TREND FOR 1st AUGUST

Markets continue to tread in negative zone & are below 5 & 10 EMA, thus the NIFTY may drift down to 5417 & on the upside may move up to 5530. Though long positions should be avoided till the markets provide trend reversal signal, compulsive traders can take positions in APIL for a target of 617, ULTRACEMCO for a target of 1100, SYNDIBANK for a target of 125, INFOTECENT for a target of 147, AIAENG for a target of 402.
                                                       CHEERS !!!

WEEKLY WRAP

An eventful week ended on a steady note. RBI’s 50 bps rate
hike stunned one and all. The central bank policymakers also
maintained a hawkish tone. So, more tightening is likely in the
coming months, especially if infl ation remains stubborn.
A raft of results also kept market players busy. Some hit the
bull’s eye others missed the target. FII fl ows have turned choppy
and monsoon too is erratic. The US debt issue dominated world
markets and will be in focus early next week.
For India all eyes will be on the monsoon session of parliament. The
Government has promised to table a spate of key bills. It remains
to be seen how many of them are cleared by the parliament. A few
companies are yet to come out with their earnings.
Being the fi rst week of the month, Indian markets will also react to
auto sales, trade data and PMI reports. Lots of global data points
will also be on investors’ radar aside from policy meeting of central
banks in Japan, UK, EU and Australia.

TECHNICAL VIEW

Nifty this week reversed from its 200-DMA as well as from its
falling resistance line on the daily chart. Currently, Nifty has strong
support around a 61.8% retracement level at 5,435 on the weekly
chart. A move below the same can result into further downside
with a potential to drag the index down to 5,300 over the medium
term. Nifty needs to cement its position above 5,500 levels with
formation of higher top and higher bottom on the daily chart, before
confi rming any reversal signals.
F&O View
Banks,Infra and Metals have seen huge short rollovers amounting
to almost 35-40% of Market wide OI. Though 5300-5400 seems
to be the level where previously Nifty has bounced this will hold
crucial for this month as well. With IVs low at around 16-17% and
VIX hovering more or less around its 200 DMA of 20.98 we feel
August will be more depended on Global cues. We feel Nifty can
trade with negative bias with a range of around 5300 to 5600 for
the short term.
Base metals
MCX Base metals complex, barring lead traded moderately higher
this week, supported by weaker US dollar. However, impasse
regarding US debt ceiling talks has limited the upside in base
metals complex. Copper prices were categorically supported
by supply issues. Chile's Escondida copper mine, has declared
force majeure on copper concentrate sales amid a six-day strike.
Aluminium prices traded higher, supported by narrowing global
surplus. World demand grew at 4.8% during Jan-May 2011, as
compared with the same period last year, while supply grew at
3.1% on yoy basis. Nickel prices top performed the complex,
underpinned by due to healthy growth in world stainless steel
output and Chinese demand. Zinc prices remained suppressed,
weighed down by global supply glut. Lead prices declined due to
weakening demand in China from the automobile battery sector.
Chinese government has enforced a clampdown on various
battery manufacturing units on environmental grounds.
We remain skeptical regarding prevalent high base metal
prices, barring Aluminium and Nickel, considering that global
economic backdrop still remains gloomy. Global economic
recovery precedes spiraling commodity prices and not the
other way round. Moreover, relatively high energy prices
augment infl ationary pressures, effectively derailing the
global economic recovery. We reiterate with our view and
categorically advocate not chasing highs.
Precious metals
Precious metals continued to trade fi rm, supported by the impasse
in talks to raise the U.S. debt ceiling. Debt negotiations have moved
in a deadlock, conveying signs of a possible default. Democrats
and Republicans in Congress have wide range of differences over
plans to cut the U.S. defi cit by an estimated $915 billion over 10
years, a necessary move before the debt ceiling can be raised.
Many Republicans have opposed the bill, and all Democrats in the
House are also reported to be against it. The White House has to
reach a deal on raising the US$14.3 trillion debt ceiling and cut
spending before the August 2nd deadline or risk a default.
We continue to remain bullish on precious metals, as
uncertainty looms regarding global economic growth and debt
issues in US. Debt woes in Europe have not been resolved
yet, with a higher probability of the contagion spreading in
the region, with countries like Spain & Italy not ruled out.
Bailout to Greece has not served the purpose, with several
credit rating agencies further downgrading the country’s
junk status. Poor macroeconomic indicators across various
geographies still convey a gloomy scenario. Global economic
uncertainty affi rms that gold prices are poised to register new
highs during this calendar year.

TREND FOR 29th JULY

Markets continue to be in negative zone & are below 5 & 10 EMA, thus the Nifty is likely to slip down to 5417, where it is likely to find it's bottom & on the upside may move up to 5553. Though long positions should be avoided till the markets give a positive signal, compulsive traders can take long positions in SUNTV for a target of 380, OPTOCIRCUI for a target of 310, GRASIM for a target of 2500, DISHTV for a target of 97, BAJAJHLDING for a target of 805, ABGSHIP for a target of 396.

                                                                    CHEERS !!!

REAL MONEY

Do you know what would happen if all the depositors in a country go to withdraw their money from banks at about the same time? Well, under no intervention, the banking system will soon run out of funds and may even collapse. This is because banks keep only a part of depositors' money as cash and lend out the rest. Strange, isn't it? Well, there is one more unique feature of a modern day economy. And it has to do with the authority given to central banks. It seems they are the only entity that can print money. Thus, they have the ability to flood the system with cash as and when the need may be.

As though the economy wasn't a complex beast already. The above mentioned features certainly make it even more complicated. None more so than taking investment decisions we believe. Consider the low interest rate and a loose monetary environment for example. Here, it is very difficult to ascertain whether the excess money available in the system has come from genuine savings or because of pumping of money by the central bank which again has a multiplier effect courtesy the banking system. It turns out that on most occasions, it is the latter case that is more dominant.

However, businesses don't realise this. They borrow money and undertake projects in the hope that all the available money is real and here to stay. Steadily though, the reality begins to dawn on them. As loose monetary policy gives way to a tighter one, it occurs to them that not only the money is not there but the rates at which they previously borrowed have also become much steeper. The end result? Severe cash flow problems and even bankruptcy in cases where borrowings are on the much higher side.

This situation presents challenges for investors as well. When interest rates are low, it appears as if all the companies are doing well and growing at an impressive rate. In fact, the ones that continue to take on debt grow faster than the ones that don't as financial leverage plays it part. But once tightening happens, the wheat is certainly separated from chaff. It turns out that companies that were growing fast and taking on debt did not have real earnings after all. Their growth was a result of easy money policy by central banks rather than the one coming from some competitive advantage or productive improvements. Hence, it is very important that one avoids company loaded with debt for its earnings growth may not be real after all. A company that has a long track of growing without debt and also paying out part of it as dividends is certainly the one to look for.

TREND FOR 28th JULY

Markets continue to be in downtrend & are below 5 & 10 EMA. The nifty is likely to find it's bottom at 5500 & on the upside may move up to 5590. Long positions can be taken in TITAN for a target of 338, OPTOCIRCUI for a target of 311, MADRASCEM for a target of 102, INDUSINDBK for a target of 292, AMTEKAUTO for a target of 174, ABGSHIP for a target of 400.

                                                    CHEERS !!!

ECONOMIC SCENARIO

They say what is well begun is half done! But the same does not apply to corporate profits. An encouraging first quarter result season is certainly not indicative of good performance for the rest of the year. Nor is a sluggish start indicative of below average earnings growth by the end of the year. For cyclical and seasonal impact of sales and costs do impact the earnings on a quarterly basis. The first 2 quarters (April to September) typically tend to be muted due to monsoon and pre-festival seasons. Most sectors report better earnings growth during the last two quarters. However, cyclicality of commodity and interest costs is again something that does not have seasonal variation. The trend tends to linger for a longer period.

The first quarter of financial year 2011-12 has, however, been unusually sluggish for companies across sectors. Besides the high base effect, high input costs and poor demand had an impact on topline growth. But the pace of rise in borrowing costs is not stuff for the faint hearted. As seen in the following chart, short term borrowing rates have risen at an unusually sharp tick over the past 14 months. So much so that the call money and repo rates are now dangerously close to the 5 year and 10 year borrowing rates. This is indicative of the pain that companies are going through for short term funding needs. The bad news is we do not see the pain subsiding anytime soon! Even if expansion and growth plans are deferred to keep the debt limits conservative, working capital itself can strain companies' cash flows. The prohibitive rates have also hurt retail demand thus impacting the pricing power. 

In such a scenario we cannot blame companies for failing to meet investor expectations of quarterly profit growth. Instead it would be wise to allow the ones with resilient business models to tide over the cost pressure. As long as the long term prospects remain intact, going past the tough phase is a matter of time. Meanwhile investors could keep their growth estimates moderate and valuation estimates with sufficient margin of safety. 
These instruments led to a historic financial meltdown in 2008. So much so that they came to be called weapons of mass destruction. But the impact that the credit default swaps can have in the event of sovereign default is mind numbing. These instruments that are basically an insurance against a credit default rely heavily on the debt obligations being met. Today's chart shows the extent of exposure that credit default swaps have to sovereign debt of various developed and developing nations. A sovereign default by Italy or Spain could mean the losses on these papers going into several billion dollars. 
Most of us know George Soros as the man who broke the Bank of England. However, we don't think this as his biggest achievement. For us, the fact that he was able to compound money for his investors in the region of 20% for as long as nearly 40 years is perhaps his most significant achievement. Of course, he had Jim Rogers for company for a good part of this period. But there can hardly be any doubt that Soros is quite an astute investor himself. Sadly though, investors in Soros' hedge fund may no longer be able to benefit from his investing acumen. As per reports, the billionaire investor is ending his career as hedge fund manager and will return the money to outside investors. The decision was taken on account of new financial regulations that would have made it necessary for Soros' hedge fund to register with the SEC, the US capital market regulator. Thus, by the end of the year, curtains will come down on what has been one of the most successful investment journeys in recent times. Soros however, will continue to focus on philanthropy and on voicing his opinions on macroeconomic events. 
The grim unemployment scenario in US has prompted the government to restrict immigrants from working in the country. This includes workers from China and India. Its premise being that Americans should have the right to work first. But that is easier said than done. This is because Americans themselves lack certain requisite skills to fill some job vacancies. That is why US business leaders this week urged a Senate panel to implement immigration-law changes that would allow companies to hire more highly skilled workers. At present, grant of limited visas have driven many Indians away from the US. This is even after completing education there and having the requisite scientific and engineering skills. Indeed, US business leaders believe that the US will have more jobs and can be more competitive as a country. Especially if it makes it mandatory for non Americans to possess skills and knowledge that would be required to solve problems and create solutions for the economy. But is the Obama government listening? 


India is a land of diversities. Here we have state governments notorious for being harsh even to domestic industrialists. The Singur issue in West Bengal still remains unresolved while the Posco steel project in Orissa is on the verge of being shelved. This is a stark contrast to the state of Tamil Nadu. The state seems to be setting precedent of what investment friendly policies could do for a region. It is well on its way to become an industrial hub for Japan. The state capital Chennai is already home to 30% of Japanese firms operating in India. The interest in pulling investments is tangible as the government officials from various infrastructural segments have outlined the scope of investments. The companies from Japan have shown a fourfold growth in the last five years. The plans are underway to set up an Industrial township in Mahabalipuram - The Omega project; in a span of 10 years. Out of 1,450 acres of land requirement, 70% has already been taken care of. The rest is expected to be finalized soon. The first phase which will come up on 400 acres is expected to be ready in four to five years.

The obvious reasons for the focus on Tamil Nadu are its highly skilled manpower, proximity to South East Asian countries and the fact that it is a gateway to the West Asia, Africa and Europe. But the most crucial qualifier is investment-friendly policies. Hope that the other state governments take a leaf out of this. 
Last week, the subscribers of Bharati Airtel India's largest mobile operators, received a blow. This was in the form of higher tariffs. The company has increased its mobile rates in six of its circles. As a result the question that has popped in everyone's minds is whether this translates to higher mobile tariffs for the country? India has one of the lowest mobile rates in the world. A major factor for this has been the increased competition in the sector which led to slashing of tariffs. However, in recent times, mobile companies have seen their margins getting squeezed. The new operators still continue to bleed. As a result, the companies have indicated indicating that tariffs may have bottomed out. It was just a question of time that tariffs would start to trend upwards. By the looks of it, Bharti has taken the initiative by increasing its rates. However, others would prefer to wait and see how this would impact Bharti's subscriber addition as well as its revenues before going ahead and taking similar steps. It is a well known fact that Indian consumers are very sensitive to prices. Therefore, there are chances tha t they would not react well to a ny increase. Particularly when others continue to offer lower rates. However, if all operators follow suit, then looks like the age for low telecom tariffs has come to an end. Indian mobile rates would start to trend upwards. And the consumers would be looking at paying higher mobile bills. 

Taking off with the negative sentiments seen after the RBI rate hike yesterday, profit booking in banking, power and capital goods heavyweights, led the benchmark indices in the Indian Stock market to languish in the red. At the time of writing, the BSE Sensex was trading lower by 89 points. Other major Asian indices also closed lower. Europe has also opened on a negative note.

TREND FOR 27th JULY

As expected the RBI raised the Repo & Reverse repo rates & the markets dutifully plunged in negative territory, thus the Nifty may now slip to 5526 - 5500 & on the upside may move up to 5606. Long positions should be avoided till the markets digests the rate hike, however compulsive traders can take long positions in BAJAJHLDING for a target of 775, GIPCL for a target of 89, WIPRO for a target of 454, JSWSTEEL for a target of 900, STAR for a target of 410, IPCALAB for a target of 352.
                                                                       CHEERS !!!

POLICY MATTERS

That the RBI is not yet done with liquidity tightening was well anticipated. The first monetary policy for financial year 2011-12 was therefore expected to make borrowing costs dearer. But another 0.5% hike in repo and reverse repo rates today do not just make the rate steep. They feature India amongst the emerging economies where leverage is a huge deterrent for companies and individuals. This certainly is not all bad news in a scenario where excess debt has caused economies to go bankrupt. Or has led to even the likes of the US to consider a debt default. However, the prohibitive rates will certainly ensure that the RBI's downward revisions of GDP and credit growth become a reality. In fact we will not be surprised if more such downward revisions follow.

The latest hikes put the repo and reverse repo rates at 8% and 9% respectively. This is while the 10 year GSec yield is at 8.2% and 5 year AAA bond yield is 9.6%. Thus, the gap between short and long term borrowing rates has narrowed considerably over the past 2 years. 
There is no doubt in anyone's mind that the Eurozone is indeed facing some very serious challenges. And it is doing whatever it can to tide over the same. One particular action that has caused quite a bit of stir has to do with ratings agencies. Apparently, their independence has been restricted by some of the European policymakers. And quite expectedly, it has not gone down well with ratings agencies. In an editorial in FT, Deven Sharma, the President of S&P, one of the world's premier ratings agencies, has argued that such a step is likely to prove counterproductive. To criticise ratings firms for creating or deepening Eurozone's problems is to confuse symptoms with causes, he is believed to have said. A better approach, according to him, would be to avoid making ratings the sole criteria for policy decisions. While we are no fans of ratings agencies, we believe Mr Sharma could well be right here. Problems of Eurozone are of their own making. And to blame ratings age ncies for the same is indeed taking it a bit too far. Trusting ratings agencies blindly is not the solution either as the subprime crisis has shown. At best, it can be considered as an opinion and the investors would be well advised to do their own independent research. 
Copper prices witnessed happy times till last year. This was on the back of the huge demand from China. However, in recent times, prices have corrected sharply. This was again thanks to China as fears of slowdown started to hit the prices of most commodities. Considering the fact that China consumes nearly 40% of the global copper, it is little wonder that the prices of the red metal are determined by the fortunes of the country. But one wonders as to where copper is headed. Considering the fact that copper is mostly used in the construction industry, it appears that its prices would continue to trend upwards. The reason for this is that despite the slowdown in China, construction activity in the country is still quite high. Though it has slowed down in bigger cities, however, it still continues to be strong in the smaller provinces. In fact China has largely been drawing down on its existing copper inventories. This is the reason why the demand has not reflected in th e prices. But once the inventory is finished, it would come back to the markets to buy more. And that would send the prices of the metal back up. 
Traders appear to be optimistic on oil prices. The biggest bet now stands at US$ 120 per barrel for oil. This is on premise that growth in emerging markets will outweigh the debt crisis in Europe, slowdown in the US and extra supplies from Saudi Arabia. The IEA has gone back (retreated) on its promise to release more oil from its stockpiles. And that has been well captured by option markets that now indicate higher chances of rise in oil prices. While we believe the price to remain high in the near term, the level of US$120 a barrel seems stretched. We should not forget that the triggers which pulled down oil price prospects in April are not off yet. Infact, they are only gaining more momentum. The US seems to be at the brink of a financial calamity on account of debt limits with the decision makers still a long way from any deal and deadline just a week away. The Eurozone debt concerns continue to fester. And the main point on which they are placing their bullish bets, the much expected overriding growth in Asian economy, remains shadowed by policies to curb inflation. Last but not the least, any surge in oil prices will pull down the global economic growth feeding a negative for oil price itself. 
Time seems to be running out for the US as the Congress still has not reached common grounds on the issue of raising the debt ceiling. As per President Obama, a default by US would be catastrophic and could push the country into a second depression. However, the American corporations don't seem to be doing so bad. As per Wall Street Journal, earning at companies in the S&P 500 are the highest they have been in the last four years. All but a quarter of the companies listed on the index have outperformed analysts' predictions. While this is great news for investors, it is not so for American job seekers. This is because the gains which these corporates have shown come mainly from international markets. Naturally, American corporates would look to expand their operations in these markets, backed by hiring of overseas workers.

Manufacturing had been the driving force behind America's Industrial revolution. But with the shifting of manufacturing out of the country, new jobs will not be created. What is more, President Obama's Quantitative Easing (QE) programmes, have certainly had no impact whatsoever in reducing the persistently high unemployment rate in the country. 


Markets are trading weak post announcement of 50 basis points rate hike by RBI today. At the time of writing, the benchmark BSE Sensex was down by 282 points (1.5%). All sectoral indices were trading in the red led by realty and banking stocks. The Asian markets are all trading firm with Taiwan and Hong Kong leading the pack of gainers. 

TREND FOR 26th JULY

Markets continued it's forward march today & are in upbeat mode & technically strong, but much will depend on tomorrow's credit policy statement of RBI. Thus the Nifty is likely to make dash for 5751 & on the downside may slip to 5620. Long positions can be taken in INDHOTEL for a target of 88, MAX for a target of 191, MLL for a target of 44, NMDC for a target of 300, RPOWER for a target of 130, TATAMOTORS for a target of 1100, THERMAX for a target of 680.
                                              CHEERS !!!

FLAT START

The Indian equity markets have made a flat-to-negative start as investors remained cautious ahead of the RBI's quarterly monetary policy review, where it is widely being expected that the central bank will go for another rate hike of 25 basis points. The global cues too remained unsupportive as the US markets made a mixed closing on Friday while, all the Asian counterparts were trading in the negative terrain at this point of time, indicating somber investors' sentiment. Back home, on the sectoral front consumer durables witnessed the maximum gain in trade followed by oil and gas and auto while, fast moving consumer goods, software and realty remained the top losers on the BSE sectoral space. Meanwhile, retail shares like Pantaloon Retail, Cantabil Retail, Brand House retail, Vishal Retail, Shoppers Stop all were trading higher in the trade after the committee of secretaries recommended 51 percent Foreign Direct Investment (FDI) in multi-brand retail on Friday. The secretaries' decision stills need a cabinet approval, moreover, index heavyweight Reliance Industries was trading with a gain of over a percent after the government on Friday gave unconditional approval to RIL's proposal to sell 30 per cent interest in 21 oil and gas blocks to BP. The broader indices were outperforming benchmarks. The market breadth on the BSE was positive; there were 1,244 shares on the gaining side against 607 shares on the losing side while 88 shares remained unchanged.
The BSE Sensex opened at 18,753.35; about 31 points lower compared to its previous closing of 18,722.30, and has touched a low of 18,670.84 while high remained its opening.
The index is currently trading at 18,708.23, down by 14.07 points or 0.08%. There were 10 stocks advancing against 20 declines on the index.
The overall market breadth has made a strong start with 64.16% stocks advancing against 31.30% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices rose 0.40% and 0.59% respectively.
The top gaining sectoral indices on the BSE were, CD up by 0.76%, Oil and Gas up by 0.72%, Auto up by 0.47%, CG up by 0.35% and HC was up by 0.15%. While, FMCG down by 0.82%, IT down by 0.72%, Realty down by 0.30%, Banking down by 0.18% and PSU down by 0.05% were the top losers on the index.
The top gainers on the Sensex were RCom up by 2.52%, Bharti Airtel up by 1.74%, M&M up by 1.18%, Sterlite Industries up by 1.17% and Reliance Infra was up by 1.25%.
On the flip side, ITC was down by 1.21%, Infosys was down by 1.07%, Jaiprakash Associates was down by 0.80%, ONGC was down by 0.73% and TCS was down by 0.68% were the top losers on the Sensex.
Meanwhile, during the first quarter of current financial year, exports from Special Economic Zones increased by 23%, the total exports from 143 operational SEZs stood at Rs 72, 255 crore.  However, the growth in exports is slower than the aggregate exports from the country in the April to June 2011.  
The growth of shipments from outside SEZs was more than 40%, as the exporters wanted to get the benefits from the Duty Drawback Entitlement (DEPB) Scheme, which is ending on September 30, 2011.Under the DEPB scheme, exporters get refunds of tax rates on the imports of their export products.
As per the data released by Export Promotion Council for EOUs and SEZs (EPCES), during last financial year, exports from SEZs increased by 43% to Rs 3.15 lakh crore compared to Rs 2.2 lakh in the 2009-10. 
Till June, the SEZs provide employment to 7.14 lakh workers and it also attracted investment worth around Rs 2.12 crore. The leading exports from SEZs are IT, IT-hardware, petroleum, engineering, leather and garments. Under the SEZ act of 2005, SEZs get number of incentives for investment and exports, and units also gets number of tax incentives also. Under the SEZ act, SEZ units get 100% tax exemption on profits made by exports for the first five years, 50% of tax exemption for other five years, and another 50% of tax exemption on reinvestment of profits in the coming five years.  
Due to number of incentives on tax and exports, many developers applied for the SEZ projects as they saw investment in SEZ as an opportunity in real estate. However, developers are worried over the recommendation by finance ministry for phasing out the tax incentives for units starting after the 2014. Developers are also worried over the imposition of Minimum Alternate Tax (MAT) of 18.5% on the book profits of SEZ developers and units within. Additionally, protests from farmers for land acquisition also have delayed many projects.
The S&P CNX Nifty opened at 5,633.80; flat compared to its previous closing of 5,633.95, and has touched a high and a low of 5,635.90 and 5,616.70 respectively.
The index is currently trading at 5,629.65, higher by 4.30 points or 0.08%. There were 23 stocks advancing against 27 declines on the index.
The top gainers of the Nifty were RCom up by 3.47%, Bharti Airtel up by 2.26%, Axis Bank up by 1.99%, RIL up by 1.22% and Sterlite Industries up by 1.21%.
On the flip side, ITC down by 1.23%, Kotak Bank down by 1.14%, Infosys down by 1.13%, HDFC down by 0.87% and HUL down by 0.87%, were the major losers on the index.

All the Asian equity indices were trading in the red; Shanghai Composite was down 58.19 points or 2.10% to 2,712.60, Hang Seng was down 176.52 points or 0.79% to 22,268.28, Jakarta Composite was down 26.82 points or 0.65% to 4,080.00, KLSE Composite was down 3.51 points or 0.22% to 1,561.55, Nikkei 225 was down 79.92 points or 0.79% to 10,052.19, Straits Times was down 28.80 points or 0.90% to 3,154.15, Seoul Composite was down 17.24 points or 0.79% to 2,153.99 and Taiwan Weighted was down by 74.06 points or 0.84% to 8,691.26

TREND FOR 25th JULY

Markets today gave a spirited performance on the back of strong global cues & has again entered in positive zone, thus the Nifty tomorrow is likely to move up to 5658 & on the downside may drift to 5590. Long positions can be taken in M & M for a target of 780, BHUSHANSTL for a target of 520, ESCORTS for a target of 144, GESHIP for a target of 305, IDBI for a target of 154, POLARIS for a target of 212, RPOWER for a target of 131, SOBHA for a target of 310.

                                                               CHEERS !!!

MARKETS CONTINUE TO SPARKLE

Indian stock markets continued their northbound journey in the afternoon session of trade as sanguine investors relentlessly piled up hefty positions in the heavyweight stocks. The fact that there was no laggard in the fifty stock Nifty index itself shows the optimism among the market participants. In the meantime, the frontline indices have also gone on to erase the week's losses and are expected to resume the weekly uptrend, after suffering around one and half a percent loss last week. On the global front, the European markets began their day on an encouraging note after the European Union leaders carved out a second bailout package worth 109 billion euros ($157 billion) for debt-stricken Greece in a desperate effort to contain the 18-month-long debt crisis in the single-currency bloc of 17 nations. Back home, the information technology counter witnessed hefty position build up as uncertainty over earnings of software exporting companies reduced on expectations that Europe's debt crisis will not spread. The surge of around one and half a percent in index heavyweight Reliance Industries too buttressed the benchmarks. However, the only chink in the armor on the BSE sectoral space was Consumer Durables counter which languished in the negative territory with around a percent loss. Meanwhile, the broader markets too are trading with strong gains but are being outclassed by the larger peers by quite a margin. The bourses consolidated on good volumes as the turnover for the market already has surged over a lakh crore for the session while the market breadth on BSE was in favor of advances in the ratio of 1655:946 while 130 scrips remained unchanged.
The BSE Sensex is currently trading at 18,702.41 up by 266.22 points or 1.44% after trading as high as 18,724.71 and as low as 18,533.43. There were 29 stocks advancing against 1 decline on the index.
The broader indices were trading on a strong note; the BSE Mid cap index surged 0.99% and Small cap climbed by 0.71% respectively. 
On the BSE sectoral space, Teck up 1.59%, IT up 1.51%, Oil & Gas up 1.47%, Capital Goods up 1.46% and Bankex up 1.38% were the major gainers, while Consumer Durables down 1.03% was the only loser on the index.
The top gainers on the Sensex were Bharti Airtel up by 2.54%, Tata Power up by 2.25%, Tata Motors up by 2.20%, HDFC up 1.79% and Infosys up 1.76%.
On the flip side, DLF down by 0.39% was the only losers on the index.
The Union Government is expected to allow additional export of 8 lakh bales of cotton, of the 8 lakh bales, 3 lakh bales are expected to be reserved for the Cotton Corporation of India and the rest 5 lakh bales would be lifted from private players. In order to control the domestic prices which are contributing to inflation, government is going slow on exports.
Cotton Association of India president Dhiren Sheth said, 'Prices will keep falling if further exports are now allowed. We are pushing for completely free export through open general license without quantitative restriction. International prices are stable and give Indian exporters an edge." Last month, government had allowed the export of 10 lakh bales as compared to upper limit of 55 Bales for present season (October 2010 to September 2011). But the exporters are demanding additional exports of 10 to 20 lakh bales in the coming months.   All India Ginners Association president Bharat Vala said, 'Only after the Cotton Association Board meeting scheduled on July 25, one would be able to know how many unsold bales are in the market and what the revised estimated crop size is. On the basis of this report, we expect the Group of Ministers meeting headed by Finance Minister Pranab Mukherjee to decide the quantity of export.'
In the meantime, Tirupur Exporters Association president A Sakthivel said that the industry has lost Rs 1,000 crore in apparel exports per quarter owing to the closure of over 730 bleaching and dying units in the textile hub. After the order of Madras High Court, from January these bleaching and dying units have been closed for polluting water bodies.   
'Over one lakh workers both directly and indirectly employed by the apparel industry are jobless. About 70% of the industries are outsourcing the job work to Ludhiana, Ahmedabad, Mysore, Kolkata and Mumbai but we still predict a production and export loss of 30% to 35%.' Sakthivel said whereas adding further he said that yarn worth Rs 700 crore has been lying unused in spinning mills with garment manufacturers reducing their manufacturing capacities.
The price of cotton have been reduced significantly, cotton yarn prices of 40 count yarn were reduced to Rs 160 per kg from Rs 274 in February 2011.

The S&P CNX Nifty is currently trading at 5,625.75, higher by 84.15 points or 1.52% after trading as high as 5,629.45 and as low as 5,567.10. There were 50 stocks advancing against 0 declines on the index.

The top gainers of the Nifty were Ambuja Cement up by 3.01%, Bahrti Airtel up by 2.89%, Tata Power up by 2.72%, Grasim up by 2.42% and M&M up by 2.37%, while there were no losers on the index.
Asian markets are exhibiting optimistic trends as Shanghai Composite inched up 0.05%, Hang Seng rallied 1.66%, Jakarta Composite gained 0.50%, Nikkei 225 surged by 1.22%, Straits Times soared 1.06%, Seoul Composite jumped 1.22% and Taiwan Weighted climbed by 0.55%.
On the other hand, KLSE Composite slipped by 0.12%.
The European markets have opened on a optimistic note as France's CAC 40 gained 0.70%, Germany's DAX rose 0.46% and London's FTSE added 0.63%

MOOD REMAINS UPBEAT

The Indian equity markets are trading upbeat with big gains on the back of consistent buying in all major heavyweights. Sensex rallied by 250 points and benchmark Nifty moved over the 5,600-mark led by further buying in all major sectors post strong global cues. All 30 members of the Sensex pack firmed up in late morning session apart from DLF. On the sectoral front, all sectors were performing well with buying support except consumer durable.  Several stocks from TECk, IT, oil & gas, banking sectors too posted strong gains. On the global front, most of the Asian markets were trading in positive territory on approval of $157 billion bailout package (second) for Greece by European Union yesterday and reports of likely debt deal from White House and Republicans. The key benchmark indices in China, Hong Kong, Japan, South Korea and Taiwan rose between 0.45% and 1.70%. Back home, the market breadth is also positive; there were 1,662 shares on the gaining side against 803 shares on the losing side while 110 shares remained unchanged.
The BSE Sensex is currently trading at 18,714.33, up by 278.14 points or 1.51%. The index has touched a high and low of 18,724.71 and 18,533.43 respectively. There were 29 stocks advancing against just 1 decline on the index.
The broader indices also trading positive; the BSE Mid cap and Small cap indices were up by 1.05% and 0.80% respectively.
The top gaining sectoral indices on the BSE were, TECk up by 1.66%, IT up by 1.62%, Oil & Gas up by 1.46%, Bankex up by 1.38% and CG up by 1.38%. While, CD down by 0.53% was the lone loser on the index.
The top gainers on the Sensex were Bharti Airtel up by 2.67%, Tata Power up by 2.56%, Tata Motors up by 2.28%, HDFC up by 2.06% and Infosys up by 2.01%. On the flip side, DLF down by 0.31% was the lone loser on the Sensex.
Meanwhile, Iran issued a new warning that it will halt crude oil supplies to India from August unless a mechanism is found to clear past dues. Since December, India and Iran have struggled to find ways for New Delhi to pay for imports of 400,000 barrels per day or 12 percent of its oil demand after the Reserve Bank of India halted a clearing mechanism under US pressure.
Petroleum Minister S Jaipal Reddy on July 21 said, India is ready with backup plan to cope with a halt to supplies of crude Iran by adding further, he said, there will not be any oil shortage due to Iran halting supplies in August.  

However, petroleum minister did not share the details over the backup plans to increase the supply from alternate source to fill the gap arising because of Iranian halt. The halt from Iran can have significant impact on Asia's third largest economy's energy supply, as Iran supplies around 4 lakh barrels a day or 12 percent of India's total crude oil supply.

As an alternate solution India is looking to increase its supply of crude oil from other suppliers such as Saudi Arabia and United Arab Emirates.  Earlier this month, Iran had warned India, it will stop its oil supply to India if there is no solution on the payment problem. However, to protect its market share Iran had maintained its oil supply to India for seven months without payment, as India is the second largest buyer of Iranian crude oil price after China. 
The S&P CNX Nifty is currently trading at 5,623.20, up by 81.60 points or 1.47%. The index has touched a high and low of 5,628.45 and 5,567.10 respectively. There were 49 stocks advancing against just 1 decline on the index.
The top gainers of the Nifty were Ambuja Cement up by 2.97%, Tata Power up by 2.92%, Bharti Airtel up by 2.76%, IDFC up by 2.22% and Tata Motors up by 2.14%. While Sesa Goa down by 0.07% was the lone loser on the index.
All the Asian equity indices barring KLSE Composite, which was down by 0.17%, were trading in the green; Shanghai Composite gained 0.42%, Hang Seng surged 1.76%, Jakarta Composite added 0.50%, Nikkei 225 spurted by 1.14%, Straits Times rose 0.96%, Seoul Composite jumped up by 1.11% and Taiwan Weighted was up by 0.55%

SUBSTANTIAL GAINS

Erasing the weekly losses, local bourses have added some more points to their kitty after European leaders agreed on aid for Greece, thereby easing concerns the region's debt crisis may spread and threaten global growth. Buying across the board has sent the benchmark indices sparkling above their respective psychological level of 18600 (Sensex) and 5600 (Nifty). On the global front, U.S. stocks climbed on Thursday as signs of progress on the U.S. debt talks and concrete action from Europe on its own debt crisis heartened investors. Meanwhile, Asian shares rose on Friday after euro zone leaders finally struck a bailout deal for Greece. The US future indices are showing an uptick in the screen trade. Back home on the BSE Sectoral front, stocks from TECk, Information Technology and Oil & Gas counters were sparkling with gains, while stocks from Consumer Durable space remained the lone loser. The 30 scrip sensitive index - Sensex - gaining over 200 points was comfortably trading above its 18600 level, while the 50 share index - Nifty - was trading above its 5600 mark. The broader indices too enticed some more gains. The overall market breadth on BSE was in the favour of advances which thumped declines in the ratio of 1598:772, while 95 shares remained unchanged.
The BSE Sensex is currently trading at 18,678.58 up by 242.39 points or 1.31% from its previous close of 18,436.19.The index has touched a high and low of 18,708.70 and 18,533.43 respectively. All the 30 stock were on advancing on the index.
The broader indices too captured substantial gains; BSE Midcap and Small Indices were trading up by 0.99% and 0.67% respectively.
On the BSE sectoral space, TECk up 1.45% IT up by 1.38%, Oil & Gas up by 1.29%, Power up by 1.24% and Bankex up by 1.17% were the top gainers, while Consumer Durables down by 0.53% was the loner loser on the index.
The top gainers on the Sensex were Bharti Airtel up by 2.53%, Tata Power up by 2.48%, Tata Motors up by 2.15%, HDFC Bank up by 1.76% and Infosys up by 1.69%
Meanwhile, the Shipping Ministry is planning to raise around Rs 2,100 crore by September from the capital market by way of issuing tax free bonds. The country's only corporate port, Ennore Port will raise Rs 1,100 crore whereas JNPT has been given the nod to raise about Rs 1,000 crore. The coupon rate will be decided after receiving approval from the finance ministry.
'A letter has been sent to the finance ministry and we expect the notification to come from Central Board of Direct Taxes shortly,' a senior official from the shipping ministry said. By adding further he said, the two ports have been given a go ahead first as they have a credit rating in place. A better credit rating facilitates in raising funds from the market at a lower borrowing cost.
The pricing of bonds would depend on the rating of ports, a good rating indicates less risk and therefore making it attractive for the investors. Experts are of the view that tax free bonds are good option for financing the infrastructure projects
In the Union budget for current financial, government had allowed issue of Rs 30,000 crore tax free bonds for infrastructure development, out of which Rs 5,000 crore has been allocated for port sector. This will be the first time when Indian ports would be raising funds from tax free bonds.
The balance Rs 3,000 crore will be raised by the end of the calendar year through Indian Ports Global , a state-owned company which will be set up on the lines of Dubai's DP World and Singapore's PSA International Pte to invest in overseas ports and terminals. The money raised will be used to finance the dredging operations and infrastructure requirements of various major ports.
 The S&P CNX Nifty is currently trading at 5,619.75, higher by 78.15 points or 1.41%. The index has touched a high and low of 5,620.90 and 5,567.10 respectively.  All the 50 stocks were advancing on the index.

The NSE CNX Midcap and CNX Nifty Junior indices were up by 1.18% and 0.93% respectively.

The top gaining sectoral indices on the NSE were, CNX Infra up by 1.62%, CNX Service up by 1.55%, CNX IT up by 1.47%, CNX Energy up by 1.44% and Bank Nifty up by 1.39%.
The top gainers of the Nifty were IDFC up by 2.59%, Ambuja Cement up by 2.57%, Tata Power up by 2.39%, Bharti Airtel up by 2.15% and Tata Motors up by 1.98%.
All the Asian equity indices barring KLSE Composite, which was down by 0.17%, were trading in the green; Shanghai Composite gained 0.51%, Hang Seng surged 1.69%, Jakarta Composite added 0.50%, Nikkei 225 spurted by 1.27%, Straits Times rose 0.99%, Seoul Composite jumped up by 1.04% and Taiwan Weighted was up by 0.59%

FIRM MARKETS

The Indian equity markets are trading firm after making a positive start tracking positive cues from global equity indices. The US markets made a good bounce back overnight on sign that European leaders are getting closer to agreeing on a broad approach to dealing with the region's debt troubles while; all the Asian markets barring KLSE Composite were trading in the positive terrain at this point of time, indicating strong investors' sentiment. Back home, sustained buying in mostly all the key heavyweights along with broader indices supported BSE's -- Sensex -- and NSE's -- Nifty -- to trade comfortably over their crucial 18,500 and 5,550 mark respectively. On the sectoral front, software witnessed the maximum gain in trade followed by pharma and energy, while there were no losers on the NSE sectoral space. Meanwhile, textile stocks viz., Alok Industries, Vardhman Textile and Grasim Industries all were trading with a gain in the range of 0.50-1.50 percent on the buzz that the government is mulling to allow an export of 8 lakh more bales of cotton. The government had on June 8 allowed the export of 10 lakh bales of 170 kg each beyond the earlier ceiling of 55 lakh bales for the current cotton season (October 2010-September 2011). The broader indices on the NSE were outperforming benchmarks. The market breadth on the NSE was positive; there were 860 shares on the gaining side against 284 shares on the losing side.
The index is currently trading at 18,546.16, up by 109.97 points or 0.59%. Due to some technical issues the BSE data were not getting updated.
Meanwhile, to meet the growing demand of energy, India is considering creating a sovereign wealth fund (SWF) with above $10 billion, from its foreign-exchange reserves to buy energy assets overseas. Though the plan of creating country's first SWF is still in its early stage but has started facing headwinds as the Reserve Bank of India had raised its concern over using foreign exchange reserves for SWF.  
India's energy demand is increasing with the economic growth and development, and as the traditional source of energy is expected to shrink in future, the unconventional energy sources like shale gas, coal-bed methane and oil sands are attracting attention of fastest growing countries like China and India. In recent time, China has outpaced India in race to acquire oil and coal blocks in different parts of world, to meet its growing demand for the energy. The petroleum ministry had suggested setting up such mechanism in order to secure country's energy supply against the growing demand.
However, Reserve Bank of India is not in a favor of using foreign reserves for financing the SEF, as the reserves are used for financing country's Current Account Deficit (CAD). During 2010-11, India's CAD was 2.6% of Gross Domestic Product and in the first week of July, country's foreign exchange reserves stood at more than $314 billion as on July 8.
The deputy Chairman of Planning Commission, Montek Singh Ahluwalia said 'There is a group which is examining this but no decision has been taken.' The original size of the fund was $10 billion but since commodity prices have increased, the size of fund, if approved could be higher.

However, the government is considering other option and can put aside funds for SWF from budget. But government is less likely to fund SWF through budgetary allocations as it may find it difficult in current fiscal year and in coming year government is expected to spend on populist schemes as there in elections in Utter Pradesh and Gujarat.

The S&P CNX Nifty opened at 5,576.95; about 35 points higher compared to its previous closing of 5,541.60, and has touched a high and a low of 5,585.35 and 5,567.10 respectively.
The index is currently trading at 5,470.55, higher by 28.95 points or 0.52%. There were 47 stocks advancing against just 3 declines on the index.
The overall market breadth has made a strong start with 860 stocks advancing against 284 declines. The broader indices on the NSE were out performing benchmarks. The NSE CNX Midcap and CNX Nifty Junior indices surged 0.80% and 0.66% respectively 
The top gaining sectoral indices on the NSE were, CNX IT up by 0.78%, CNX Pharma up by 0.76%, CNX Energy up by 0.72%, CNX Services up by 0.69% and Bank Nifty was up by 0.69%. While, there were no losers on the index.
The top gainers of the Nifty were Ambuja Cement up by 1.70%, Tata Power up by 1.49%, Dr Reddy up by 1.03%, GAIL up by 0.89% and NTPC up by 0.85%.
On the flip side, Jindal Steel down by 0.23%, Cairn down by 0.09% and ITC down by 0.07%, were the only losers on the index.
All the Asian equity indices barring KLSE Composite were trading in the green; Shanghai Composite was up 12.50 points or 0.45% to 2,778.40, Hang Seng was up 370.76 points or 1.69% to 22,358.05, Jakarta Composite was up 20.33 points or 0.50% to 4,088.40, Nikkei 225 was up 113.47 points or 1.13% t o10,123.86, Straits Times was up 31.50 points or 1.00% to 3,170.01, Seoul Composite was up 18.82 points or 0.88% to 2,163.86 and Taiwan Weighted was up 62.02 points or 0.71% to 8,779.16.
On the flip side, KLSE Composite was down by 2.65 points or 0.17% to 1,563.16.

TREND FOR 22nd JULY

Markets continue to drift lower in spit of the lower inflation, RBI rate hike fears being most on the mind, & thus the Nifty is likely to drift to 5500 - 5470 & on the upside may move to 5580 - 5658, though technically most of the stocks are showing negative structure, long positions can be taken in ZEEL for a target of 146, NMDC for a target of 300, MINDTREE for a target of 430, DCHL for a target of 90, BAJAJHLDNG for a target of 809.

                                                                 CHEERS !!!

MARKETS CONTINUE TO BE IN RED

Indian stock markets appear completely undeterred by the weekly inflation numbers announced by the commerce ministry which showed that Food Inflation for the week ending June 9 fell to 7.58% from 8.31% on a week-on-week basis. Investors continued to stay at bay on expectations that RBI may hike its key policy interest rates by a further 25 basis points next week, which will mark its 11th hike since March 2010. The central bank is expected to hike rate once more by the end of the year, before pausing its policy tightening measures to rein in the inflationary pressure on the economy. On the global front, the European stock markets have got off to a smart start as all major indices climbed over half a percent point on hopes that European leaders will be able to reach an agreement on a second bailout for Greece when they meet later in the day. Meanwhile, all Asian peers have clawed back into the green terrain, barring the Chinese benchmark which plunged after reports showed that preliminary HSBC PMI for China fell to a 28-month low of 48.9 in July from a final reading of 50.1 in June. Back home, the benchmark indices traded around their previous closing levels of 5,550 and 18,500 levels. On the sectoral front, the information technology and FMCG shares gained some traction. However, the rate sensitive Automobile, bankex and realty pockets bore the brunt of selling pressure.
Meanwhile, the broader markets too are trading on a weak note lacking any fervor to climb to high levels. The bourses consolidated on weak volumes while the market breadth on BSE was in favor of declines in the ratio of 1240:1338 while 109 scrips remained unchanged.
The BSE Sensex is currently trading at 18,500.36 down by 2.02 points or 0.01% after trading as high as 18,566.99 and as low as 18,419.98. There were 14 stocks advancing against 16 declines on the index.
The broader indices were trading on a weak note; the BSE Mid cap index fell 0.22% and Small cap eased by 0.04% respectively. 
On the BSE sectoral space, IT up 0.41%, FMCG up 0.31%, Tech up 0.20%, PSU up 0.07% and Capital Goods up 0.02% were the only gainers, while Consumer Durables down 1.22%, Realty down 0.83%, Healthcare down 0.76%, Bankex down 0.50% and Metal down 0.32% were the major losers on the index.
The top gainers on the Sensex were HUL up by 1.03%, Tata Motors up by 0.97%, Infosys up by 0.88%, ONGC up 0.69% and Wipro up 0.65%.
On the flip side, R Com down by 1.54%, BHEL down 1.14%, Hero Honda down 1.02%, Hindalco down 0.98% and RIL down by 0.73% were the major losers on the index.
Commerce and Industry Minister Anand Sharma will meet the new Environment Minister Jayanthi Natarajan today to discuss the proposed manufacturing policy and industry concerns on green clearances for projects.
Many mega industrial projects from, infrastructure, constructions, power and mining projects like Posco in Orissa and Lavasa in Pune have been delayed due to environment related issues.  The draft new manufacturing policy which aims to attract foreign investment and increasing share of manufacturing sector to in the country's Gross Domestic Production (GDP), has been stuck because of inter-ministerial differences on the issues like labour and environment.
The draft manufacturing policy suggests that industries in National Manufacturing Investment Zones (NMIZs) - big enclaves which could even subsume special economic zones - should be given flexibilities to downsize labour. Likewise, it recommends changes in the environment norms which come in the way of investment.
Earlier, the Department of Industrial Policy and Promotion (DIPP) had issued a concept paper for setting up NMIZs, which are being planned as mega industrial cities with the entire infrastructure. Government is aiming to increase the share of manufacturing sector from 16% to 25% of GDP by 2025. The policy also targets to generate 100 million jobs. 

The S&P CNX Nifty is currently trading at 5,551.70, lower by 15.35 points or 0.28% after trading as high as 5,578.90 and as low as 5,536.25. There were 16 stocks advancing against 34 declines on the index.

The top gainers of the Nifty were Siemens up by 1.31%, Tata Motors up by 0.94%, Infosys up by 0.80%, HCL up by 0.77% and HUL up by 0.77%.
Sesa Goa down by 2.73%, IDFC down 2.64%, Kotak Bank down 2.25%, R Com down 1.91% and Axis Bank down 1.81% were the major losers on the index.
Asian markets are exhibiting mixed trends as Hang Seng added 0.03%,Jakarta Composite gained 0.32%, KLSE Composite inched up 0.05%, Nikkei 225 rose marginally by 0.04%, Straits Times gained 0.29% and Taiwan Weighted increased by 0.13%.
On the other hand, Shanghai Composite slipped by 0.94% and Seoul Composite declined 0.46%.

The European markets have opened on a optimistic note as France's CAC 40 gained 0.69%, Germany's DAX rose 0.63% and London's FTSE added 0.35%

SLUGGISH MARKETS

Mirroring daunting global leads, local bourses after slipping in early trade and then crawling back into green, have once again peeled off most of its gains ahead of the weekly food Inflation data. Investor's apprehensions over quarterly earnings coupled with the fears of hike in interest rates to tame inflation have mainly activated the bears into the market as investors lacking conviction over the momentum are cautious enough of building heft position and are pressing sales over every small rise. Investor's sentiment was also dented after government yesterday lowered its GDP growth projection for 2011-12 to 8.6 per cent from about 9 per cent and added that inflation, currently hovering above 9 per cent, would continue to remain high till December. However, the market is expected to recover later in the day as a deal between France and Germany over a bailout of Greece raised hopes ahead of a major European summit. On the global front, U.S. stocks closed nearly unchanged on Wednesday, a day after Wall Street's best rally since March, as the oncoming debt ceiling deadline overshadowed strong earnings from Apple Inc. Meanwhile, the Asian indices too dropped for the first time in three days, on concern that factory output in China may have contracted in July and as companies from Hynix Semiconductor and Hyundai Heavy Industries posted lower earnings. The US future indices were trading mixed in the screen trade.
Back home, stocks from Fast Moving Consumer Goods, Information Technology and Public Sector Undertaking counters were toiling to keep the benchmarks in green, while stocks from Consumer Durable, Realty and Healthcare space were among the prominent losers, dragging the markets lower. The benchmark indices are trading mixed at this point of time, as the 30 scrip sensitive index holding onto the gains of over 15 points are trading above the 18500 mark, while the 50 share index-Nifty-is trading in red close to its neutral line. The broader indices imitating the footsteps of the larger peers are too trading mixed. The overall market breadth on BSE is in the favour of advances which have thumped declines in the ratio of 1135: 1038; while 103 shares remained unchanged.
The BSE Sensex is currently trading at 18,523.02, up by 20.64 points or 0.11%. The index has touched a high and low of 18,566.99 and 18,419.98 respectively. There were 18 stocks advancing against 12 declines on the index.
The broader indices were trading mixed; the BSE Mid cap index lost 0.06% and Small cap index surged 0.05% respectively.
The top gaining sectoral indices on the BSE were, FMCG up by 0.78%, IT up by 0.31%, PSU up by 0.19%, TECK up by 0.18% and CG up by 0.17%. While, CD down by 0.73%, Realty down by 0.57%, HC down by 0.54%, Auto down by 0.44% and Bankex down by 0.38% were the top losers on the index.
The top gainers on the Sensex were HUL up by 1.36%, Infosys up by 0.81%, Tata Motors up by 0.79%, ITC up by 0.75% and ONGC was up by 0.73%.
On the flip side, Hero Honda was down by 1.39%, Hindalco down by 1.09% HDFC Bank down by 1.07%, TCS down by 0.54% and BHEL down by 0.50% were the top losers on the Sensex.
Meanwhile, finance minister Pranab Mukherjee in a meeting with the financial journalists has once again reiterated that there is no policy paralysis in the government. The Finance minister said, the economy was in fine fettle and the perceived lack of progress on reforms was misplaced. He stuck to his growth targets and blamed perceptions of a slowdown on global factors, and stated that inflation would cool by the end of the fiscal.
Earlier, Prime Minister Manmohan Singh too had a meeting with editor group. In both the meeting government stressed that the there was no issue of policy decision taking and the government has formed group of ministers (GoM), to take final decision on important matters without needing clearance from cabinet. Finance minister said, 'There is an impression that we have given up on reforms,' by adding further he said, 'Whatever policy reforms or adjustments are required to attract investments will be taken.'
Finance Minister also put light on the vital policy reforms that have been pending for long period of time, the important legislations such as mining, food security and land acquisition bills are nearly ready and government will introduce in the monsoon session which is starts from 1 August. Finance minister also noted that government cleared a number of coal and steel projects and over a long period infrastructure investment taking place. 
However, the finance minister accepted the slow progress on the policy reforms due to lack of agreement in the coalition of UPA. Finance minister also rolled out the concerns over the health of economy and government's management of fiscal situation. On the uncertainty in global economic condition, finance minister said, 'We are not living in isolated world. We are a part of the global economy.' Finally finance minister put his optimism that inflation will cool down after the monsoon and by the end of the year inflation will be 6 to 7% by the end of this year from current level.
The S&P CNX Nifty is currently trading at 5,564.95, lower by 2.10 points or 0.04%. The index has touched a high and low of 5,578.90 and 5,536.25 respectively. There were 25 stocks advancing against 25 declines on the index.

The top gainers of the Nifty were Siemens up by 1.37%, HUL up by 1.28%, ITC up by 0.90%, Infosys up by 0.86% and ONGC up by 0.85%.Sesa Goa down by 2.19%, IDFC down by 1.75%, Axis Bank down by 1.41%, Dr Reddy down by 1.37% and Hero Honda down by 1.27% were the major losers on the index.

Most of the Asian equity indices were trading in the red; Shanghai Composite declined 0.62%, Hang Seng trimmed 0.23%, Nikkei 225 down by 0.13%, Seoul Composite slid 0.81%, Taiwan Weighted edged lower by 0.07% and Straits Times fell 0.05%.
On the flip side, Jakarta Composite gained 0.11%, KLSE Composite which inched up by 0.01% were the only gainers in the Asian pack

TREND FOR 21st JULY

Markets continue with see-saw game & today has again drifted lower in negative zone, may be we shall continue to see this kind of trend till the RBI declares it's policy next week. Thus the Nifty may move up to 5588 - 5658 & on the downside may drift to 5494 - 5468. Long positions can be taken in POLARIS for a target of 212, RELMEDIA for a target of 171, SUBEX fro a target of 83, TATASTEEL for a target of 632, WELCORP for a target of 210, MANGLMCEM for a target of 126.
                                                                      CHEERS !!!

A PATHETIC SESSION

Indian benchmark indices staged a pathetic performance in Wednesday's volatile trade session, expunging all the gains accumulated in the previous session. The frontline indices which got off to an encouraging start squandered the opportunity of building on the momentum as disappointing earnings announcements by heavyweight's exerted selling pressure on the key gauges. The dismal close looked even distressing because of the fact that markets across the globe displayed energetic performance and rallied as speculations grew that US lawmakers will agree to increase the nation's debt ceiling while the strong corporate earnings by Apple Inc and International Business Machines Corp coupled with upbeat housing numbers too supported global sentiments. However, back home the upbeat reports of Indian agriculture production registering a record increase of around 11% during the 2010-11 agriculture season and Ministry of Finance approving 31 foreign direct investment (FDI) proposals worth Rs 3844.70 crore too were overlooked by market participants. The marketmen were busy punishing heavyweight stocks like Wipro - India's third-largest software firm, Dr. Reddy's Laboratories Ltd., the second-biggest drugmaker, LIC Housing Finance etc for announcing disappointing first quarterly earnings. The benchmarks were also weighed down by index heavyweight Reliance Industries' fall amid reports that Finance Ministry has approved the $7.2 billion deal between Reliance Industries and Britain's BP Plc, which includes BP's purchase of 30% stake in Reliance's 23 blocks, including India's largest gas field KG-D6. Investors awaited the RBI's next policy announcement due on July 26 for further direction amid expectations that inflation and interest-rate cycle would peak out soon. The indices drifted closer towards the psychological 5,550 and 18,500 levels as profit booking was evident in Power, Healthcare and Capital Goods pockets.
Meanwhile, the benchmark got off to a positive opening but the optimism fizzled out sooner than later and the key indices gradually kept on loosing traction. Losses for the key gauges widened in the second half of trade as investors resorted to across the board selling. Eventually the indices snapped the session in the negative territory around the session's lowest point. The NSE's 50-share broadly followed index Nifty, plunged close to a percent though above the crucial 5,550 support level while Bombay Stock Exchange's Sensitive Index, Sensex slipped by over one hundred fifty points and closed just above the psychological 18,500 mark. The broader markets too failed to show any kind of fervor and settled on a weak note. On the sectoral front, it was the Power counter that languished at the bottom of the table with 1.73% losses on reports that the Ministry of Coal is likely to cancel the allocations of coal block to private developers, as the development of the coal block is being delayed by private developers. The defensive Healthcare pack too remained under pressure losing 1.71% points after heavyweights like Sun Pharma and Dr Reddy's plunged 1.55% and 2.05% respectively. On the other hand, FMCG counter was the only one which managed to settle in the green terrain with moderate rise because of around a percent gains in bellwether ITC. The markets drifted on higher volumes of over Rs 1. 47 lakh crore while the turnover for NSE F&O segment also remained on the higher side compared to Tuesday at over 1. 33 lakh crore. The markets breadth remained negative as there were 1195 shares on the gaining side against 1696 shares on the losing side while 131 shares remained unchanged.
Finally, the BSE Sensex lost 151.49 points or 0.81% to settle at 18,502.38, while the S&P CNX Nifty slipped by 46.50 points or 0.83% to close at 5,567.05.
The BSE Sensex touched a high and a low of 18,765.60 and 18,473.90, respectively. The BSE Mid cap and Small cap indices were down by 0.88% and 0.36% respectively.
The top gainers on the Sensex were DLF up 1.63%, ITC up 0.93%, Maruti Suzuki up 0.09% and Hindustan Unilever up 0.03%.
On the flip side, Wipro down 3.95%, Hindalco Inds down 2.71%, Jaiprakash Associate down 2.51%, Tata Power down 1.98% and Hero Honda down 1.90% were the top losers on the index.
The only gainer on the BSE sectoral space was FMCG up 0.24% While Power down 1.73%, Health Care (HC) down 1.71%, Capital Goods (CG) down 1.45%, Auto down 1.42%and Bankex down 1.34% was the only loser on the BSE sectoral space.
Meanwhile, the Ministry of Coal is likely to cancel the allocations of coal block to private developers, as the development of the coal block is being delayed by private developers. This coal blocks being jointly developed by private developers -- world's largest steel maker Arcelor Mittal, Reliance Energy, Hyderabad-based Lanco Group, GMR Energy, Navbharat Power and Vedanta subsidiary Sterlite Energy.
In January 2008, Ministry of Coal had allocated the Rampia and Dip Side of Rampia coal block, located in Mahanadi Coalfields in Orissa, to these six private developers to meet the coal requirements of their captive end use plants; on the condition that the production of coal to be commenced by January 2011. The coal ministry is annoyed due to delay in development of the coal block.
"Allocates are hereby warned and directed to develop the block immediately. Any further delay would lead to necessary action including de-allocation of the block," Ministry of Coal cited in the communication to private developers.
In past two review meetings held in June 2009 and July 2010, Coal Ministry noted that private developers had not taken any serious efforts for the development for the coal block regardless of repeated assurances. The coal ministry had also issued two showcause notices to private developers in September 2009 and July 2010 for delay in development of coal block. Ministry of coal was not convinced by the reason for delays given by the private firms in their reply to the notices.
The coal ministry issued similar warning letters to the public sector company Metals and Minerals Trading Corporation (MMTC) for delay in development of Gomia coal block and Jharkhand State Mineral Development Corp for Patratu and Robodih coal blocks. Coal Ministry warned Jharkhand State Electricity Board and Bihar State Mineral Development Corporation for delays in the progress of Urma Paharitola block in Jharkhand.
Earlier in May, a ministerial committee had suggested to issue warnings to 29 coal and 3 lignite blocks holding companies. The committee also had recommended cancelling 14 coal blocks and one lignite block allocated to six public sector units, including NTPC and three private companies, for failing in development of coal blocks. This year, government had cancelled allocation of coal blocks to many firms including public sector firm NTPC, Damodar Valley Corporation and Andhra Pradesh Power Generation Corporation.
The S&P CNX Nifty touched high and low of 5,645.40 and 5,555.10, respectively.
The top gainers of the Nifty were DLF up 1.31%, Siemens up 0.71%, ITC up 0.69%, Hindustan Unilever up 0.56% and Infosys up 0.17%.
On the flip side, Wipro down 4.14%, Hindalco down 3.41%, Ranbaxy down 2.59%, JP Association down 2.51% and Kotak Bank down by 2.31% were the top losers on the index.
The European markets were trading in green. France's CAC 40 surged 1.43%, Britain's FTSE 100 soared by 1.09% and Germany's DAX up by 0.47%.

All the Asian equity indices barring shanghai composite finished the day's trade in the positive territory on Wednesday following strong gains on Wall Street overnight as progress in US debt ceiling negotiations boosting investor sentiment. Japanese Nikkei surged over a percent in the trade, with technology shares were lifted by stellar earnings results from US titans IBM and Apple while, benchmarks in South Korea and Taiwan too rose 1.16 percent and 2.13 percent respectively as makers of tablet and smart phone components posted strong gains. However, Chinese main share index Shanghai composite ended 0.1 percent lower as investors' mood dampened by falls in resource shares, on concerns over potential fallout in local government debt and the uncertain global economic outlook.

MARKETS DRIFT LOWER

Indian frontline indices which displayed listless performance in the early afternoon session of trade, have drifted to intraday low levels after index heavyweight Reliance Industries suffered a kneejerk reaction and suddenly took a sharp plunge. Investors resorted to hefty profit booking and dragged the benchmark indices below the psychological 5,600 and 18,600 levels amid lack of significant upside triggers on the domestic front. The upside for local bourses was limited as investors punished IT heavyweight Wipro for announcement of lukewarm growth in earnings for Q1. Wipro has shaved off around four and half a percent while another disappointment was Dr Reddy's Laboratories which dived ahead of its Q1 result announcement expected later in the session. The gain in FMCG counter was the only counter that traded with moderate gains. On the global front, the European markets got off to an optimistic opening after Wall Street witnessed a sharp rally on back of strong corporate earnings, upbeat housing numbers and hopes of some headway in the ongoing impasse over US debt limit debate. The local investors also shrugged the positive leads from Asian markets, some of which rallied well over a percent point.  Meanwhile, the broader markets too are trading on a weak note lacking any fervor to climb to high levels. The bourses consolidated on weak volumes while the market breadth on BSE was in favor of advances in the ratio of 1444:1199 while 121 scrips remained unchanged.
The BSE Sensex is currently trading at 18,584.00 down by 69.87 points or 0.37% after trading as high as 18,765.60 and as low as 18,539.28. There were 8 stocks advancing against 22 declines on the index.
The broader indices were trading on a weak note; the BSE Mid cap index fell 0.44% and Small cap rose by 0.12% respectively. 
On the BSE sectoral space, FMCG up 0.76% and Realty up 0.21% were the only gainers, while Healthcare down 1.14%, Power down 1%, Capital Goods down 0.89%, IT down 0.81% and Teck down 0.79% were the major losers on the index.
The top gainers on the Sensex were DLF up by 1.52%, ITC up by 1.25%, Sterlite up by 0.60%, Jindal Steel up 0.58% and Tata Steel up 0.48%.
On the flip side, Wipro down by 4.58%, JP Associates down 1.55%, Hindalco down 1.44%, Hero Honda down 1.20% and NTPC down by 1.03% were the major losers on the index.
Commerce and Industry Minister Anand Sharma will meet the new Environment Minister Jayanthi Natarajan today to discuss the proposed manufacturing policy and industry concerns on green clearances for projects.
Many mega industrial projects from, infrastructure, constructions, power and mining projects like Posco in Orissa and Lavasa in Pune have been delayed due to environment related issues.  The draft new manufacturing policy which aims to attract foreign investment and increasing share of manufacturing sector to in the country's Gross Domestic Production (GDP), has been stuck because of inter-ministerial differences on the issues like labour and environment.
The draft manufacturing policy suggests that industries in National Manufacturing Investment Zones (NMIZs) - big enclaves which could even subsume special economic zones - should be given flexibilities to downsize labour. Likewise, it recommends changes in the environment norms which come in the way of investment.
Earlier, the Department of Industrial Policy and Promotion (DIPP) had issued a concept paper for setting up NMIZs, which are being planned as mega industrial cities with the entire infrastructure. Government is aiming to increase the share of manufacturing sector from 16% to 25% of GDP by 2025. The policy also targets to generate 100 million jobs. 
The S&P CNX Nifty is currently trading at 5,588.90, lower by 24.65 points or 0.44% after trading as high as 5,645.40 and as low as 5,574.75. There were 10 stocks advancing against 40 declines on the index.
The top gainers of the Nifty were DLF up by 1.67%, ITC up by 1.15%, Siemens up by 1%, Ambuja up by 0.98% and Tata Steel up by 0.49%.
Wipro down by 4.72%, Hindalco down 1.90%, JP Associates down 1.48%, Ranbaxy down 1.46% and NTPC down 1.38% were the major losers on the index.
Asian markets are exhibiting positive trends as Shanghai Composite added by 0.03%, Hang Seng rose 0.37%, Jakarta Composite gained 0.32%, KLSE Composite advanced 0.50%, Nikkei 225 surged 1.17%, Straits Times climbed 0.90%, Seoul Composite soared by 1.16% and Taiwan Weighted jumped by 2.13%.

The European markets have opened on a optimistic note as France's CAC 40 gained 0.66%, Germany's DAX rose 0.62% and London's FTSE added 0.42%

MARKETS COME OFF THEIR HIGHS

Increased buying by funds and retail investors sparked off by a firming trend on other Asian bourses mirroring the overnight gains in the U.S. market on the back of strong quarterly earnings posted by IBM and Apple, mainly led to the early spurt on the Dalal Street. However, local bourses have worn out some of its gains owing to the drag of the Index heavyweights such as Reliance Industries, Infosys, ICICI Bank and most importantly Wipro. India's No. 3 software services exporter- Wipro- got beaten down cruelly despite reporting numbers in line with the street expectation. However, the company's numbers that came in lower than its peers, became the reason of its drag, the stocks of the company were trading down with a cut of over 2%. On Consolidated basis, the Group's net profit has registered a gain of 1.24% at Rs 1334.90 crore for the quarter ended June 30, 2011 as compared to Rs 1318.60 crore for the quarter ended June 30, 2010.
On the global front, US stocks posted their best day since March on Tuesday after strong corporate results and as renewed hope for an agreement on thorny budget issues boosted investor confidence, thereby leading to an up move. Meanwhile, Asian markets rose on Wednesday boosted by the indications of progress on a US budget-reduction deal coupled with healthy earnings reports from U.S. companies. Investors took heart after big U.S. companies such as Coca-Cola Co., IBM and Apple reported better quarterly earnings. The US future indices too were showing an uptick on the screen trade.
Back home, stocks of Crompton Greaves which trading lower with a cut of above 10% too spooked the sentiment. The company has beaten down even since reporting Q1 numbers. On consolidated basis, the Group's net profit fell by 58.36% at Rs 79.47 crore for the quarter ended June 30, 2011 as compared to Rs 190.85 crore for the quarter ended June 30, 2010. Meanwhile, stocks from Information Technology, Power and TECk counters too were weighing on the sentiment. However, the stocks from FMCG, Realty and CD space were the ones that held on to their ground. The 30 scrip sensitive index gaining over 30 points was trading above the 18650 mark, similarly the 50 share index too was trading above the 5600 level. The broader indices being no different were showcasing trend similar to their larger peers. The overall market breath on BSE was in the favour of advances which have smashed declines in the ratio of 1422:1097, while 127 shares remained unchanged.
The BSE Sensex is currently trading at 18,691.21, up by 37.34 points or 0.20%. The index has touched a high and low of 18,765.60 and 18,682.61 respectively. There were 18 stocks advancing against just 12 declines on the index.
The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices rose 0.23% and 0.65% respectively.
The top gaining sectoral indices on the BSE were, FMCG up by 0.88%, Realty up by 0.60%, CD up by 0.46%, Oil & Gas up by 0.38% and Bankex up by 0.32%. While, IT down by 0.58%, Power down by 0.50%, TECk down by 0.43%, HC down by 0.24% and CG down by 0.16% were the only losers on the index.
The top gainers on the Sensex were DLF up by 1.54%, RCom up by 1.31%, ITC up by 1.18%, Reliance Infra up by 1.06% and Maruti Suzuki was up by 0.87%.
On the flip side, Wipro was down by 2.90%, Hindalco Industries was down by 1.57%, Hero Honda down by 0.89%, TCS down by 0.79% and Cipla down by 0.55% were the top losers on the Sensex.
Meanwhile, the agriculture production of India showed record increase of around 11% during the 2010-11 agriculture season (July to June), the farm production increased from 218 million tonne in 2009-10 to 242 million in 2010-11. Foodgrains include, rice, wheat coarse cereals and pulses. In 2009-10 season, the farm production had reduced by almost 7% to 218 million tonne from 234 million tonne in 2008-09.
However, sustaining the record output may be difficult this year because of the poor rainfall in July may affect sowing and eventually the output. In Mid-July, India received 3% below the normal rainfall with 13 meteorological departments reporting deficit in rainfall.  The 11% growth in agriculture production is due to increase in production of wheat, coarse cereals, maize and pulses. The production of wheat was 86 million during 2010-11 from 81 million tonne in 2009-10, similarly, production of coarse cereals was 42.22 million tonnes, production of maize was 21.28 million tonnes, and production of pulses was 18.09 million tonne. Experts say that this record increase in farm production is due to central government's policies. The production of wheat, coarse cereals, maize and pulses hit the all time high level.
Agriculture Secretary P K Basu said, 'We can easily produce 20 million tonnes of pulses by bringing follow land under cultivation and also through inter-cropping system...I do not think we have to import pulses after 3-4 years.' 
From the last few years government has increased the Minimum Support Prices for number of crops, which has allowed famers to apply more inputs to their crops, which resulted in increase in the overall production. Government had increased MSP for pulses up to Rs 700 per quintal. For some pulses the support price is increased by more than 20%.  The record increase in production of vegetable oilseeds also helped to reduce the import of vegetable oils about a million tonne. Last year country had imported around 9.2 million tonne of vegetable oils to meet the domestic demand.
Experts argue that government should allow exports of foodgains so that farmer gets the higher prices. Earlier in this month, government removed the ban from exports of non basmati rice and wheat. Country had the stock of 64 million tonne of food grain which is above the shortage capacity. However, the decision on removing ban from exports of food grains had hampered the possibility of making higher profits in international markets. 
Presently, India is in position to meet the domestic demand for the foodgrains, however, it has to increase the farm production to meet the future demand for foodgrains which is expected to be around 280 million tonne by 2020. The per capita consumption of cereals has declined; however, increase in population will require increase in production in absolute terms.
 The S&P CNX Nifty opened at 5,642.05; about 29 points higher compared to its previous closing of 5,613.55, and has touched a high and a low of 5,645.40 and 5,624.40 respectively.
The index is currently trading at 5624.10, higher by 10.55 points or 0.19%. The index has touched a high and low of 5,645.40 and 5,621.10 respectively. There were 26 stocks advancing against 24 declines on the index.

The top gainers of the Nifty were DLF up by 1.71%, RCom up by 1.26%, ITC up by 1.20%, Reliance Capital up by 1.08% and Siemens up by 1.07%.

On the flip side, Wipro down by 2.94%, Hindalco down by 1.57%, HCL Technologies down by 0.85%, TCS down by 0.80% and Cairn India down by 0.73%, were the major losers on the index.
All the Asian equity indices barring Shanghai Composite were trading in the green; Hang Seng gained 0.10%, Jakarta Composite rose 0.09%, KLSE Composite added 0.46%, Nikkei 225 surged 1.08%, Straits Times gathered 0.53%, Seoul Composite surged 1.09% and Taiwan Weighted spurted by 2.04%.
On the flip side, Shanghai Composite was down by 11.36 points or 0.41% to 2,785.62.