by 15 June; 40% by 15 September; 75% by 15 December and 100% by 15 March.
Credit rating agency Moody's Investors Service on Wednesday, 14 December 2011, said that the sharp decline in the value of the Indian rupee against the dollar is generally exerting only a moderate impact on rated Indian companies. Risks for companies holding large amounts of dollar denominated debt are also manageable in the near term, given that debt maturities are limited for this time frame, Moody's said in a new report. This means Indian companies rated by Moody's do not have a significant dollar outflow at a time when the Indian rupee is losing ground. Moody's latest assessment comes as the rupee continued its free fall against the dollar on Thursday, 15 December 2011, sinking to a new record low for the fourth straight day, as investors fled risk-sensitive currencies due to escalating concerns over Europe's sovereign debt crisis.
The Reserve Bank of India (RBI) took steps on Thursday to arrest the free-fall of the rupee after the local currency hit a new record low against the dollar for the fourth consecutive day. The new currency rules include reducing the net amount of US dollar-versus-rupee trade that authorized foreign-exchange dealers can hold on their books. Another measure of the bank's new rules would limit the amount of currency hedging by importers, who typically buy dollars.
A government statement in parliament last month dashed hopes of a relief in securities transaction tax (STT). Junior finance minister S.S. Palanimanickam has said that the government has no proposal to lower the securities transaction tax (STT). There has been a speculation that the government will reduce STT in Union Budget 2012-2013 in a bid to revive sagging volumes on the bourses. Palanimanickam said in a written reply to Rajya Sabha that the securities transaction tax receipts had declined by around 18% to Rs 2960 crore during the first six months in the current fiscal year from a year ago period.
The government last week said that the Rs 40000-crore stakes sale target in state-run companies would be hard to achieve this fiscal year, while tax receipts would suffer from the impact of the global slowdown.
European stock reversed initial gains on Friday. Key benchmark indices in Germany and France fell by between 0.07% to 0.24%. UK's FTSE 100 rose 0.33%.
Asian shares edged higher on Friday, 16 December 2011, as signs of strength in the US economy temporarily broke through gloom over the European debt crisis that had driven a sell-off in riskier assets over the past three days. Key benchmark indices in China, Hong Kong, Indonesia, Japan, Taiwan, Singapore and South Korea rose by between 0.29% to 2.02%.
Trading in US index futures indicated that the Dow could gain 36 points at the opening bell on Friday, 16 December 2011. US stocks rose modestly on Thursday, after a fall in US unemployment, a stronger-than-expected rise in regional factory activity and better-than-forecast results from FedEx Corp painted an improving picture of the economy. Jobless claims in the US dropped to a three and a half year low last week.
Fitch Ratings, the third-biggest of the major credit rating agencies, has downgraded seven global banks based in Europe and the United States, citing "increased challenges" in the financial markets. Bank of America Corp., Goldman Sachs and Citigroup had their credit grades cut by Fitch. Barclays, Credit Suisse, Deutsche Bank and BNP Paribas also had their ratings lowered by Fitch.
Thursday, December 8, 2011
QUICK REVIEW
Sensex provisionally off 2.56%
Key benchmark indices slipped to hit fresh intraday lows in late trade on relentless selling. The 50-unit S&P CNX Nifty fell the psychological 5,000 mark. The barometer index, BSE Sensex, was provisionally down 432.69 points or 2.56%, up about 20 points from the day's low and off close to 400 points from the day's high. The Sensex hit its lowest level in more than a week. Index heavyweight Reliance Industries (RIL) fell nearly 4%. All the 13 sectoral indices on BSE were in the red. The market breadth was weak. Pharma stocks bucked the weak trend on defensive buying.
The market sentiment was hit adversely after a newspaper report suggested that industrial output declined by 7% in October 2011, falling for the first time since June 2009. Unitech, D B Realty and Reliance Anil Dhirubhai Ambani (ADA) Group stocks dropped on concerns about the possible fallout from the ongoing 2G case after a trial court today, 8 December 2011, allowed Janata Party chief Subramanian Swamy to become a witness in his complaint against home minister P Chidambaram in 2G case.
Metal stocks fell as LMEX, a gauge of six metals traded on the London Metal Exchange, dropped 0.63% on Wednesday, 7 December 2011. Capital goods stocks tumbled on reports that the capital goods sector led decline in industrial output in October 2011. Interest rate sensitive banking and realty stocks fell on profit taking after recent gains triggered by hopes a slowing economy could prompt the Reserve Bank of India (RBI) to pause on rate increases next week.
The market trimmed losses after a weak opening. The initial recovery proved short-lived. The market weakened again to hit fresh intraday low in morning trade. The market slumped to hit its lowest levels in nearly one week in mid-morning trade. The market trimmed losses in early afternoon trade as food inflation eased further in late November 2011. The intraday recovery gathered steam in afternoon trade. Intraday volatility continued as key benchmark indices trimmed losses after weakening once again in mid-afternoon trade as European stocks rose in early trade. High volatility was witnessed in late trade.
As per provisional figures, the BSE Sensex was down 432.69 points or 2.56% to 16,444.37. The index declined 29.24 points at the day's high of 16,847.82 in early trade. The index fell 455.51 points at the day's low of 16,421.55 in late trade, its lowest level since 30 November 2011.
The S&P CNX Nifty was down 131.95 points or 2.61% to 4,930.65, as per provisional figures. The Nifty hit a low of 4,921.45 in intraday trade, its lowest level since 2 December 2011. The Nifty hit a high of 5,049.05 in intraday trade.
BSE clocked turnover of Rs 1981 crore lower, than Rs 3092.83 crore on Wednesday, 7 December 2011.
The market breadth, indicating the overall health of the market, was weak. On BSE, 1,959 shares fell and 791 shares rose. A total of 95 shares were unchanged.
From the 30-member Sensex pack, 23 shares fell and rest of them rose. Jaiprakash Associates, M&M and SBI shed by between 3.75% to 5.69%.
Index heavyweight Reliance Industries (RIL) fell 3.73%. The company late last month said that it has initiated arbitration proceedings against the government to seek an independent view of a tribunal on the issue of the company's entitlement of recovery of entire costs on KG-D6 gas blocks from the revenue generated from the blocks. RIL said all the investments in the exploration, development and production of hydrocarbons from KG-D6 were made by RIL and its foreign partners at their own risk, and not by the Government of India (GoI). RIL and its partners are entitled under the production sharing contract (PSC) with the GoI to recover their full costs from the revenues generated by production from the block, RIL said in a statement.
The investment made in KG-D6 production facilities has been only partly recovered and the return on the investment so far is less than the cost of the capital, RIL said. The PSC contains no provision which entitles the GoI to restrict the costs recovered by the company by reference to factors such as the level of production or the extent to which field facilities are utilised, RIL said. RIL said it has initiated arbitration proceedings against the GoI in a bid to finally resolve the cost recovery issue so as not to hinder future investments in this block.
India's third largest software services exporter by revenue Wipro rose 2.68%. Wipro Technologies, the global information technology, consulting and outsourcing business of Wipro, has announced its plans to create a focused global unit called Business Operation Unit, which will enable Wipro to deliver differentiated value for clients with seamless, predictable execution. It will consolidate its business application services, global delivery, quality and IS teams under the newly formed Business Operation Unit.
Unitech, D B Realty and Reliance Anil Dhirubhai Ambani (ADA) Group stocks dropped on concerns about the possible fallout from the ongoing 2G case after a trial court today, 8 December 2011, allowed Janata Party chief Subramanian Swamy to become a witness in his complaint against home minister P Chidambaram in 2G case. Among the Reliance ADA group companies, Reliance Communications, Reliance Infrastructure, Reliance Capital, Reliance Power and Reliance MediaWorks shed by between 3.22% to 5.79%. Unitech and D B Realty tumbled by between 5.06% to 5.37%.
Special court's move to allow a plea against Home Minister P. Chidambaram has raised fresh fears about the outcome of the case for companies named by the CBI. Although the Reliance ADA officials who are co-accused in the 2G case have been granted bail by the courts, a special court's move today to allow a plea against Chidambaram has raised fresh fears about the outcome of the case for companies named by the CBI.
Interest rate sensitive banking stocks fell on profit taking after gaining recently on hopes a slowing economy could prompt the Reserve Bank of India (RBI) to pause on rate increases this month. India's largest private sector bank by net profit ICICI Bank dropped 3.09%. India's second largest private sector bank by net profit HDFC Bank fell 2.78%. India's largest bank by net profit and branch network State Bank of India (SBI) declined 3.74%.
Capital goods stocks tumbled on reports that the capital goods sector led decline in industrial output in October 2011. Bhel, Thermax, ABB, Punj Lloyd, Praj Industries, L&T and Siemens dropped by between 1.02% to 5.91%.
Interest rate sensitive realty stocks fell on profit taking after recent gains triggered by hopes a slowing economy could prompt the Reserve Bank of India (RBI) to pause on rate increases this month. Purchases of both residential and commercial property are largely driven by finance. DLF, Indiabulls Real Estate, and HDIL fell by between 4% to 6.98%.
Metal stocks fell as LMEX, a gauge of six metals traded on the London Metal Exchange, dropped 0.63% on Wednesday, 7 December 2011. Sterlite Industries, Jindal Steel & Power, JSW Steel, Tata Steel, Hindalco Industries, Hindustan Zinc and Nalco shed by between 1.28% to 5.64%.
Coal India lost 3.19% after the company reportedly lowered its production target for the ongoing financial year ending March 2012 to at least 440 million tonnes from the estimate of 452 million tonnes in its annual plan.
Airline stocks tumbled in a weak market. Jet Airways, Kingfisher Airlines and SpiceJet shed by between 2.53% to 5.32%.
Pharma stocks bucked the weak trend. Cipla and Sun Pharmaceutical Industries gained 1.31% and 1.58%, respectively.
Cairn India fell 3.74%. British oil firm Cairn Energy Plc today said it has completed the sale of 30% stake in its Indian unit Cairn India to mining giant Vedanta. Sesa Goa, a unit of London-listed Vedanta Resources, had yesterday stated that it has raised its stake in Cairn India to 20% following the acquisition of additional shares, amounting to a 1.5% stake. Cairn Energy said it retains about 22% in Cairn India. Shares of Sesa Goa slumped 6.36%.
Infotech Enterprises declined 1.3% after 0.36% equity changed hands in a bulk deal on the BSE today, 8 December 2011.
A government statement in parliament has dashed hopes of a relief in securities transaction tax (STT). Junior finance minister S.S. Palanimanickam, last month, said that the government has no proposal to lower the securities transaction tax (STT). There has been a speculation that the government will reduce STT in Union Budget 2012-2013 in a bid to revive sagging volumes on the bourses. Palanimanickam said in a written reply to Rajya Sabha that the securities transaction tax receipts had declined by around 18% to Rs 2960 crore during the first six months in the current fiscal year from a year ago period.
A newspaper report today, 8 December 2011, quoted an unnamed source as saying that industrial output declined by 7% in October 2011, dragged down by a fall in the capital goods sector. The last time the industrial production had reported a decline was way back in June 2009. "Initial estimates show that industrial production has shrunk by 7%. But with more data coming in, the decline may be around 5%," the newspaper quoted the source as saying. The government is due to officially announce the industrial production date for October 2011 on Monday, 12 December 2011.
Food inflation in India slid further in the fourth week of November, falling under the 7% mark, data released by the Government showed on Thursday. Fuel inflation remained steady. Food inflation declined to 6.6% in the week ended November 26 from 8% in the preceding week, the Commerce & Industry Ministry said today. Food inflation stood at 8.93% in the corresponding week last year. Inflation in the Primary Articles group fell to 6.92% in the week under review, from 7.74% in the week ended November 19, according to the Commerce Ministry statement. It was at 14.01% in the year-ago period. Inflation in the Fuel & Power group stood at 15.53% in the week ended November 26, unchanged compared to the previous week, the latest data showed. It was at 10.07% in the comparable week of the previous year.
Meanwhile, a trial court has allowed Janata Party chief Subramanian Swamy to become a witness in his complaint against home minister P Chidambaram in 2G case. The Court has asked Swamy to appear in the witness box on December 17 to make his statement. The special CBI court will then decide on Swamy's plea to examine witnesses to establish Chidambaram's alleged role in the second generation (2G) spectrum allocation scam.
The court had accepted Swamy's plea to examine two officials in the 2G case which he says will help him prove Union home minister P Chidambaram's alleged role in the scam. As part of the process of establishing Chidambaram's alleged role, Swamy had sought the court's permission to examine the two witnesses -- a joint director of the CBI and a joint secretary in the finance ministry. Swamy's demand is that Chidambaram be made a co-accused in the 2G case. Swamy says that decisions taken by then telecom minister A raja, who has been jailed over the 2G scam, were endorsed by Chidambaram and demands the CBI investigate Chidambaram's role in the scam.
The Indian economy expanded at a substantially lower rate in the second quarter of the current fiscal year as a series of rate increases by the RBI and a global slowdown hurt local demand. India's economy grew 6.9% in Q2 September 2011, in line with expectations, after expanding by 7.7% in the first quarter, government data showed on 30 November 2011. The manufacturing sector grew an annual 2.7% during the July-September quarter while farm output rose an annual 3.2% the data showed. India's GDP growth in the first six months of FY 2012 stood at 7.3% versus 8.6% in the corresponding period of the last financial year, the CSO data showed on 30 November 2011.
The output of the eight infrastructure industries dropped to an over six-year low of 0.1% in October 2011, data released on 30 November 2011 showed, suggesting further slowdown in already wobbly industrial growth. The eight infrastructure industries together have a 38% weight in the index of industrial production (IIP), which makes the infrastructure index a good leading indicator of industrial production.
India's manufacturing sector expansion slowed in November as factory output grew at its slowest pace in nearly three years although export demand should provide some cheer for factories, a survey showed on 1 December 2011. The HSBC Markit India Manufacturing PMI fell to 51 in November from 52 in October, but has stayed above the 50 mark that divides growth from contraction for 32 months. The PMI was 50.4 in September.
On the flip side, India's services sector expanded in November for the first time in two months as new business accelerated despite persistent inflationary pressures, a survey showed on Monday. The seasonally adjusted HSBC Markit Business Activity Index -- based on a survey of around 400 firms -- stood at 53.2 in November, above the 50-mark that separates growth from contraction. It had fallen to 49.1 in October after contracting for the first time in more than two years in September to 49.8. Despite tight monetary conditions, the sub-index for new business accelerated to 52.3 in November from 51 in October, driving the turnaround in the service sector.
India's merchandise exports in October rose by 10.8% to $19.87 billion, while imports during the same month climbed by 22% to $39.51 billion, data released by the government showed on 1 December 2011. As a result, the trade deficit for October 2011 stood at $19.64 billion versus $14.53 billion in the corresponding month a year earlier.
The Reserve Bank of India (RBI) announced a 25 basis points hike in its key policy rate viz. the repo rate to 8.5% after half-yearly review of the monetary policy on 25 October 2011. The central bank cut its GDP growth forecast for the current fiscal year through March 2012 to 7.6% from 8% earlier. But it retained its March-end inflation projection of 7%. RBI said the projected inflation trajectory indicates that the inflation rate will begin falling in December 2011 (January 2012 release) and then continue down a steady path to 7% by March 2012. It is expected to moderate further in the first half of 2012-13. This reflects a combination of commodity price movements and the cumulative impact of monetary tightening. Further, moderating inflation rates are likely to impact expectations favourably. RBI unveils mid-quarter monetary policy review on 16 December 2011.
European stocks rose on Thursday in anticipation of a rate cut by the European Central Bank and ahead of a key European Union summit to discuss and look for a solution to the euro-zone debt crisis. Key benchmark indices in France, Germany and UK rose by between 0.26% to 0.69%.
Investors await results of meetings this week of the European Union and European Central Bank (ECB). European leaders are due to meet in Brussels on Thursday, 8 December 2011, for a two-day summit billed as crucial for the debt-stricken region. German Chancellor Angela Merkel and French President Nicolas Sarkozy have proposed broad treaty changes that would toughen fiscal rules and impose automatic sanctions on countries that violate budget limits.
Meanwhile, the ECB is likely to reduce its benchmark rate to 1% from 1.25% at a policy meeting later in the global day today, 8 December 2011. The ECB may also announce additional liquidity measures. The Bank of England (BoE) also meets today to review its monetary policy. The BoE is expected to leave its monetary policy unchanged.
Asian stocks dropped on Thursday ahead of a European summit on the region's sovereign debt crisis, and as economic data from Japan and Australia signaled the global economy is slowing. Key benchmark indices in China, Hong Kong, Indonesia, Japan, Singapore, South Korea and Taiwan fell by between 0.12% to 1.95%.
Japan's machinery orders unexpectedly fell for a second straight month in October. Australia's unemployment rate ticked up to 5.3% as employers unexpectedly reduced their payrolls in November.
South Korea's central bank on Thursday left its main policy rate steady to protect domestic growth amid growing concerns about the health of the US and European economies. The Bank of Korea kept its benchmark rate at 3.25% for a sixth month, it said in Seoul today. The rate has been on hold since the last rate increase in June. Bank Indonesia, too, maintained borrowing costs at 6%. Bank Indonesia said its decision reflected risks to growth.
Trading in US index futures indicated that the Dow could fall 15 points at the opening bell on Thursday, 8 December 2011. US stocks were little changed in choppy, light trading on Wednesday as investor reacted to reports from Europe ahead of that region's summit of leaders to discuss the 2-year old euro-zone sovereign debt crisis.
inflation - 08-12-2011
Inflation: Primary Articles 6.92% (previous week 7.74%), Food Articles 6.60% (previous week 8.00%) and Fuel, Power 15.53% (Previous week 15.53%)
PRE-SESSION
Market may open lower on weak Asian stocks; food inflation data eyed
The market may open lower tracking weak Asian stocks. Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a fall of 16 points at the opening bell.
On the macro front, the government will today, 8 December 2011, will unveil data on some wholesale price indices viz. the food price index, the primary articles index and the fuel price index for the year through 26 November 2011.
Key benchmark indices edged higher in a volatile trading session on Wednesday, 7 December 2011, on firm global cues. Both Sensex and Nifty ended at their highest closing levels since 15 November 2011. The BSE Sensex rose 71.73 points or 0.43% to 16,877.06, its highest closing level since 15 November 2011.
Foreign institutional investors (FIIs) bought shares worth Rs 135.36 crore on Wednesday, 7 December 2011, as per the provisional data from the stock exchanges. FIIs bought shares worth Rs 1566.25 crore so far in the month of December, as per the data from the stock exchanges.
The Indian government's recent steps to boost investment are a credit positive as they could increase foreign investment and improve the business climate, Moody's Investors Service said in a report Monday. Recent government steps to draw more funds into the country include a proposal to allow majority foreign ownership in the retail sector and steps to reduce regulatory hurdles for national manufacturing zones, Moody's noted. Other recent measures include the easing of rules on foreign investment in infrastructure debt funds and modernizing of corporate investment laws.
A government statement in parliament has dashed hopes of a relief in securities transaction tax (STT). Junior finance minister S.S. Palanimanickam, recently said the government has no proposal to lower the securities transaction tax (STT). There has been a speculation that the government will reduce STT in Union Budget 2012-2013 in a bid to revive sagging volumes on the bourses. Palanimanickam said in a written reply to Rajya Sabha that the securities transaction tax receipts had declined by around 18% to Rs 2960 crore during the first six months in the current fiscal year from a year ago period.
The Indian economy expanded at a substantially lower rate in the second quarter of the current fiscal year as a series of rate increases by the RBI and a global slowdown hurt local demand. India's economy grew 6.9% in Q2 September 2011, in line with expectations, after expanding by 7.7% in the first quarter, government data showed on 30 November 2011. The manufacturing sector grew an annual 2.7% during the July-September quarter while farm output rose an annual 3.2% the data showed. India's GDP growth in the first six months of FY12 stood at 7.3% versus 8.6% in the corresponding period of the last financial year, the CSO data showed on 30 November 2011.
The output of the eight infrastructure industries dropped to an over six-year low of 0.1% in October, data released on 30 November 2011 showed, suggesting further slowdown in already wobbly industrial growth. The eight infrastructure industries together have a 38% weight in the index of industrial production (IIP), which makes the infrastructure index a good leading indicator of industrial production.
India's manufacturing sector expansion slowed in November as factory output grew at its slowest pace in nearly three years although export demand should provide some cheer for factories, a survey showed on 1 December 2011. The HSBC Markit India Manufacturing PMI fell to 51.0 from 52.0 in October, but has stayed above the 50 mark that divides growth from contraction for 32 months. The PMI was 50.4 in September.
On the flip side, India's services sector expanded in November for the first time in two months as new business accelerated despite persistent inflationary pressures, a survey showed on Monday. The seasonally adjusted HSBC Markit Business Activity Index -- based on a survey of around 400 firms -- stood at 53.2 in November, above the 50-mark that separates growth from contraction. It had fallen to 49.1 in October after contracting for the first time in more than two years in September to 49.8. Despite tight monetary conditions, the sub-index for new business accelerated to 52.3 in November from 51.0 in October, driving the turnaround in the service sector.
India's merchandise exports in October rose by 10.8% to $19.87 billion, while imports during the same month climbed by 22% to $39.51 billion, data released by the Government showed on 1 December 2011. As a result, the trade deficit for October 2011 stood at $19.64 billion versus $14.53 billion in the corresponding month a year earlier.
Food inflation tumbled in the third week of November but fuel inflation increased marginally, data released by the Government showed on Thursday, 1 December 2011. Food inflation declined to 8% in the week ended November 19 from 9.01% in the preceding week, the Commerce & Industry Ministry said. Food inflation stood at 9.03% in the corresponding week last year.
The Reserve Bank of India (RBI) announced a 25 basis points hike in its key policy rate viz. the repo rate to 8.5% after half-yearly review of the monetary policy on 25 October 2011. The central bank cut its GDP growth forecast for the current fiscal year through March 2012 to 7.6% from 8% earlier. But it retained its March-end inflation projection of 7%. RBI said the projected inflation trajectory indicates that the inflation rate will begin falling in December 2011 (January 2012 release) and then continue down a steady path to 7% by March 2012. It is expected to moderate further in the first half of 2012-13. This reflects a combination of commodity price movements and the cumulative impact of monetary tightening. Further, moderating inflation rates are likely to impact expectations favourably. RBI unveils mid-quarter monetary policy review on 16 December 2011.
Asian stocks dropped on Thursday ahead of a European summit on the region's sovereign debt crisis, and as economic data from Japan and Australia signaled the global economy is slowing. Key benchmark indices in China, Hong Kong, Indonesia, Japan, Singapore, South Korea and Taiwan fell by between 0.6% to 1.76%.
Investors await results of meetings this week of the European Union and European Central Bank (ECB). The idea of a much stronger bailout fund will be proposed along with the plan on revising existing treaties to strengthen budget rules across the euro area when leaders from 27 European Union countries meet tomorrow, 9 December 2011.
The ECB is likely to reduce its benchmark rate to 1% from 1.25% today, 8 December 2011 as per market expectations.
U.S. stocks were little changed in choppy, light trading on Wednesday as investors weighed high expectations about an upcoming euro zone summit against headline-driven selling.
The market may open lower tracking weak Asian stocks. Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a fall of 16 points at the opening bell.
On the macro front, the government will today, 8 December 2011, will unveil data on some wholesale price indices viz. the food price index, the primary articles index and the fuel price index for the year through 26 November 2011.
Key benchmark indices edged higher in a volatile trading session on Wednesday, 7 December 2011, on firm global cues. Both Sensex and Nifty ended at their highest closing levels since 15 November 2011. The BSE Sensex rose 71.73 points or 0.43% to 16,877.06, its highest closing level since 15 November 2011.
Foreign institutional investors (FIIs) bought shares worth Rs 135.36 crore on Wednesday, 7 December 2011, as per the provisional data from the stock exchanges. FIIs bought shares worth Rs 1566.25 crore so far in the month of December, as per the data from the stock exchanges.
The Indian government's recent steps to boost investment are a credit positive as they could increase foreign investment and improve the business climate, Moody's Investors Service said in a report Monday. Recent government steps to draw more funds into the country include a proposal to allow majority foreign ownership in the retail sector and steps to reduce regulatory hurdles for national manufacturing zones, Moody's noted. Other recent measures include the easing of rules on foreign investment in infrastructure debt funds and modernizing of corporate investment laws.
A government statement in parliament has dashed hopes of a relief in securities transaction tax (STT). Junior finance minister S.S. Palanimanickam, recently said the government has no proposal to lower the securities transaction tax (STT). There has been a speculation that the government will reduce STT in Union Budget 2012-2013 in a bid to revive sagging volumes on the bourses. Palanimanickam said in a written reply to Rajya Sabha that the securities transaction tax receipts had declined by around 18% to Rs 2960 crore during the first six months in the current fiscal year from a year ago period.
The Indian economy expanded at a substantially lower rate in the second quarter of the current fiscal year as a series of rate increases by the RBI and a global slowdown hurt local demand. India's economy grew 6.9% in Q2 September 2011, in line with expectations, after expanding by 7.7% in the first quarter, government data showed on 30 November 2011. The manufacturing sector grew an annual 2.7% during the July-September quarter while farm output rose an annual 3.2% the data showed. India's GDP growth in the first six months of FY12 stood at 7.3% versus 8.6% in the corresponding period of the last financial year, the CSO data showed on 30 November 2011.
The output of the eight infrastructure industries dropped to an over six-year low of 0.1% in October, data released on 30 November 2011 showed, suggesting further slowdown in already wobbly industrial growth. The eight infrastructure industries together have a 38% weight in the index of industrial production (IIP), which makes the infrastructure index a good leading indicator of industrial production.
India's manufacturing sector expansion slowed in November as factory output grew at its slowest pace in nearly three years although export demand should provide some cheer for factories, a survey showed on 1 December 2011. The HSBC Markit India Manufacturing PMI fell to 51.0 from 52.0 in October, but has stayed above the 50 mark that divides growth from contraction for 32 months. The PMI was 50.4 in September.
On the flip side, India's services sector expanded in November for the first time in two months as new business accelerated despite persistent inflationary pressures, a survey showed on Monday. The seasonally adjusted HSBC Markit Business Activity Index -- based on a survey of around 400 firms -- stood at 53.2 in November, above the 50-mark that separates growth from contraction. It had fallen to 49.1 in October after contracting for the first time in more than two years in September to 49.8. Despite tight monetary conditions, the sub-index for new business accelerated to 52.3 in November from 51.0 in October, driving the turnaround in the service sector.
India's merchandise exports in October rose by 10.8% to $19.87 billion, while imports during the same month climbed by 22% to $39.51 billion, data released by the Government showed on 1 December 2011. As a result, the trade deficit for October 2011 stood at $19.64 billion versus $14.53 billion in the corresponding month a year earlier.
Food inflation tumbled in the third week of November but fuel inflation increased marginally, data released by the Government showed on Thursday, 1 December 2011. Food inflation declined to 8% in the week ended November 19 from 9.01% in the preceding week, the Commerce & Industry Ministry said. Food inflation stood at 9.03% in the corresponding week last year.
The Reserve Bank of India (RBI) announced a 25 basis points hike in its key policy rate viz. the repo rate to 8.5% after half-yearly review of the monetary policy on 25 October 2011. The central bank cut its GDP growth forecast for the current fiscal year through March 2012 to 7.6% from 8% earlier. But it retained its March-end inflation projection of 7%. RBI said the projected inflation trajectory indicates that the inflation rate will begin falling in December 2011 (January 2012 release) and then continue down a steady path to 7% by March 2012. It is expected to moderate further in the first half of 2012-13. This reflects a combination of commodity price movements and the cumulative impact of monetary tightening. Further, moderating inflation rates are likely to impact expectations favourably. RBI unveils mid-quarter monetary policy review on 16 December 2011.
Asian stocks dropped on Thursday ahead of a European summit on the region's sovereign debt crisis, and as economic data from Japan and Australia signaled the global economy is slowing. Key benchmark indices in China, Hong Kong, Indonesia, Japan, Singapore, South Korea and Taiwan fell by between 0.6% to 1.76%.
Investors await results of meetings this week of the European Union and European Central Bank (ECB). The idea of a much stronger bailout fund will be proposed along with the plan on revising existing treaties to strengthen budget rules across the euro area when leaders from 27 European Union countries meet tomorrow, 9 December 2011.
The ECB is likely to reduce its benchmark rate to 1% from 1.25% today, 8 December 2011 as per market expectations.
U.S. stocks were little changed in choppy, light trading on Wednesday as investors weighed high expectations about an upcoming euro zone summit against headline-driven selling.
Wednesday, December 7, 2011
Friday, December 2, 2011
Currency Exchange Rate
Currency Exchange Rate
| Currency | Rupee  | US $ | Euro € | UK £ | Aus $ | Japanese ¥ | Singapore $ | Renminbi | Taiwan $ |
|---|---|---|---|---|---|---|---|---|---|
| 1 Rupee = |
1 | 0.0195 | 0.0146 | 0.0125 | 0.0191 | 1.5221 | 0.0251 | 0.1242 | 0.5887 |
| 1 US $ = | 51.2050 | 1 | 0.7480 | 0.6414 | 1.0214 | 77.9400 | 1.2847 | 6.3596 | 30.1420 |
| 1 Euro € = | 68.4559 | 1.3369 | 1 | 0.8575 | 1.3089 | 104.1979 | 1.7175 | 8.5021 | 40.2968 |
| 1 UK £ = | 79.8332 | 1.5591 | 1.1662 | 1 | 1.5264 | 121.5154 | 2.0030 | 9.9152 | 46.9941 |
| 1 Aus $ = | 52.3008 | 1.0214 | 0.7640 | 0.6551 | 1 | 79.6079 | 1.3122 | 6.4957 | 30.7870 |
| 1 Japanese ¥ = | 0.6570 | 0.0128 | 0.0096 | 0.0082 | 0.0126 | 1 | 0.0165 | 0.0816 | 0.3867 |
| 1 Singapore $ = | 39.8576 | 0.7784 | 0.5822 | 0.4993 | 0.7621 | 60.6679 | 1 | 4.9503 | 23.4623 |
| 1 Renminbi = | 8.0516 | 0.1572 | 0.1176 | 0.1009 | 0.1539 | 12.2555 | 0.2020 | 1 | 4.7396 |
| 1 Taiwan $ = | 1.6988 | 0.0332 | 0.0248 | 0.0213 | 0.0325 | 2.5858 | 0.0426 | 0.2110 | 1 |
Thursday, December 1, 2011
Ranbaxy Labs spurts on USFDA approval for generic Lipitor
Ranbaxy Laboratories spurted 6.88% at Rs 464.70 at 9:31 IST after the firm on Wednesday, 30 November 2011, received approval from the United States health regulator to launch the generic version of cholesterol lowering drug Lipitor in the US market.
Metal stocks track surge in industrial metal prices
Twelve metal and mining shares rose by 1.15% to 7.96% at 10:15 IST on BSE as LMEX, a gauge of six metals traded on the London Metal Exchange, surged 5% to settle at $3,436.90 on 30 November 2011.
Sterlite Industries (up 7.96%), Hindalco Industries (up 7.22%), Sesa Goa (up 5.75%), Tata Steel (up 5.22%), JSW Steel (up 4.62%), Sail (up 4.47%), Jindal Steel & Power (up 4.09%), Hindustan Zinc (up 3.65%), NMDC (up 3.20%), Nalco (up 2.18%), Bhushan Steel (up 2.05%) and Coal India (up 1.15%), edged higher.
The BSE Metal index was up 4.96% at 10,731.26. It outperformed the Sensex, which was up 2.93% at 16,595.22.
The BSE Metal index had underperformed the market over the past one month until 30 November 2011, sliding 15.80% compared with the Sensex's 9.44% decline. The BSE Metal index had also underperformed the market in past one quarter, falling 15.48% as against 3.32% fall in the Sensex.
Tuesday, November 29, 2011
Thursday, November 24, 2011
inflation 24-11-2011
Inflation: Primary Articles 9.08% (previous week 10.39%), Food Articles 9.01% (previous week 10.63%) and Fuel, Power 15.49% (Previous week 15.49%)..
