Posts Tagged ‘Indian stocks’

Weekly Update 26th – 30th April 2010

Domestic markets started the week on a negative note on the back of the Greek debt issues and Goldman Sachs fraud issues, but managed to close in the positive terrain supported by firm US markets in line with less than expected hike in Policy Rates & Cash Reserve Ratio by RBI to tame the inflation; Policy rates and CRR increased by 25 bps each. The food price index rose 17.65% in the 12 months to April 10, marginally higher than an annual rise of 17.22% in the previous week. Moreover IMF announcement of India`s growth at 8.5% for the calendar 2011 boosted the sentiments.

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Additionally, announcement of government recapitalization of PSU banks stimulated banking sector and banking stocks were among the major gainers of the week. Good corporate numbers, expectation of good monsoon together with buying by foreign institutions kept the momentum intact for the rest of the week. Going forward market participants globally would be closely watching G20 finance chiefs plan to withdraw economic stimulus as the recovery strengthens.

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The IMF this week said that rising government debt is one of the biggest threats to the world economy.

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Forecast of normal monsoon season by Indian Meteorological department may keep the sentiments positive in the coming week but volatility may rise ahead of the expiry. On the global front, the UK’s economy grew at a slower than anticipated pace in the first quarter. In US, sales of new homes surged by 27 percent in March and orders for most durable goods climbed, indicating the U.S. economy is speeding ahead into the second quarter. Greece troubles that kept the markets jittery especially for the payments approaching in the month of May came to an end after it said that it has sought a relief aid from the European Union to save it from a default.

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US stock markets kept the rally intact which held the other world markets and did not let them fall.

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Shanghai remained under pressure as commodities saw some pressure and profit booking at higher levels. Indian stocks are seeing more strength in cash stocks and banking stocks. Nifty has support between 5200-5100 levels and Sensex between 17400-17200 levels.

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This week is full of event risk, especially from US economy side. Gradually, commodity is retreating from the higher levels but it will be too early to say that it is giving a clear indication for the approaching time. But yes, upside is limited.

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Negative expectation of US GDP figure for the first quarter may hammer the prices. If dollar index trades above the level of 82 then it would keep gold to be in sideways territory. Copper saw three weeks nonstop downside and it is expected to see more downside. Range trading in crude oil is indicating the saturation at the higher levels and market needs big news to see further upside..

Indian Stocks Rose After Govt Approved Disinvestment Plans

Indian Stocks Rose After Govt Approved Disinvestment Plans

Indian Stocks Rose After Govt Approved Disinvestment Plans

Indian stocks rose, extending the benchmark index’s longest string of gains in five weeks, after the government approved a plan to sell more shares in state- controlled companies, helping it raise funds to boost spending.

MMTC Ltd., India’s biggest state-owned trading company, surged 20 percent, the most in 10 months.

Rico Auto Industries Ltd., an auto component maker that supplies General Motors Co. and Ford Motor Co., climbed 5.1 percent after workers ended a 45-day strike.

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The Bombay Stock Exchange’s Sensitive Index, or Sensex, rose 94.38, or 0.6 percent, to 16,158.28.
The measure this week gained 1.7 percent, snapping two weeks of losses.

The S&P CNX Nifty Index on the National Stock Exchange rose 0.6 percent to 4,796.15.
The BSE 200 Index added 1.1 percent to 2,011.08.

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“The disinvestment move will help moderate India’s fiscal deficit,” said Jagannadham Thunuguntla, head of equities at SMC Capitals Ltd. in New Delhi.

“Also, it may help in higher GDP growth led by increased government spending.”

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MMTC soared 20 percent to 36,146.85 rupees, the most since Dec. 17.
State Trading Corp., the No. 2, leapt 15 percent to 353.6 rupees.

NMDC Ltd., India’s largest iron-ore producer, climbed 10 percent to 338 rupees. 

Hindustan Copper Ltd., India’s biggest copper miner, 99.59 percent state-owned, gained 10 percent to 256.35 rupees.

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Budget Deficit

The government owns 99.33 percent in MMTC and 91.02 percent in State Trading, while it holds 98.38 percent in NMDC, according to filings to the Bombay Stock Exchange.

The government will use the money raised from the sale of shares of state companies for social spending.

India’s fiscal deficit reached 6 percent of gross domestic product in the year ended March 31, surpassing the 2.5 percent government target.

The key Sensitive stock index has more than doubled from this year’s lowest level, in March.

Govt’s stand to sell state assets and accept more overseas funds into insurance and banking, has strengthened, after Prime Minister Manmohan Singh resounding re-election victory in May.

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Stock Markets Reversed Early Losses, Sensex & Metal Stocks..Up :)

India’s benchmark stock index rose the most in a week, reversing earlier losses.

India’s benchmark stock index rose the most in a week, reversing earlier losses.

India’s benchmark stock index rose the most in a week, reversing earlier losses.

Sterlite Industries (India) Ltd. and Hindalco Industries Ltd. led commodity producers higher after metals prices jumped.

Sterlite, the nation’s largest copper producer jumped 3.1 percent after the price of the metal gained and the stock’s rating was lifted at Nomura Holdings Inc.

Hindalco Industries leapt 6.2 percent after aluminum soared.

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The market reversed early losses helped by metal stocks.

Also, gains in Asian and European markets boosted sentiment here.

The Bombay Stock Exchange’s Sensitive Index, or Sensex, added 92.13, or 0.6 percent, the most since Sept. 30, to 16,958.54.

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The gauge had earlier declined as much as 1.5 percent.

The S&P CNX Nifty Index on the National Stock Exchange rose 0.5 percent to 5,027.40.

The BSE 200 Index advanced 0.4 percent to 2,072.31.

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European and Asian stocks gained as higher commodities lifted metal producers, while financial shares advanced after Bank of America Merrill Lynch Global Research recommended European banks.

Europe’s Dow Jones Stoxx 600 Index gained 1.4 percent to 239.19 at 12:26 p.m. in London, while futures on the Standard & Poor’s 500 Index rose 0.8 percent.

The MSCI Asia Pacific Index advanced for the first time in four days today, adding 1.5 percent.

Overseas funds bought a net 13.7 billion rupees ($286.7 million) of Indian stocks on Oct. 1, the Securities and Exchange Board of India said.

The funds have bought 615 billion rupees of Indian stocks this year to date, compared with record net sales of 530 billion rupees for the whole of 2008.

However, Reliance Communications Ltd., India’s second-largest mobile phone operator, led declines by telecom companies on concern lower call charges will cut earnings.

“The price war can impact the revenues of telecom companies by 15 percent to 20 percent,” said Jagannadham Thunuguntla, the head of equities at SMC Capitals Ltd. in New Delhi.

Kotak Securities removed Bharti from its list of 10 most recommended stocks following yesterday’s downgrade.

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On Energy front, Oil & Natural Gas Corp., the biggest energy explorer, added 1.3 percent to 1,184.8 rupees after saying its in talks with Iran’s state-owned Petropars Ltd. to buy a stake in South Pars, the country’s largest natural gas field.

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Indian Stocks Rose to a 15-Month High :)

Indian-stocks-15-month high

Indian stocks rose to a 15-month high yesterday. 🙂

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DLF Ltd led gains as investors judged recent declines as excessive. Mahindra & Mahindra Ltd climbed on a report it will make sports utility vehicles for overseas markets.

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DLF, the biggest real estate developer, jumped 5.5% after losing 10% in the previous five trading sessions.

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Mahindra & Mahindra, the largest sports utility vehicle maker, advanced 1.5%.

Sterlite Industries (India) Ltd, the No 1 copper producer, added 3.8% after metals prices climbed.

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The Bombay Stock Exchange’s Sensitive Index (Sensex), rose 240.26, or 1.5%, to 16,454.45, the highest since May 28, 2008.

The gauge declined 0.3% on Monday, snapping a six-day rally.

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“There is strong liquidity supporting the market,” Jagannadham Thunuguntla, the head of equities at SMC Capitals Ltd in New Delhi. “Yesterday’s fall has made some stocks attractive.”

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The rupee advanced against the US dollar as overseas investors added to holdings of the nation’s assets amid signs economic growth is quickening.

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The rupee climbed 0.2% to 48.655 per dollar at the 5pm close in Mumbai, according to data compiled by Bloomberg.

The currency has risen 0.4% this month.

India’s $1.2tn economy expanded 6.1% in the three months to June from a year earlier, accelerating for the first time since 2007, the government said last month.

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India May Trigger $39 Billion of Share Sales With Ownership Cap :)

India Shines

India may trigger as much as 1.9 trillion rupees ($39 billion) in stock sales, equivalent to five years of equity offerings, with a proposal to limit stakes of controlling shareholders.

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Prime Minister Manmohan Singh’s government is considering a plan that would require at least 25 percent of a company’s stock to be traded.

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The rule would prompt equity sales in 560 of Mumbai’s 3,335 most-active stocks, such as NMDC Ltd. and Steel Authority of India Ltd., according to data compiled by Bloomberg.

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The changes may encourage foreign investment by bringing Indian regulations in line with the U.S., U.K. and Hong Kong.

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The 25 percent minimum would be good for the long-term Indian market. There are many very attractive companies with small floats that investors would like to be able to invest in.

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The rule change would require the government, whose constitution embraces socialism, to reduce dominant stakes in key industries such as steel making, oil and electricity supply.

The top 10 companies that would have to sell stock are state- run, accounting for about 80 percent of the total by value.

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Sensex Surges :

The Bombay Stock Exchange’s Sensitive Index, or Sensex, has climbed 61 percent this year, the eighth-best performer among 89 measures tracked by Bloomberg.

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Growth in Asia’s third-largest economy may accelerate to 7.75 percent after the government initiated stimulus plans to bolster banks’ capital and spur consumer spending, according to the finance ministry.

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International funds have bought 357.5 billion rupees of Indian stocks this year through Aug. 11, compared with record net sales of 530 billion rupees for all of 2008, according to data on the Securities and Exchange Board of India Web site.

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The government plans to boost funding for a rural jobs program by selling shares in some state-run companies.

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No Minimum :

Rules allow companies with a free-float worth at least 1 billion rupees to have as little as 10 percent traded, while there is no minimum for state-run enterprises, the ministry’s Web site says.

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The Sensex has returned 192 percent over the past five years, second in Asia only to Indonesia.

Since 2005, companies have raised 1.89 trillion rupees in share sales, including 116 billion rupees in January last year by Mumbai-based Reliance Power Ltd. that marked the country’s biggest initial public offering.

New Delhi-based DLF Ltd., India’s largest real estate developer, sold 92 billion rupees of stock in June 2007.

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Government Control :

India’s government plans to sell 8.38 percent of NMDC, the nation’s largest iron-ore producer.

The stake would fetch 120 billion rupees at current prices.

The government holds 98.4 percent in Hyderabad-based NMDC, and 85.8 percent of New Delhi-based Steel Authority of India, the nation’s second-biggest producer, according to Bloomberg data.

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“The sheer magnitude of offloading involved may result in an overhang on the secondary capital markets,” Jagannadham Thunuguntla, the head of equities at SMC Capitals Ltd. in New Delhi, said in an interview.

“The capital market may find it difficult to absorb such heavy equity” he added.

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The Securities and Exchange Board of India advocates “a phased approach, as companies may need time” to sell shares, N. Hariharan, a Mumbai-based spokesman for the market regulator, said in an e-mail Aug. 7.

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‘Phased Manner’

The proposal “should be positive for markets if introduced in a phased manner,”

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Such a change is a welcome one.

Ensuring a reasonable minimum float would help avoid share price manipulation, scams, abuse by majority shareholders, etc. This would constitute a positive structural change.

🙂

India may trigger as much as 1.9 trillion rupees ($39 billion) in stock sales, equivalent to five years of equity offerings, with a proposal to limit stakes of controlling shareholders.

Prime Minister Manmohan Singh’s government is considering a plan that would require at least 25 percent of a company’s stock to be traded. The rule would prompt equity sales in 560 of Mumbai’s 3,335 most-active stocks, such as NMDC Ltd. and Steel Authority of India Ltd., according to data compiled by Bloomberg.

The changes may encourage foreign investment by bringing Indian regulations in line with the U.S., U.K. and Hong Kong, said Anshul Krishan, the Mumbai-based head of Goldman Sachs Group Inc.’s India financing group. The sales, equal to about 4 percent of India’s $1 trillion stock market, probably won’t affect prices if they’re staggered over time, said Purav Jhaveri, senior investment strategist at Franklin Global Advisers.

“The 25 percent minimum would be good for the long-term Indian market,” Seth Freeman, chief executive officer of EM Capital Management LLC in San Francisco, which advises investors on emerging markets and runs the EM Capital India Gateway Fund, said in an e-mail response to questions. “There are many very attractive companies with small floats that investors would like to be able to invest in.”

The rule change would require the government, whose constitution embraces socialism, to reduce dominant stakes in key industries such as steelmaking, oil and electricity supply. The top 10 companies that would have to sell stock are state- run, accounting for about 80 percent of the total by value.

Sensex Surges

The Bombay Stock Exchange’s Sensitive Index, or Sensex, has climbed 61 percent this year, the eighth-best performer among 89 measures tracked by Bloomberg. Growth in Asia’s third-largest economy may accelerate to 7.75 percent after the government initiated stimulus plans to bolster banks’ capital and spur consumer spending, according to the finance ministry.

International funds have bought 357.5 billion rupees of Indian stocks this year through Aug. 11, compared with record net sales of 530 billion rupees for all of 2008, according to data on the Securities and Exchange Board of India Web site.

Finance Minister Pranab Mukherjee said in his July 6 budget speech that a rule requiring a public float of at least 25 percent for listed companies should be enforced uniformly, even for state-run enterprises that had been exempted. The government plans to boost funding for a rural jobs program by selling shares in some state-run companies.

No Minimum

Rules allow companies with a free-float worth at least 1 billion rupees to have as little as 10 percent traded, while there is no minimum for state-run enterprises, the ministry’s Web site says.

“The average public float in Indian listed companies is less than 15 percent,” Mukherjee said. “Deep, non-manipulable markets require larger and diversified public shareholdings.”

The Sensex has returned 192 percent over the past five years, second in Asia only to Indonesia. Since 2005, companies have raised 1.89 trillion rupees in share sales, including 116 billion rupees in January last year by Mumbai-based Reliance Power Ltd. that marked the country’s biggest initial public offering. New Delhi-based DLF Ltd., India’s largest real estate developer, sold 92 billion rupees of stock in June 2007.

Government Control

India’s government plans to sell 8.38 percent of NMDC, the nation’s largest iron-ore producer, Steel Secretary Pramod Rastogi said Aug. 5. The stake would fetch 120 billion rupees at current prices, he said. The government holds 98.4 percent in Hyderabad-based NMDC, and 85.8 percent of New Delhi-based Steel Authority of India, the nation’s second-biggest producer, according to Bloomberg data.

“The sheer magnitude of offloading involved may result in an overhang on the secondary capital markets,” Jagannadham Thunuguntla, the head of equities at SMC Capitals Ltd. in New Delhi, said in an interview. “The capital market may find it difficult to absorb such heavy equity.”

GMR Infrastructure Ltd., based in Bangalore, scrapped a $500 million international sale on June 30 as at least 40 companies announced plans to sell more than 350 billion rupees of shares, mostly to foreign institutional investors.

The Securities and Exchange Board of India advocates “a phased approach, as companies may need time” to sell shares, N. Hariharan, a Mumbai-based spokesman for the market regulator, said in an e-mail Aug. 7.

‘Phased Manner’

The proposal “should be positive for markets if introduced in a phased manner,” Franklin’s Jhaveri said in an e-mail response to questions. Franklin Templeton Investments in San Mateo, California manages $482.4 billion worldwide, including more than $3 billion in Indian stocks.

The Finance Ministry sought public comment on the plan on its Web site July 9. Singh’s administration plans to take up the issue after completing 100 days in office, Junior Finance Minister Namo Narain Meena said in a written statement to parliament in New Delhi on Aug. 4. Singh was sworn in on May 22.

The changes are important for protecting shareholders in India, said Andrew Foster, who oversees $2 billion in assets, including Indian securities, at Matthews International Capital Management LCC in San Francisco.

“Such a change is a welcome one,” Foster said in an e- mailed response to questions. “Ensuring a reasonable minimum float would help avoid share price manipulation, scams, abuse by majority shareholders, etc. So I think this would constitute a positive structural change.”

Market continues its thrust on 10/6/2009:)

Market continues its thrust

Market continues its thrust

After a spectacular opening, the key benchmark indices extended gains on sustained buying by foreign funds.

Foreign funds bought shares worth Rs. 955.31 crore on Tuesday 9 June 2009.

Indian stocks roared on expectations that ample liquidity in pipeline and a return of risk appetite will nudge India Inc corporate profits. India Inc has already raised almost Rs. 5,000 crore from three qualified institutional placements (QIPs) so far in 2009 and announced plans to raise another Rs 20,000 crore.

On the sectoral front, out of 13 Indices, all were traded in green.

Oil stocks advanced as crude oil surged towards $71 a barrel for the first time in seven months on a larger-than-expected fall in crude oil stocks and a view that falling oil demand may have bottomed.

IT stocks fell on stronger rupee.

Banking stocks gained on reports the Reserve Bank of India may standardize the way banks calculate their prime lending rates (RLRs) and bar them from lending below their respective PLRs for more transparency.

Metal stocks gained as six metals traded on the London Stock Exchange jumped 3.8% overnight.

The Market breadth, indicating the overall strength of the market, was strong.

On BSE, out of 2,717 stocks traded so far, 1,411 shares advanced while 1,241 shares declined. Nearly 65 shares are unchanged.

Major gainers from the BSE Sensex pack are

Wipro Ltd 5.96% to Rs. 449.00, along with,

Tata Power Ltd spurted 5.70% to Rs. 1,205.35,

HDFC Bank Ltd spurted 5.66% to Rs. 1,495.50,

Larsen & Toubro 4.97%% to Rs. 1,652.00,

Reliance Infrastructure Ltd by 4.76% to Rs. 1,204.00,

Sterlite Industries Ltd by 4.61% to Rs. 684.00,

ONGC Ltd by 4.30% to Rs. 1,180.00,

Hindustan Uniliver Ltd rose 3.74% to Rs. 266.00 and

Bharti Airtel Ltd 3.17% to Rs. 838.55 among others.

Losers from the BSE Sensex Pack are

DLF Ltd plunged 0.98% to Rs. 398.75 along with

Tata Motors Ltd fell 0.68% to Rs. 366.00,

State Bank of India 0.41% to Rs. 1,756..00 and

Sun Pharmaceuticals Ltd by 0.36% to Rs. 1,331.00 among others.