Friday, September 30, 2011

MARKETS PLUMMET

Indian equity indices went on to undo all the good work done in the September F&O expiry session as they shaved off about one and half a percent and drifted below the psychological 16,500 (Sensex)and 4,950 (Nifty) levels on Friday. Furthermore, the frontline indices even got obliterated by 12.8% for the quarter ended September 30, 2011, the biggest quarterly decline since the 25% plunge in the October-December quarter of 2008 amid the global financial crisis and their third straight quarterly decline. The domestic bourses were once again tormented by global developments on the last trading session of the week as investors fretted over global economic growth prospects which prompted them to take profits off the table amid little signs of recovery. The better than expected US GDP data which showed that the economy grew at a 1.3% pace in the Q2 along with the upbeat US Jobs data failed to bolster local sentiments. In addition, Chinese PMI data indicated that the factory sector contracted slightly for a third consecutive month in September while German retail sales declined the most in more than four years in August, stoking concern that the global economy is heading for another recession. The European counterparts got off to a gloomy start drifted deeper into the red while the Asian markets settled on a mixed note. On the domestic front, the Union Cabinet approved the new Mines and Minerals Development and Regulation Bill, 2011 which will mandate companies operating in the sector to provide 26 percent of post-tax profit for the welfare of affected people, a move intended to benefit mostly tribals. The development may hurt mining companies like Coal India, Hindustan Zinc, Tata Steel, Sesa Goa and JSPL by pushing down their profits and margins. Furthermore, Anil Dhirubhai Ambani Group's stocks like Reliance Communications, Reliance Capital, R Power and Reliance Infrastructure sank deeper into the red terrain and suffered nasty lacerations in the range of 3-13% after reports that the CBI told the Supreme Court that three Reliance Group executives, Gautam Doshi, Surendra Pipara and Hari Nair, may turn approvers in the case. The sharp plunge came despite the group's clarification that it was not a beneficiary of any telecom licence issued in January, 2008. Meanwhile, local sentiments were also undermined by reports that India's revenue collection during the second quarter of current financial year has declined significantly, which is indicative of the fact that Asia's third largest economy is slowing down, due to the weak global economic environment and nonstop hike by RBI. The overall advance tax collections have declined to 12% in July-September 2011 from 19% in April-June 2011.
Earlier on Dalal Street, the benchmark got off to a negative opening as the indices breached the psychological 5,000 and 16,600 levels in the early moments of trade since investors largely remained influenced by the cautiously pessimistic sentiments prevailing in Asian markets. Thereafter, the key indices showed some fervor and clawed back into the green terrain in morning trades. However, indices suffered a setback in afternoon trade as sudden bouts of profit booking emerged in the local markets after a somber European market opening, post which the indices could not stage any kind of recovery. Eventually the bourses pared almost all the gains garnered in the previous session and settled around the low point of the day. The NSE's 50-share broadly followed index Nifty, took a cut of about one and half a percent to settle below the crucial 4,950 support level while Bombay Stock Exchange's Sensitive Index, Sensex slipped by about two hundred fifty points and closed above the psychological 16,450 mark. Moreover, the broader markets too failed to show any kind of fervor and closed with losses of around half a percent, outclassing their larger peers. On the BSE sectoral space, Metal pocket remained top laggards in the space with over two and half a percent cuts as reports that Cabinet approved the new mining bill that weighed on sentiments. While rate sensitive sectors like Realty, Bankex and Auto too bore the brunt of hefty selling pressure and sank by close to two percent each. On the flipside, the Consumer durable counter was the only index which bucked the somber trend prevailing in the space and climbed by a percent. The markets got dragged on weaker volumes of over Rs 1.07 lakh crore while the turnover for NSE F&O segment too remained on the lower side as compared to Thursday at over 0.93 lakh core as it was the first day of a new F&O series. The market breadth remained pessimistic as there were 1019 shares on the gaining side against 1716 shares on the losing side while 134 shares remained unchanged.
Finally, the BSE Sensex plunged by 244.31 points or 1.46% to settle at 16,453.76, while the S&P CNX Nifty shaved off 72.20 points or 1.44% to close at 4,943.25.
The BSE Sensex touched a high and a low of 5,025.55 and 4,924.30 respectively. The BSE Mid cap and Small cap index were down by 0.58% and 0.88% respectively.
The major gainers on the Sensex were Bharti Airtel up 0.44% and Reliance up 0.02%. While, Coal India down 5.15%, Sterlite Industries down 4.05%, Tata Steel down 3.99%, Jindal Steel down 3.78% and Hero Motocorp down 3.01% were the top losers on the index.
The only gainer on the BSE sectoral space was Consumer Durables (CD) up 1.02%. However Metal down 2.68%, Realty down 2.08%. Bankex down by 1.84%, Auto down 1.76% and PSU down 1.62% were top loser on BSE sectoral space.
Meanwhile, the finance ministry on September 29, said the government in the second half of the current financial year would borrow an additional Rs 52,800 crore from the market, more than the budget estimate, sending bond yields higher. However, the government is hopeful that this additional borrowing will not affect the government's fiscal deficit target of 4.6% of the GDP in 2011-12.
After the meeting, the Reserve Bank of India's officers, the Economic Affairs Secretary R Gopalan, said, the government was increasing the gross borrowings by Rs 52,800 crore for the second half. 'The reason is a dip in the small savings collection.' Because of the increase in government borrowing in second half of the fiscal year, triggered an increase in the yields on the ten-year benchmark government bond by 10 basis points. It closed at 8.44% due to the extra borrowing from government was much higher than market expectations.
Actually, the additional borrowings are more than Rs 40,000 crore. The government is targeting to achieve this from the disinvestment of public sector units (PSUs). However, because of the present sluggish situation, meeting the disinvestment target would be difficult. Though, the government is hopeful of meeting this difficult target. 
For the current financial year, originally, the government was about to borrow Rs 4.17 lakh crore, but now it will borrow around Rs 4.7 lakh crore, this Rs 53,000 crore increase is due to lower cash balance and decline in collections from small savings schemes due to better interest rate offered by the banks to depositors. The budget calculations were made with an estimate of Rs 24,000 in the National Small Saving Funds (NSSF), however, it declined by Rs 35,000 crore.
In the first six months of current financial year, the government borrowed around Rs 2.5 lakh crore via dated securities, which is 60% of the total estimate made in budget. In next six months the government is scheduled to borrow around Rs 2.2 lakh crore from the market. The net borrowing will be around Rs 4 lakh crore for 2011-12. During 2010-11, the government had borrowed around Rs 4.37 lakh crore.
Giving stress on the increased need to go for dated securities on the place of depending on small saving, Gopalan said, 'there is a switch taking place from the NSSF into dated securities. Also we need to work to shore up the cash balance. It has nothing to do with fiscal deficit computation. The target of fiscal deficit remains unchanged.' By adding further he said, 'the borrowing calendar has been programmed in such a way that there is enough credit for the private sector.' Finance Minister Pranab Mukherjee earlier this year had said that the borrowing in the year would not expand the target, and the government would ensure that the private sector was not elbowed out of the market.
However, because of increase in the international energy prices, the government's expenditure has increased, while the revenue generation has been declined significantly, due to slowdown in growth. The government has raised only Rs 1,144 crore from the target of Rs 40,000 via disinvestment, as of now. And the advance tax collection also declined in the second quarter, it grew by 9% in July-September 2011, from 19% in April-June 2011.
To reduce government expenditure, the government has taken number of steps. It had issued instruction to all government departments to reduce all unavoidable expenditures, containing seminars and conferences at five star hotels or abroad, purchase of new vehicles, foreign travel, and appointment of consultants and reduce of new government posts. 
The S&P CNX Nifty touched high and low of 5,025.55 and 4,924.30, respectively.
The top gainers on the Nifty were Sesa Goa up 4.60%, Ranbaxy up 2.73%, Powergrid up 1.59%, Grasim up 1.16%, and Ambuja Cement up 1.16%. On the flip side, Reliance Capital down 13.17%, Reliance Communication down 7.99%, Reliance Infra down 7.27%, Sterlite Industries down 4.72% and Tata Steel down 4.30% were the top losers on the index.
The European markets were trading in red. France's CAC 40 lost 1.86%, Britain's FTSE declined by 1.71%, and Germany's DAX plunged by 2.94%.
Most of the Asian equity indices ended the trade in the negative terrain on last trading day of the week as cautious traders shrugged off strong US growth data and news the German parliament had approved a crucial EU bailout package. Moreover, Chinese benchmark edged lower on Friday to the lowest level in two and half years, winding up the third quarter with a 14.6 percent loss, as investors dumped financial and export-related stocks amid growing signs of an economic slowdown. Meanwhile, Chinese manufacturing sector contracted for a third consecutive month in September, indicated that the world's second-largest economy is not protected to global headwinds.

SETBACK

Indian frontline equity indices suffered a setback in Friday afternoon trades as sudden bouts of profit booking emerged in the local markets immediately after a somber European market opening. The benchmarks have receded to new lows in the session as they shaved off close to a percentage points and breached 16,600 (Sensex) and 5,000 (Nifty) levels on the downside. Sentiments remained dismal as worries over global economic growth prospects prompted marketmen to take profits off the table amid little signs of any supportive leads. The better than expected US economic reports, like the US GDP data which showed that the economy grew at a 1.3 percent pace in the second quarter, faster than previously estimated, along with the Jobs data which signaled that applications for jobless benefits dropped by a more-than forecast 37,000 to 391,000, failed to bolster local sentiments. While Chinese PMI data indicated that the factory sector contracted slightly for a third consecutive month in September, hurt by the Chinese central bank's liquidity tightening measures to curb inflation and as overseas demand for exports faltered. On the domestic front, the Union Cabinet approved a new bill on regulating and developing Mining which will mandate coal companies to provide 26 percent of post-tax profit for the welfare of affected people, a move intended to benefit mostly tribals. Shares of mining companies like Seas Goa shot up by 3.5% post the report hit headlines. On the other hand, Anil Dhirubhai Ambani Group's stocks like Reliance Communications, Reliance Capital, R Power and Reliance Infrastructure sank deeper into the red terrain and suffered nasty lacerations in the range of 4-10%. On the BSE sectoral space, Power pocket remained top laggards in the space with around one and half a percent cuts while sectors like high beta - Realty and PSU too witnessed some selling pressure. On the flipside, the Consumer durable counter was to only index which bucked the somber trend prevailing in the space and climbed by around a percent.
Moreover, the broader markets too slipped from the high point of the day and traded on a flat note in afternoon trades but outclassed their larger peers. The bourses rose on weak volumes of over Rs 0.50 lakh core, considering this is the first day of a new F&O series while the market breadth on BSE was in favor of declines in the ratio of 1248:1220 while 119 scrips remained unchanged.
The BSE Sensex is currently trading at 16,575.79 down by 122.28 points or 0.73% after trading as high as 16,745.16 and as low as 16,495.51. There were 4 stocks advancing against 26 declines on the index.
The broader indices were trading on a flat to positive note; the BSE Mid cap index added 0.13% and Small cap rose 0.04%.
On the BSE sectoral space, Consumer Durables up 0.96% was the only gainer while Power down 1.31%, Realty down 1.29%, PSU down 1.05%, Bankex down 1.03% and FMCG down 0.95% were the major losers in the space.
Bharti Airtel up 2.54%, L&T up 0.61%, RIL up 0.32% and M&M up 0.12% were the only gainers on the Sensex, while ONGC down 2.66%, Tata Power down 2.25%, Hero Moto down 1.95%, Tata Steel down 1.79% and SBI down 1.54% were the major losers on the index.
Meanwhile, Prime Minister's Economic Advisory Council (PMEAC) Chairman C Rangarajan on September 29 said that the government is likely to miss the fiscal deficit target of 4.6% for the current fiscal as growth is expected to moderate.
The PMEAC Chairman said 'In the current year, the budgeted fiscal deficit is 4.6% (of GDP). It is going to be difficult to achieve this. All the numbers do not gel well,' however by adding further he said 'But I think it should be one of efforts to ensure that fiscal deficit is in the lines of what was estimated."
Earlier, the economic growth was estimated at 8.2% for 2011-12. PMEAC Chairman said despite a stronger agricultural growth than what was estimated earlier, the economy is expected to grow about 8% during the current fiscal as there are serious concerns. 'Therefore, taking all these factors into account, I believe the growth rate of the economy can be close to 8% per annum,' he added. However, Rangarajan believe that the India can grow by 9% given the saving and investment rates.
Identifying Inflation, balance of payment and fiscal consolidation as the short-term constrain to growth, Rangarajan said 'I believe there are short-term concerns and medium-term constraints which will come in the way of achieving 9% growth'.
Backing Reserve Bank of India's monetary policy stance on inflation, he said 'In fact today the non-food manufacturing index exceeds 7.5 per cent. Therefore, we should be using monetary policy to tame inflationary expectations.' By adding further he said 'We should use monetary policy in way that demand preference is brought down'.
In last 18 months, the RBI has increased its short term lending and deposit rates by 12 times to control inflation. However, the headline inflation measured by the Wholesale Price Index (WPI) has been hovering around two digit mark.
On the Current Account Deficit (CAD), PMEAC Chairman said 'I don't think that by taking both imports and exports of goods and services taken together we might exceed 2.5% of GDP of the CAD this year.' So far, financing of CAD has not been a problem. The approach paper of 12th Five-Year Plan and our own calculation indicates that we will have CAD of 2.5% of GDP'.
PMEAC Chairman said at present, there is no problem in financing CAD of 2.5%. By adding further he said, 'So long we continue to maintain a healthy growth rate and so long as fiscal deficit continue to remain at reasonable control, there should be no problem in attracting capital flow'.
However, he said that the capital flows by very nature are very volatile. It is influenced by both domestic and international factors. It is also affected by push factor and as well pull factor. So, therefore, we need to moderate our dependence on the financing of CAD through capital flows.
On the borrowing he said 'I think the effort of the government will be to retain the fiscal deficit at the budgeted level and I do not expect the borrowing programme of the government of India as of now to exceed what was originally estimated'.
The S&P CNX Nifty is currently trading at 4,972.35, lower by 43.10 points or 0.86% after trading as high as 5,025.55 and as low as 4,952.75. There were 11 stocks advancing against 39 declines on the index.
The top gainers on the Nifty were Seas Goa up 3.19%, Ranbaxy up 2.94%, Bharti Airtel up 2.53%, Ambuja Cement up 1.73% and ACC up 0.86%.
R Capital down 9.61%, R Com down 6.70%, R Infra down 6.65%, R Power down 4.26% and Siemens down 3.79% were the major losers on the index.
Asian markets traded on a mixed note, Shanghai Composite declined 0.40%, Hang Seng plunged 2.19%, KLSE Composite eased 0.03%, Nikkei 225 inched down 0.01% and Straits Times sank 1.27%.
On the contrary, Jakarta Composite climbed 055%, Seoul Composite gained 0.02% and Taiwan Weighted garnered 0.60%.
The European markets traded on a bleak note as France's CAC 40 declined 0.91%, Germany's DAX plunged 1.14% and Britain's FTSE 100 descended 0.87%.

MARKETS TRADE FLAT

The Indian equity markets were pulled back from the highs and currently trading flat and with minor losses at late morning trades. Sensex falter after smart recovery, while Nifty was below 5,000 mark. Investors were mostly treading on a cautious path amid a lack of triggers. On sectoral front, power, PSU and realty stocks were among the prominent losers. Bank, FMCG and information technology stocks were off their highs due to lack of support. Consumer durables and capital goods stocks were finding good support, while pharmaceuticals and oil were mostly trading flat. ADAG stocks are down sharply in the red due to heavy selling on the back of reports that the Central Bureau of Investigation is probing the role of Anil Ambani in a multi-billion dollar telecom scandal. Reliance Power, Reliance Communications, Reliance Infrastructure and Reliance Capital plunged 4-9%. On the global front, Asian stock markets were trading on a mixed note. Back home, the market breadth favoring the positive trend; there were 1,274 shares on the gaining side against 1,077 shares on the losing side while 113 shares remained unchanged.
The BSE Sensex is currently trading at 16,668.25, down by 29.82 points or 0.18%. The index has touched a high and low of 16,745.16 and 16,495.51 respectively.  There were just 10 stocks advancing against 19 declines on the index and one remained unchanged.
The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices were up by 0.43% and 0.22% respectively.  
The only gaining sectoral indices on the BSE were, CD up by 1.23%, CG up by 0.46%, HC up by 0.18%, TECk up by 0.13% and Oil & Gas up by 0.05%. While, Power down by 0.84%, PSU down by 0.70%, Bankex down by 0.65%, Realty down by 0.60% and FMCG down by 0.52% were the top losers on the index.
The top gainers on the Sensex were Bharti Airtel up by 1.98%, L&T up by 1.26%, Reliance up by 1.21%, JP Associate up by 0.81% and Bajaj Auto up by 0.36%.
On the flip side, ONGC down by 2.32%, Tata Power down by 2.10%, Heromoto Corp down by 1.46%, SBI down by 1.25% and HUL down by 0.96% were the top losers on the index.
Meanwhile, the finance ministry on September 29, said the government in the second half of the current financial year would borrow an additional Rs 52,800 crore from the market, more than the budget estimate, sending bond yields higher. However, the government is hopeful that this additional borrowing will not affect the government's fiscal deficit target of 4.6% of the GDP in 2011-12.
After the meeting the Reserve Bank of India's officers, the Economic Affairs Secretary R Gopalan, said, the government was increasing the gross borrowings by Rs 52,800 crore for the second half. 'The reason is a dip in the small savings collection.' Because of the increase in government borrowing in second half of the fiscal year, triggered an increase in the yields on the ten-year benchmark government bond by 10 basis points. It closed at 8.44% due to the extra borrowing from government was much higher than market expectations.
Actually, the additional borrowings are more than Rs 40,000 crore. The government is targeting to achieve this from the disinvestment of public sector units (PSUs). However, because of the present sluggish situation, meeting the disinvestment target would be difficult. Though, the government is hopeful of meeting this difficult target. 
For the current financial year, originally, the government was about to borrow Rs 4.17 lakh crore, but now it will borrow around Rs 4.7 lakh crore, this Rs 53,000 crore increase is due to lower cash balance and decline in collections from small savings schemes due to better interest rate offered by the banks to depositors. The budget calculations were made with an estimate of Rs 24,000 in the National Small Saving Funds (NSSF), however, it declined by Rs 35,000 crore.
In the first six months of current financial year, the government borrowed around Rs 2.5 lakh crore via dated securities, which is 60% of the total estimate made in budget. In next six months the government is scheduled to borrow around Rs 2.2 lakh crore from the market. The net borrowing will be around Rs 4 lakh crore for 2011-12. During 2010-11, the government had borrowed around Rs 4.37 lakh crore.
Giving stress on the increased need to go for dated securities on the place of depending on small saving, Gopalan said, 'there is a switch taking place from the NSSF into dated securities. Also we need to work to shore up the cash balance. It has nothing to do with fiscal deficit computation. The target of fiscal deficit remains unchanged.' By adding further he said, 'the borrowing calendar has been programmed in such a way that there is enough credit for the private sector.' Finance Minister Pranab Mukherjee earlier this year had said that the borrowing in the year would not expand the target, and the government would ensure that the private sector was not elbowed out of the market.
However, because of increase in the international energy prices, the government's expenditure has increased, while the revenue generation has been declined significantly, due to slowdown in growth. The government has raised only Rs 1,144 crore from the target of Rs 40,000 via disinvestment, as of now. And the advance tax collection also declined in the second quarter, it grew by 9% in July-September 2011, from 19% in April-June 2011.
To reduce government expenditure, the government has taken number of steps. It had issued instruction to all government departments to reduce all unavoidable expenditures, containing seminars and conferences at five star hotels or abroad, purchase of new vehicles, foreign travel, and appointment of consultants and reduce of new government posts. 
The S&P CNX Nifty is currently trading at 4,999.35, down by 16.10 points or 0.32%. The index has touched a high and low of 5,025.55 and 4,952.75 respectively.  There were 18 stocks advancing against 32 declines on the index.
The top gainers of the Nifty were Ranbaxy up by 2.45%, Sesa Goa up by 2.43%, Bharti Airtel 2.13%, Ambuja Cement up by 1.97% and Reliance up by 1.17%.
Reliance Capital down by 9.53%, Reliance Communication down by 8.12%, Reliance Infra down by 6.82%, Reliance Power down by 4.45% and Siemens down by 2.73% were the major losers on the index.
Asian equity indices were trading mixed; Hang Seng was down by 1.82%, Straits Times was down by 1.14% and Seoul Composite was down by 0.07%
On the flip side, Shanghai Composite up by 0.02%, Nikkei 225 was up by 0.19%, Taiwan Weighted up by 0.60%, Jakarta Composite was up by 0.25% and KLSE Composite was up by 0.01%.

NEGATIVE START

The Indian equity markets have made a negative start tracking weak cues from global indices. The US markets made a mixed closing after a volatile day of trade overnight while, most of the Asian markets were trading in the negative terrain at this point of time. Back home, selling witnessed in most of the key heavyweights dragged the NSE's Nifty below their crucial 5,000 mark. Moreover, Anil Dhirubhai Ambani Group (ADAG) companies like Reliance Capital, Reliance Infra, Reliance Power and RCom down by 4-7 percent in the trade as the CBI has informed the Supreme Court that it is probing the alleged involvement of Anil Ambani in the 2G scam. On the sectoral front, consumer durables, capital goods and healthcare remained the only gainers while, oil and gas, power and banking remained the top losers on the BSE sectoral space. The broader indices were outperforming benchmarks while, the market breadth has made a positive start; there were 1,029 shares on the gaining side against 706 shares on the losing side while 59 shares remained unchanged.
The BSE Sensex opened at 16,599.74; about 100 points lower compared to its previous closing of 16,698.07, and has touched a low of 16,495.51 while high remain its opening.
The index is currently trading at 16,559.82, down by 138.25 points or 0.83%. There were just 4 stocks advancing against 26 declines on the index.
The overall market breadth has made a positive start with 57.36% stocks advancing against 39.35% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices were up by 0.35% and 0.34% respectively.  
The only gaining sectoral indices on the BSE were, CD up by 1.24%, CG up by 0.48% and HC up by 0.16%. While, Oil and Gas down by 1.33%, Power down by 1.13%, Bankex down by 1.11%, IT down by 1.10% and FMCG down by 0.84% were the top losers on the index.
The top gainers on the Sensex were L&T up by 1.57%, Bajaj Auto up by 1.13%, Bharti Airtel up by 0.41% and Coal India was up by 0.20%.
On the flip side, Tata Power down by 1.81%, Jaiprakash Associates down by 1.75%, HUL down by 1.70%, BHEL down by 1.64% and SBI down by 1.54% were the top losers on the index.
Meanwhile, describing bounce back in India' weekly food inflation as grave concern, Finance Minister Pranab Mukherjee has said that 'Food inflation has gone up and it is perilously close to double digits... Food prices are an area of major and grave concern.'
Country's weekly food inflation measured by the wholesale price index (WPI) increased to 9.13% for the week ended September 17 from 8.84% in the last week. The surge in weekly food inflation after three consecutive weeks of decline was due to increase in prices of potatoes, pulses and poultry. However, as per the official data, prices of gram, masoor, arhar, urad and poultry increased on an annual basis. Potato prices too increased by about 15% on an annual basis for the week under observation. However, the WPI for Non-Food article declined significantly, it fell by almost 5% to 12.89% for week ended September 17 from 17.42% in last week. 'As a result, WPI inflation in primary articles has declined. But fuel and power, light and lubricants, they have also contributed (to rising inflation),' finance minister said.
The S&P CNX Nifty opened at 4,990.15; about 9 points higher compared to its previous closing of 5,015.45, and has touched a low of 4,952.75 while, high remained its opening.
The index is currently trading at 4,973.50, down by 41.95 points or 0.84%. There were 9 stocks advancing against 41 declines on the index.
The top gainers of the Nifty were Sesa Goa up by 2.85%, Ranbaxy up by 1.92%, L&T up by 1.56%, Bajaj Auto up by 1.26% and Ambuja Cement up by 1.16%.
Reliance Capital down by 6.42%, Reliance Infra down by 5.33%, Reliance Power down by 4.26%, RCom down by 4.12% and PNB was down by 2.52%, were the major losers on the index.
Most of the Asian equity indices were trading in the red; Shanghai Composite was down 8.86 points or 0.37% to 2,356.48, Hang Seng was down 374.59 points or 2.08% to 17,636.47, Nikkei 225 was down 34.13 points or 0.39% to 8,667.10, Straits Times was down 40.99 points or 1.51% to 2,667.14, Seoul Composite was down 21.72 points or 1.23% to 1,747.57 and Taiwan Weighted was down by 11.18 points or 0.16% to 7,171.43.
On the flip side, Jakarta Composite was up 8.74 points or 0.25% to 3,545.92 and KLSE Composite was up by 0.19 points or 0.01% to 1,387.65.

Thursday, September 29, 2011

TREND FOR 30th SEPTEMBER

Markets have bounced back in positive zone & technically are above 5 & 10 EMA, thus the Nifty may move up to 5110 & on the downside may slip to 4969. Long positions can be taken in ORIENTBANK for a target of 325, POLARIS for a target of 154, RANBAXY for a target of 570, SIEMENS for a target of 917, SYNDIBANK for a target of 117,TORNTPOWER for a target of 242.

                                                                CHEERS !!!

SHORT COVERING RALLY

The September series futures and options expiry session turned out to be a action-packed event for the domestic frontline indices as they staged a smart intraday come-back and even went ahead to recapture the psychological 5,000 levels for the Nifty while the Sensex settled near to 16,700 levels. Investors remained optimistic as Germany's parliament was expected to approve a proposal to increase the scope and size of the European Financial Stability Facility (EFSF), offering some relief from concerns that deep political divisions are hampering efforts to end the region's debt crisis. Germany's approval of an enhanced rescue fund could go a long way to shore up Europe's defenses against a crisis that has already seen three countries bailed out and stoked talk that Greece will default. Local market participants lacked conviction to cover their shorts in the morning session of trade as disappointing weekly inflation reading weighed on sentiments. India's food and fuel inflation jumped to 9.13% and 14.69% for the week ended September 17 from 8.84% and 13.69% in the previous week, respectively. The inflation continues to remain stubborn, indicating high inflationary pressures on the economy which may prompt the RBI to extend its aggressive monetary tightening measures. But the sanguinity gradually crept-in since afternoon session amid some tentative recovery in investors' morale. Meanwhile, a rebound was also evident in European markets which turned positive after a somber opening while most indices in Asia too settled on a positive note after a weak start. Back home, hefty shorts were covered from the rate sensitive Automobile counter which topped the sectoral gainers chart with over two percent gains. Information technology counter too witnessed hefty buying interests on the back of rupee depreciation which helped boost the IT companies' margins. On the flipside, the Consumer Durables, Capital Goods and Healthcare pockets failed to go home with gains.
Earlier on the Dalal Street, the benchmark got off to a negative opening as the indices drifted below the psychological 4,950 and 16,400 levels in the early moments of trade since investors largely remained influenced by the cautiously pessimistic sentiments prevailing in Asian markets. After trading with moderate cuts through the morning session, the key indices gradually crawled into the green territory. Short covering intensified in late hours of trade which stoked the bourses to the highest point in the session. Finally some profit booking in the dying moments of trade led the bourses snap the session just below the session's highs. The NSE's 50-share broadly followed index Nifty, shut shop after surging over one and half a percent and regained the crucial 5,000 support level while Bombay Stock Exchange's Sensitive Index, or Sensex accumulated over two hundred fifty points to close a tad below the psychological 16,700 mark. The broader markets failed to show any kind of fervor and settled on an uninspiring note, underperforming their larger peers by a fat margin. On the F&O front, the September series expired on a heartening note as the benchmarks garnered over three and half a percent gains, a month after registering the worst series performance since October 2008. On expected lines, markets registered strong volumes of over Rs 2.35 lakh crore on the September series F&O settlement day. The turnover for NSE F&O segment remained on the higher side compared to Wednesday at over 2.27 lakh crore. The market breadth remained pessimistic as there were 1265 shares on the gaining side against 1507 shares on the losing side while 110 shares remained unchanged.
Finally, the BSE Sensex surged 252.02 points or 1.53% to settle at 16,698.07, while the S&P CNX Nifty soared by 69.55 points or 1.41% to close at 5,015.45.
The BSE Sensex touched a high and a low of 16,756.08 and 16,316.66 respectively. The BSE Mid cap and Small cap index were down by 0.16% and 0.11% respectively.
The major gainers on the Sensex were Jaiprakash Associate up 6.29%, Tata Motors up 3.21%, Infosys up 3.04%, HDFC Bank up 2.94% and M&M up 2.39%. While, L&T down 2.47%, Coal India down 1.32%, Sterlite Industries down 1.17%, SBI down 0.94% and Sun Pharma down 0.79% were the top losers on the index.
The top gainers on the BSE sectoral space was Auto up 2.35%, IT up 2.03%, FMCG up 1.82%, Oil & Gas up 1.49% and Bankex up 1.46%. However Consumer Durables (CD) down 1.36%, Capital Goods (CG) down 0.89% and Health Care (HC) down 0.13% were top loser on BSE sectoral space.
Meanwhile, India's weekly food inflation measured by the wholesale price index (WPI), after declining for three consecutive weeks have surged to 9.13% for the week ended September 17 from 8.84% in last week. The increase was due to surge in price of Egg, Meat & Fish, Potato and Pulses. 
According to the data released by Ministry of Commerce and Industry, the index for Food Articles group rose by 0.8% to 197.3 (Provisional) from 195.7  (Provisional) for the previous week due to higher prices of gram (6%), masur, arhar, urad, poultry chicken, condiments & spices and fish-marine (2% each) and fruits & vegetables, maize, jowar and milk (1% each).  However, the prices of barley (4%), coffee (3%) and bajra and ragi (2% each) declined.
The index for Non-Food Articles group declined by 0.3% to 184.8 (Provisional) from 185.4  (Provisional) for the previous week due to lower prices of flowers (15%), soyabean (7%), groundnut seed and raw jute (3% each) and gingelly seed (1%).  However, the prices of raw silk (7%), raw cotton (4%), raw rubber (2%) and fodder, mesta, copra (coconut) and linseed (1% each) moved up.
The index for 'Minerals' group declined by 0.9% to 303.6 (Provisional) from 306.3 (Provisional) for the previous week due to lower prices of copper ore (15%), chromite (10%), bauxite (7%) and barytes (4%).  However, the prices of magnesite (14%), zinc concentrate (11%), sillimanite (7%), steatite (6%), dolomite (3%) and iron ore (2%) moved up.
As a result, the index for primary articles group which has the highest weightage of 20.12% in WPI rose by 0.4 % to 202.7 (Provisional) from 201.9 (Provisional) for the previous week. The annual rate of inflation, calculated on point to point basis, stood at 11.43% (Provisional) for the week ended September 17 as compared to 12.17 % (Provisional) for the previous week.
Meanwhile, the index for Fuel and Power group which has a weightage of 14.91% in WPI, rose by 0.7% to 169.4 (Provisional) from 168.2 (Provisional) for the previous week due to higher prices of petrol (5%),  light diesel oil and furnace oil (4% each), naphtha and aviation turbine fuel (3% each) and bitumen (1%).  However, the prices of electricity (industry) (5%) declined. The annual rate of inflation, calculated on point to point basis, stood at 14.69 % (Provisional) for the week ended September 17 as compared to 13.96 % (Provisional) for the previous week.
The surge in weekly food inflation is likely to raise the concern of the government and industry as the Reserve Bank of India has reiterated that the RBI is ready to sacrifice some economic growth in order to control inflation and inflation expectations. In order to control inflation, the RBI since March 2010, has increased its short term lending rates by 350 basis points or 3.5%, as a result, cost of capital has increased significantly, affecting the pace of investment and growth of the economy.
The S&P CNX Nifty touched high and low of 5,034.25 and 4,906.00, respectively.
The top gainers on the Nifty were JP Associate up 7.07%, Kotak Bank up 3.74%, Infosys up 3.23%, Siemens up 3.19%, and BPCL up 3.14%. On the flip side, Sesa Goa down 2.27%, L&T down 2.15%, Reliance Capital down 2.09%, Sterlite Industries down 1.41% and Reliance Infra down 1.24% were the top losers on the index.
The European markets were trading mixed. France's CAC 40 lost 0.16%, Britain's FTSE declined by 0.36%, and Germany's DAX advanced by 0.13%.
Most of the Asian equity indices ended the day's trade in the green on Thursday ahead of an expected vote by Germany's parliament to approve the strengthening of a bailout fund intended to help European countries mired in debt crises. Moreover, recovery in some of the commodities and US stock futures on hopes of progress on Europe's debt debacle too supported the sentiments. The Nikkei average reversed all its initial losses to retake the 8,700 level for the first time in over a week, on a rush of buying in the final half-hour of trade as on hopes of growth on European debt disaster. However, Chinese benchmark Shanghai Composite dropped over a percent on Thursday to a nearly 15-month closing low, weighed down by commodity and construction-related stocks, as weakness in global stock markets reignited growth concerns. While, Hong Kong financial markets and businesses remained shut for the trade.

Wednesday, September 28, 2011

DIRECTIONLESS

The Indian equity markets are trading directionless in the negative territory but came off from the days low as markets recovered some lost ground. The broader markets have turned weak. The markets are expected to be volatile in the near future as traders roll over positions in the futures and options tomorrow. Investors were doubtful on the global economic situation. On sectoral front IT, technology, realty and FMCG stocks were on buyers' radar. However, metal, capital goods, auto and bank stocks were under pressure. Stocks from power, PSU and healthcare sectors were trading weak now. On the global front, Asian markets were trading mixed amid easing concerns about euro zone debt. However, along with doubts about the effectiveness of rescue plans that are likely to be put in place by European leaders, a section of traders appear to be trimming down some positions across the board today. Back home, the market breadth favoring the negative trend; there were 1,116 shares on the gaining side against 1,320 shares on the losing side while 105 shares remained unchanged.
The BSE Sensex is currently trading at 16,444.39, down by 79.64 points or 0.48%. The index has touched a high and low of 16,663.26 and 16,372.64 respectively. There were 7 stocks advancing against 23 declines on the index.
The broader indices also following the benchmarks; the BSE Mid cap and Small cap indices were down by 0.31% and 0.40% respectively.
The top gaining sectoral indices on the BSE were, IT up by 1.44%, TECk up by 0.70%, Realty up by 0.54% and FMCG up by 0.24%. While, Metal down by 1.69%, CG down by 1.32%, Auto down by 1.19%, Bankex down by 1.03% and CD down by 0.97% were the top losers on the index.
The top gainers on the Sensex were DLF up by 2.05%, Infosys up by 1.80%, Wipro up by 1.12%, TCS up by 0.93% and ONGC was up by 0.41%.
On the flip side, Hindalco Industries was down by 3.08%, Sterlite Industries down by 2.79%, Jaiprakash Associate down by 2.32%, L&T down by 1.92% and ICICI Bank down by 1.81% were the top losers on the Sensex.
Meanwhile, to improve transparency and lay down principles for the implementation and monitoring of public-private partnership, the government came up with the draft national public-private partnership policy. This move of the government is expected to provide strong working ground as it is planning to invest around $1 trillion to develop infrastructure in coming five years.
While releasing the draft policy, the government has asked for comments by October 15. The proposed draft seeks to introduce roles for auctioning natural resources, acquiring land and settling disputes arising in the course of bidding and award of the projects. With reference to providing land for PPP projects, which has been center of attraction due to recent protest by the farmers, the policy says, the government will be responsible for providing land for PPP projects and obtaining clearances from relevant authorities. However, it will make sure that the interests of the land owners are fully protected.
The announcement of the national PPP policy is in line with the Budget speech of Finance Minister, in which, he had stressed on the need for developing a comprehensive policy that can be used by the centre and the state government in further developing Public-Private Partnerships. In order to bring transparency in the PPP projects, the government is planning to publish separate mandatory disclosures and fair practices to be followed by each project. 
The draft says, 'the government will set up a dedicated dispute resolution mechanism to address issues related to bidding and award of PPP projects....it will develop new market-based products, such as independent pre-bid rating, to assist investors in identifying well-structured PPP projects.'
For providing implicit ownership or exclusively right over underlying natural resources, a process of market based price discovery of such natural resources would be taken into consideration while awarding the projects. The PPP unit of ministry of finance will give a centre of expertise and technical support to government ministries and other authorities developing PPPs. 
The S&P CNX Nifty is currently trading at 4,944.25, down by 27.00 points or 0.54%. The index has touched a high and low of 5,006.05 and 4,922.35 respectively.  There were 12 stocks advancing against 38 declines on the index.
The top gainers of the Nifty were HCL Tech up by 2.87%, Ranbaxy up by 2.13%, Infosys up by 1.85%, DLF up by 1.81% and Cain up by 1.21%.
On the flip side, Hindalco Industries down by 3.01%, JP Associate down by 2.93%, Sterlite Industries down by 2.75%, Reliance Capital down by 2.58% and Reliance Power down by 2.56%, were the major losers on the index.
Most of the Asian equity indices were trading mixed; Jakarta Composite was up by1.41%, KLSE Composite was up by 0.28% and Taiwan Weighted was up by 0.80%.
On the flip side, Shanghai Composite down by 0.29%, Nikkei 225 was down by 0.05%, Hang Seng down by 1.47%, Seoul Composite was down by 0.41% and Straits Times down by 1.22% were the losers on the index.

CONSOLIDATION

The Indian equity markets have made a positive start tracking firm cues from global equity indices but, the local indices pared most of their initial gains and are trading flat as investors remained cautious ahead of the F&O series expiry on Thursday. The US markets closed higher on Tuesday, for the third consecutive session while, most of the Asian counterparts were trading in the positive terrain at this point of time. Back home, on the sectoral front software witnessed the maximum gain in trade followed by technology and consumer durables while, banking, metal and capital goods were the top losers on the BSE sectoral space. Meanwhile, PSU oil marketing companies BPCL, HPCL and IOC all edged lower in the trade as crude oil prices surged overnight extending their upmove as hopes grew for resolution to euro debt crisis, moreover, banking sector remained under pressure as the Reserve Bank of India Governor D Subbarao has strongly defended his monetary policy actions to tackle soaring inflation. The broader indices were outperforming benchmarks. The market breadth on the BSE was positive; there were 1,009 shares on the gaining side against 624 shares on the losing side while 76 shares remained unchanged.
The BSE Sensex opened at 16,663.26; about 61 points higher compared to its previous closing of 16,524.03 and has touched a low of 16,471.84 while high remained its opening.
The index is currently trading at 16,550.07, up by 26.04 points or 0.16%. There were 11 stocks advancing against 19 declines on the index.
The overall market breadth has made a strong start with 59.04% stocks advancing against 36.51% declines. The broader indices were outperforming benchmarks; the BSE Mid cap and Small cap indices rose 0.41% and 0.17% respectively.
The top gaining sectoral indices on the BSE were, IT up by 2.70%, TECk up by 1.85%, CD up by 0.99%, PSU up by 0.38% and Oil and Gas was up by 0.12%. While, Bankex down by 0.48%, Metal down by 0.41%, GC down by 0.38%, Power down by 0.13% and Auto down by 0.10% were the top losers on the index.
The top gainers on the Sensex were Infosys up by 3.11%, Wipro up by 2.37%, TCS up by 2.09%, Tata Motors up by 2.02% and ONGC was up by 0.70%.
On the flip side, Sterlite Industries was down by 1.39%, HUL was down by 0.97%, ICICI Bank was down by 0.90%, Hindalco was down by 0.89% and M&M was down by 0.88% were the top losers on the Sensex.
Meanwhile, the ministry of finance is firm in its decision to impose any kind of limits on foreign direct investment (FDI) in the Rs 47,000 crore pharmaceuticals sector, as against the department of industrial policy and promotion (DIPP), which is pushing for a more restrictive policy. The DIPP is pushing for more restrictive policy, in order to restrict the domestic pharma firms takeover by international firms, as it doubts that the increased ownership of the sector will increase the prices of medicine in the domestic market.
As per finance ministry official, any such move would be retrograde and detrimental to the India's image as an investment destination. Presently, foreign investors are allowed to invest 100% in country without the Foreign Investment Promotion Board's (FIPB) prior permission. The planning commission also shares the similar view, which also considers that the restricting foreign investment may affect the investment in the sector.
The ministry of finance and planning commission are of the view that there are alternative mechanisms to ensure the competitiveness in the sector and the competition regulator can address those concerns. On September 27, an expert committee headed by Arun Maira, Planning Commission Member, will discuss the recommendation. The committee will also consider the view expressed by the all stakeholders, including the health and finance ministries and pharmaceutical companies.
The panel was set up following directions from the cabinet committee of economic affairs (CCEA), chaired by Prime Minister Manmohan Singh. The recommendation came after anxieties were expressed within some sections of the government and the civil society on the issue of increasing price of generic drugs after a spate of acquisitions of the domestic companies by foreign companies.
However, the DIPP suggestion has the backing of the Council for Scientific and Industrial Research (CSIR) and the health ministry. The DIPP, which does not mind 100% FDI in new projects, had earlier suggested that all investment applications in the pharmaceuticals sector be sent for approvals by the FIPB. 'Foreign investments should not act as mere substitution for the sector and should bring additionality resulting in net capital formation.'
The S&P CNX Nifty opened at 5,005.50; 34 points higher compared to its previous closing of 4,971.25, and has touched a high and a low of 5,006.05 and 4,956.80 respectively.
The index is currently trading at 4,977.75, up by 6.50 points or 0.13%. There were 16 stocks advancing against 34 declines on the index.
The top gainers of the Nifty were HCL Tech up by 3.80%, Infosys up by 3.31%, Wipro up by 2.50%, Tata Motors up by 2.09% and Cairn up by 2.05%.
On the flip side, Sterlite Industries down by 1.43%, BPCL down by 1.36%, Kotak Bank down by 1.24%, SAIL down by 1.19% and Reliance Infra down by 1.15%, were the major losers on the index.
Most of the Asian equity indices were trading in the green; Shanghai Composite was up 4.34 points or 0.18% to 2,419.39, Jakarta Composite was up 55.72 points or 1.60% to 3,529.66, KLSE Composite was up 3.78 points or 0.28% to 1,367.98, Nikkei 225 was up 14.37 points or 0.17% to 8,624.32, Seoul Composite was up 1.65 points or 0.10% to 1,737.36 and Taiwan Weighted was up by 21.17 points or 0.30% to 7,111.12.
On the flip side, Hang Seng was down 163.24 points or 0.90% to 17,967.31 and Straits Times was down by 16.88 points or 0.62% to 2,709.03.

Tuesday, September 27, 2011

MARKETS REBOUND IN STYLE

After four straight sessions of horrendous performances, Indian benchmark equity indices finally showed great enthusiasm as market bulls eagerly waited for some significant upside triggers to cover the huge pile of short positions that got build up through the September futures and options series. The frontline indices surged on large volumes as risk appetite of investors, improved globally and they resorted to hefty bottom fishing after the recent brutal assault in equity markets. The key gauges registered colossal gains of almost three percent on the pullback rally following steep global upmoves after a likely bailout plan for Europe caught bears on the wrong foot. Marketmen turned sanguine on expectations that the European leaders and policy makers would get their act together to tackle Greece's debt woes and prevent another full-blown banking crisis. Reports indicated that EU policy makers had plans to use the EU rescue fund to recapitalize vulnerable euro-zone banks. On the global front, the European counterparts got off to a flying start and the benchmarks there are trading with strong gains in the range of 2.50% - 4% while the Asian markets too whole-heartedly participated in the rally and the major gainers from the region were Seoul Composite and Jakarta Composite which jumped 5.02% and 4.76% respectively. Back home, despite the sharp run-up market participants did not seemed completely convinced with the relief rally as they believed that the gains in the session were only build on hopes of a resolution to lingering Euro-zone debt problem but the outlook still remained cloudy as nothing has changed on the horizon as yet. However optimists were of the belief that a good monsoon and the dramatic decline in commodity prices may bode well for the markets in the time to come as it may ease inflationary pressure on Asia's third largest economy which would be followed by a peaking of the interest rate cycle.
Earlier on Dalal Street, the benchmark got off to a gap-up start as the indices sailed past the psychological 4,900 and 16,250 levels in the early trade since investors largely remained influenced by the sanguine sentiments prevailing in Asian markets. Post the smart start the indices just didn't have to look back through the session as they kept moving from strength to strength with the support of encouraging global leads. The northbound journey only came to a halt with the end of the trading session which helped benchmarks in snapping the four session declining streak with massive gains. Eventually the NSE's 50-share broadly followed index Nifty, accumulated triple digit gains to settle just below the crucial 5,000 support level while Bombay Stock Exchange's Sensitive Index, Sensex amassed close to five hundred points and closed above the psychological 16,500 mark. Moreover, the broader markets too traded with strong gains in the session but lacked the fervor with which their larger peers rallied. On the BSE sectoral space, the high beta Realty pocket topped the gainers' chart with handsome gains of over four and half a percent as major developers like DLF, HDIL and Unitech garnered a lot of traction. The information technology counter too witnessed hefty buying interests as the rupee depreciated by around 8% in the last quarter which helped boost the companies' margins. Shares of IT bellwethers like Infosys and TCS rallied by almost 4% in the session. Among individuals, index heavyweight Reliance Industries made its presence felt in the session as it rocketed by over five percent after being butchered by over nine percent in the previous three sessions. The markets soared on weaker volumes of over Rs 1.78 lakh crore while the turnover for NSE F&O segment too remained on the lower side as compared to Monday at over 1.66 lakh core despite this being the second day of September series F&O expiry week. The market breadth remained optimistic as there were 1873 shares on the gaining side against 952 shares on the losing side while 108 shares remained unchanged.
Finally, the BSE Sensex surged 472.93 points or 2.95% to settle at 16,524.03, while the S&P CNX Nifty climbed by 135.85 points or 2.81% to close at 4,971.25.
The BSE Sensex touched a high and a low of 16,551.65 and 16,282.74 respectively. The BSE Mid cap and Small cap index were up by 1.60% and 1.36% respectively.
The major gainers on the Sensex were DLF up 8.46%, Jaiprakash Associate up 5.93%, Tata Motors up 5.92%, Reliance up 5.09% and Hindalco Industries up 4.26%. While, Cipla down 0.28% was the only loser on the index.
The top gainers on the BSE sectoral space was Realty up 4.66%, IT up 3.56%, Oil & Gas up 3.47%, TECk up 3.02% and Consumer Durables (CD) up 2.82%. There was no loser on BSE sectoral space.
Meanwhile, in order to attract more foreign fund at the time of global slowdown, the Reserve Bank of India (RBI) relaxed the norms for the infrastructure companies with direct foreign equity up to 25% to raise funds in aboard without government's permission. In a statement the RBI said, on a review, it has been decided, to further liberalize the External Commercial Borrowings (ECBs) policy in respect of the infrastructure sector.
The RBI allowed direct foreign equity holder which is holding at least 25% of the paid-up capital and indirect foreign equity holder holding minimum of 51% of the paid-up capital, to provide credit enhancement for the domestic debt raise by the Indian firms engaged exclusively in the development of infrastructure via issue of capital market instruments.
It includes Infrastructure Finance Companies (IFCs) and no prior approval will be required from the RBI for providing such credit enhancements, RBI said. The company meeting foreign equity criteria will not require permission for raising ECB up to $5 million.
Now onwards the term debt in the debt-equity ratio will be replaced with ECB liability and the ratio will be known as ECB liability-equity ratio to make the term signify true position as other borrowings or debt are not considered in working out this ratio, RBI noted. Service sector units, in addition to those in hotels, hospitals and software, could also be considered as eligible borrowers if the loan is obtained from foreign equity holders, RBI's notification said. By adding further it says this would facilitate borrowing by training institutions, R&D, miscellaneous service companies, etc. ECB from a group company may also be permitted provided both the borrower and the foreign lender are subsidiaries of the same parent, it added.
The S&P CNX Nifty touched high and low of 4,982.95 and 4,905.15, respectively.
The top gainers on the Nifty were DLF up 7.82%, Tata Motors up 6.64%, JP Associate up 5.99%, Reliance up 5.20%, and Tata Power up 4.75%. On the flip side, Cipla down 0.47% and BPCL down 0.11% were the top losers on the index.
The European markets were trading in the green. France's CAC 40 climbed by 3.95%, Britain's FTSE soared by 2.33%, and Germany's DAX higher by 3.40%.
After witnessing bloodbath in previous session, all the Asian counterparts bounced back and ended the terrific day of trade with a decent gain after a pledge by European officials to resolve the region's debt problems helped soothe market sentiment. Investor's sentiment improved after European ministers told a meeting of global finance leaders in Washington over the weekend that they would take bolder and more decisive steps to pull Greece back from the brink of bankruptcy.The country has only enough money to last until mid-October. Moreover, financial stocks were buoyed by hopes that a plan was in the works to prevent Greece from defaulting on its debts - an event that might crush banks with significant holdings of the country's bonds and cause domino-style defaults in other indebted countries such as Italy.

RALLY CONTINUES

Indian equity markets extended the early gains and trading near high point of day in the late morning trades following gains across Asia. Sensex sees triple digit rally, while Nifty gained more than 100 points. Investors sentiments were strengthen amid expectations that the policy makers in Europe will support the Euro-zone financial system. Eurozone officials are planning for a European investment bank already in existence to use special purpose vehicles to issue bonds that would help finance the purchase of debt. On sectoral front all indices were trading positive. Realty, consumer durables, bank, IT and metal stocks were mostly up with sharp gains. A number of stocks from oil, TECk, power, capital goods and automobile sectors too rallied sharply. FMCG and healthcare stocks were trading firm as well. Reliance Capital surged 3% as founder Anil Ambani said he would consider bonus issue and special dividend for company. On the global front, Asian markets were trading green. Back home, the market breadth favoring the positive trend; there were 1,770 shares on the gaining side against 626 shares on the losing side while 83 shares remained unchanged.
The BSE is currently trading at 16,402.61, up by 351.51 points or 2.19%. The index has touched a high and low of 16,405.38 and 16,282.74 respectively. There were 29 stocks advancing against just 1 decline on the index.
The broader indices too were performing well; the BSE Mid cap and Small cap indices captured gains of 1.72% and 1.60% respectively.
All sectoral indices were trading positive. The top gaining sectoral indices on the BSE were, Realty up by 2.96%, CD up by 2.84%, Bankex up by 2.54%, IT up by 2.35% and Metal up by 2.23%.
The top gainers on the Sensex were Jaiprakash Associate up by 5.64%, Tata Motors up by 5.17%, DLF up by 3.82%, ICICI Bank up by 3.63% and Sterlite Industries up by 3.58%. The only loser on the Sensex was Sun Pharma down by 0.21%.
Meanwhile, D Subbarao, justifying the Reserve Bank of India's monetary policy stance on the hovering inflation, said that the inflation at around 9% is inimical to growth.
The RBI Governor said that while modest inflation can help boost growth, rapid growth in price pressures requires tighter monetary policy. The headline inflation has been hovering around 9% from last nine months. The headline inflation measured by the Wholesale Price Index (WPI) stood at 9.78% for the month of August from 9.22% in last month.
In order to cap inflation RBI has increased its key policy rates by 12 times in last 18 months. Due to increased interest rates the investment activities have been declined as a result affecting the pace of Economic growth.
'If inflation is below 6% , there's probably an argument that we can tolerate a bit of higher inflation, but when it is around 9%, as it is (in India), we are way past the threshold,' Subbarao said. 'There is no question, inflation is inimical to growth," he added.
On the issue of current global economy situation, Subbarao said that the policymakers around the world lack the monetary and fiscal fire power they possessed in 2008 to fight a renewed global slowdown. Central banks and governments today 'have no fire power left: governments cannot raise fiscal stimulus and central banks have exhausted most conventional and unconventional' policies,' he added.
On the issue of the growth in emerging and slowdown in developed economies, the RBI Governor said, is the different stages of the business cycle seen in major world economies. Emerging markets such as India are still growing at a healthy clip while Europe, Japan and the United States are growing more slowly.
The S&P CNX Nifty is currently trading at 4,942.30, higher by 106.90 points or 2.21%. The index has touched a high and low of 4,942.70 and 4,905.15 respectively. 49 stocks were advancing against 1 declining one on the index.
The top gainers of the Nifty were Tata Motors up by 5.76%, JP Associates up by 5.49%, Reliance Capital up by 4.56%, Hindalco up by 3.77% and Cairn up by 3.60%. Meanwhile, Sun Pharma down by 0.07% was the lone loser on the index.
All the Asian equity indices were trading in the green; Shanghai Composite was up by 0.83%, Hang Seng was up by 2.91%, Jakarta Composite was up by 4.34%, KLSE Composite was up by 1.62%, Nikkei 225 was up by 2.34%, Straits Times was up by 1.70%, Seoul Composite was up by 4.91% and Taiwan Weighted was up by 3.09%.

POSITIVE MOOD

Indian equity markets have sustained their ebullient mood witnessed in early trade after a pledge by European officials to resolve the region's debt problems helped soothe market sentiment. Local equity markets vigorously rebounded after a three-day losing streak owing to the fresh spell of buying by funds and retail investors in recently beaten-down stocks, driven by a firming trend on the other Asian bourses following overnight gains in the US. In contrast to weeks of indecision, European ministers told a meeting of global finance leaders in Washington over the weekend that they would take bolder steps to fight the debt crisis. Meanwhile, on Monday, President Barack Obama called on Europe's leadership to move more quickly to address the problems, which led to biggest gains in more than two weeks at Wall Street. S&P's second biggest one-day rally in September - was driven by defensive "blue-chip" names, with the Dow Jones Industrial Average up 2.5%. Meanwhile, the US future indices too were showing an uptick in the screen trade. Back home, frenzied selling was witnessed across the board, however, the stocks from Consumer Durable, Realty and Bankex counters scurried the most for the bourses splendid gains. In addition to this, covering-up of short positions ahead of monthly expiry in the derivatives segment on Thursday also helped stocks to recover. The 30 scrip sensitive index- Sensex- trading above 16300 level, had puffed up gains of over 250 points. Meanwhile, the broadly followed 50 share index- Nifty-gaining over 75 points was trading above 4900 level. The broader indices too were performing well for themselves and were trading above 1%. The overall market breadth on BSE is in the favour of advances which thumped declines in the ratio of 1573:476, while 71 shares remained unchanged.
The BSE is currently trading at 16,337.83, up by 286.73 points or 1.79%. The index has touched a high and low of 16,360.26 and 16,282.74 respectively. All the 30 stocks were advancing on the index at this point of time.
The broader indices too were performing well; the BSE Mid cap and Small cap indices captured gains of 1.45% and 1.47% respectively.
Buying was witnessed across the board, however, the top gaining sectoral indices on the BSE were, CD up by 2.88%, Realty up by 2.84%, Bankex up by 2.09%, IT up by 2.05% and TECk up by 1.85%.
The top gainers on the Sensex were Tata Motors up by 3.95%, Jaiprakash Associates up by 3.84%, DLF up by 3.59%, Sterlite Industries up by 2.86% and ICICI Bank up by 2.81%.
Meanwhile, order to lift the market sentiments, government is considering a cut in the Securities Transaction Tax (STT), along with this, the Ministry of Finance is also mulling a rationalized and uniform stamp duty on securities transactions. This move of the government has been welcomed by the market, which has been under pressure because of the global uncertainties. However, the recommendation is still under consideration. The Bombay Stock Exchange (BSE) benchmark index Sensex recovered around 250 points from the day lowest and closed to 16,051.10, although, Sensex was below 110.96 points compare to last Friday. A senior finance ministry official said, 'we are seriously looking into the proposal (reducing STT). This can be done outside the Budget.' The decision of cutting the STT is backed by the rationale that the tax has not generated much revenue. In first five months of current financial year, the government generated around Rs 2,223 crore from STT, which is almost 10% less than the last financial year.
The STT was introduced in 2004-05, when P Chidambaram was Finance Minister, the STT is charged on sales/purchase of share, equity-oriented mutual funds and futures and options in securities. The recommendation of cutting or removing the STT came up in the meeting between the finance ministry and Stock Exchanges. It was said that this tax constituted a major component of the transaction cost. Due to the high cost and to make trading more attractive, there was need to reduce or remove the tax, the exchanges are believed to have said in the meeting.
In the same time, the ministry of finance is making the draft to present a proposal before cabinet for rationalizing stamp duty. This also involves removing the rates in some states. Finance Ministry official said, 'two departments of the Ministry, Economic Affairs (responsible for development of capital market) and Revenue (responsible for taxation) have finalized various provisions. Now, Finance Minister, Pranab Mukherjee, will take a final call and then the proposal will be taken to the Cabinet.'
As stamp duty is the state matter, the discussions are also going on with the states. The stamp duties vary from state to state, the effort is to define a uniform rate and persuade the states to fix it accordingly. Maharashtra has the highest stamp duty collection with 42% of total inflows. It charges at the rate of 0.002% on the non-delivery-based and 0.01% on delivery-based. 
The S&P CNX Nifty is currently trading at 4,918.85, higher by 83.45 points or 1.73%. The index has touched a high and low of 4,928.30 and 4,905.15 respectively. 47 stocks were advancing against 3 declining one's on the index.
The top gainers of the Nifty were Tata Motors up by 3.99%, JP Associates up by 3.75%, Cairn India up by 3.34%, DLF up by 3.18% and Tata Power up by 2.99%.
Meanwhile, ACC down by 0.41%, Sesa Goa down by 0.18% and Cipla down by 0.03% were the losers on the index.
All the Asian equity indices were trading in the green; Shanghai Composite was up by 0.30%, Hang Seng was up by 2.40%, Jakarta Composite was up by 4.34%, KLSE Composite was up by 1.62%, Nikkei 225 was up by 1.91%, Straits Times was up by 1.39%, Seoul Composite was up by 3.68% and Taiwan Weighted was up by 2.74%.

Monday, September 26, 2011

RECOVERY

Indian frontline equity indices have gone on to recover some part of ground lost in the session after touching intraday lows in late morning trades. There appeared some tentative recovery in investors' sentiments as they tracked European equity markets which swiftly recuperated and surged by around a percent gains after a somber opening with large cuts of around one and half a percent. The local benchmarks too have regained the psychological 4,800 (Nifty) and 16,000 (Sensex) levels despite the bleak leads that Asian peers are exhibiting which is evident from the fact that most benchmarks in the region suffered nasty cuts especially Indonesia which got bludgeoned by over 5%. Marketmen lacked the conviction to initiate fresh positions in morning trades as Euro-zone leaders and policy makers struggled to find a plan to solve the crisis. On the domestic front, sentiments also got some support from reports that the finance ministry may consider a cut in securities transaction tax (STT) and propose a concession on stamp duty on equities. On the sectoral front, all the gauges traded in the negative territory with indices like Consumer Durables and Metal suffering nasty lacerations in the range of 3-5%. Though there were no secotral gainers, some recovery was seen in IT stocks while among individual gainers, Wipro, Bharti Airtel and ICICI Bank gained some traction.
Moreover, the broader markets too plummeted in afternoon trades after showing some positive moves in early part of the session and currently trading with large cuts of over two percent. The bourses declined on very large volumes of over Rs 1 lakh core while the market breadth on BSE was dominantly in favor of declines in the ratio of 2066:486 while 76 scrips remained unchanged.
The BSE Sensex is currently trading at 15,956.34 down by 205.72 points or 1.27% after trading as high as 16,209.19 and as low as 15,801.01. There were 3 stocks advancing against 27 declines on the index.
The broader indices were trading on a somber note; the BSE Mid cap index plunged 2.07% and Small cap sank 2.09%.
On the BSE sectoral space there were no gainers while Consumer Durables down 5.17%, Metal down 3.42%, CG down 2.10%, PSU down 2.06% and Oil & Gas down 1.86% were the major losers on the index.
Wipro up 0.91%, Bharti Airtel up 0.36% and ICICI Bank up 0.15% were the only gainers on the Sensex, while Coal India down by 5.60%, Sterlite down 4.44%, Hindalco down 4.36%, Hero Moto down 2.47% and L&T down 2.22% were the major losers on the index.
Meanwhile, India and China at their first comprehensive Strategic Economic Dialogue (SED), have reached to an understanding to deepen their bilateral investment cooperation, by opening their domestic market for each other and improve the investment environment. 
The high level delegations led by Montek Singh Ahluwalia Deputy Chairman Planning Commission (India), and Zhang Ping Chairman, National Development and Reform Commission (China) had very optimistic successful dialogue on stepping up cooperation and coordination on a host of economic issues.
Both the nations have agreed to stay committed to deepening bilateral investment cooperation, further opening markets and improving the investment environment in both the nations to put down a strong foundation for pragmatic cooperation between the businesses of the both the economic power houses on the basis of complementarities, mutual benefits and win-win outcome.
In order to promote sustainable development, along with the businesses and investment cooperation, both the economies agreed to strengthen their cooperation on energy efficiency and conservation as well as on environment protection. India and China also agreed to speed up the cooperation on energy, including the removable energy sector.  
Given the current global economic situation, increased exchanges in these spheres would provide additional opportunities to grow the businesses activities, and new engine for greater cooperation between the two sides, the SED minutes said.
The S&P CNX Nifty is currently trading at 4,796.45, lower by 71.30 points or 1.47% after trading as high as 4,879.80 and as low as 4,758.85. There were 3 stocks advancing against 47 declines on the index.
The top gainers on the Nifty were Wipro up 0.50%, Bharti Airtel up 0.45% and ICICI Bank up 0.07%.
Cairn down 4.87%, Sterlite down 4.73%, Hindalco down 4.30%, Axis Bank down 3.94% and R Power down 3.18% were the major losers on the index.
Asian markets traded on a depressing note, Shanghai Composite plunged 1.74%, Hang Seng got decimated 3.25%, Jakarta Composite got bludgeoned by 5.82%, KLSE Composite nosedived 3.33%, Nikkei 225 got butchered by 2.15%, Straits Times slumped 2.46%, Seoul Composite deposed 2.64% and Taiwan Weighted shaved off 2.40%.
The European markets traded on a bleak note as France's CAC 40 plunged 1.60%, Germany's DAX sank 1.20% and Britain's FTSE 100 shaved off 1.33%

FALL CONTINUES

The Indian equity markets have made a positive start, but immediately turned into red terrain tracking weakness in Asian counterparts. All the Asian peers were trading in the negative territory at this point of time, indicating somber investors' sentiment. Though, the US markets managed a close of modest gains on Friday but the mood remained cautious amid the European debt concerns. Back home, on the sectoral front software, technology and power remained the top gainers while, metal, consumer durables and oil and gas witnessed the most selling pressure, dragging down the Sensex. Meanwhile, IT space was witnessing some buying in early trade. A fall in Indian rupee has been pushing up IT stocks in recent times because most IT firms earn a large part of their revenues in dollars. However, PG Electroplast, the new listing today, was trading with a cut of over four percent. Moreover, the broader indices too were struggling to get some traction and trading flat at this point of time while, the market breadth on the BSE was positive; there were 1,014 shares on the gaining side against 765 shares on the losing side while 73 shares remained unchanged. Trade may remain volatile today as it being the expiry day for the September F&O series.
The BSE Sensex opened at 16,209.19; about 47 points higher compared to its previous closing of 16,162.06, and has touched a low of 16,039.89 while high remained its opening.
The index is currently trading at 16,075.78 down by 86.28 points or 0.53%. There were 9 stocks advancing against 21 declines on the index.
The overall market breadth has made a positive start with 54.75% stocks advancing against 41.31% declines. The broader indices were trading mixed; the BSE Mid cap index down by 0.09% while, Small cap index up by 0.26%.
The top gaining sectoral indices on the BSE were, IT up by 0.31%, TECk up by 0.17% and Power up by 0.05%. While, Metal down by 1.90%, CD down by 1.05%, Oil and Gas down by 0.93%, CG down by 0.73% and Bankex down by 0.68% were the top losers on the index.
The top gainers on the Sensex were Tata Power up by 2.24%, Maruti Suzuki up by 1.96%, Wipro up by 1.95%, Cipla up by 0.83% and TCS was up by 0.43%.
On the flip side, Sterlite Industries was down by 3.38%, Hindalco was down by 2.61%, Bajaj Auto was down by 2.13%, Coal India was down by 1.82% and HDFC Bank was down by 1.58% were the top losers on the Sensex.
Meanwhile, the decline in coal production by India's largest coal producer - Coal India, is expected to adversely affect the capacity utilization of the power projects, G B Pradhan special secretary in the ministry of power said, 'Coal India may have a slightly flat or even a negative growth. We will have to do with less.' However, he indicated that the National Thermal Power Corporation (NTPC) may achieve its target Plant Load Factors (PLFs) at 85-87%, but the new capacities which will be set-up by private sector may face the shortage of the coal. 
G B Pradhan said, 'the initial plant load factors of private sector power plants could be as low as 50-60%.' For the current financial year the average plant load factors is expected to be around 75%. The power ministry is also doing an extensive review of case one and case two bid documents. Some of the matters that will be addressed for future projects and agreements will tackle matters such as pass through of fuel cost increase, which has become a serious concern for two ultra mega power projects in Mundra and Krishanpatnam.
Recently, the Indonesian government indexed its coal sales to international prices, because which, the viability of these bids have undergone a change. 'We will also address issues like the timeline for power purchase agreements. Should they be as long as 25 years..' said Pradhan. The review of case one and case two bids is expected to be finish in two to three weeks.
On the issue of coal shortage, the Union Coal Minister Sriprakash Jaiswal said, Coal India had not been able to increase its capacity as per its target. 'We have set high targets for ourselves. Considering the problems we have been having, it is praiseworthy that we are able to stabilize production.' During 2010-11 Coal India's production has declined by 7%, whereas for the current financial year, production is expected to be flat. However, the Coal Minister expects coal production to increase its production by 7% in 2012-13.
The S&P CNX Nifty opened at 4,878.60; about 11 points higher compared to its previous closing of 4,867.75, and has touched a high and a low of 4,879.80 and 4,832.15 respectively.
The index is currently trading at 4,843.75, lower by 24.00 points or 0.49%. There were 16 stocks advancing against 34 declines on the index.
The top gainers of the Nifty were Wipro up by 1.78%, Maruti up by 1.62%, Cipla up by 0.72%, SAIL up by 0.62% and TCS up by 0.47%.
On the flip side, Sterlite Industries down by 3.51%, Hindalco down by 2.76%, Sesa Goa down by 2.32%, Bajaj Auto down by 2.31% and Cairn down by 2.00%, were the major losers on the index.
All the Asian equity indices were trading in the red; Shanghai Composite was down 12.07 points or 0.50% to 2,421.09, Hang Seng was down 316.83 points or 1.79% to 17,352.00, Jakarta Composite was down 156.67 points or 4.57% to 3,269.67, KLSE Composite was down 38.81 points or 2.84% to 1,327.13, Nikkei 225 was down 159.97 points or 1.87% to 8,400.29, Straits Times was down 44.47 points or 1.65% to 2,654.33, Seoul Composite was down 14.78 points or 0.87% to 1,682.66 and Taiwan Weighted was down by 96.98 points or 1.38% to 6,949.24.

Sunday, September 25, 2011

TREND FOR 26th SEPTEMBER

Markets continue to be in negative zone with depressing global factors & are below 5 & 10 EMA, thus the Nifty is likely to slip to 4720, whereas on the upside it may move up to 4981. Long positions should be avoided till some the markets are stable, compulsive traders can take positions in CONCOR for a target of 988, DISHTV for a target of 84, IOC for a target of 324, RPOWER for a target of 98.

                                                                      CHEERS !!!

Saturday, September 24, 2011

UNDER THE GLOBAL TREMORS

The carnage in Indian stock markets prolonged for yet another session as the benchmarks continued to sway to the tune of depressing global developments and deposed another over a percentage point on the last trading session of the week. The session was characterized by extreme volatility as the frontline indices went through a rollercoaster ride amid lack of direction and a pandemonium across global equity markets. Marketmen looked at every rise as opportunity to take profits off the table as there emerged no encouraging factor that could halt the unrelenting selling pressure. With deteriorating situation in the US and Europe and fresh worries over a global economic recession after disappointing Chinese and European factory output data investors were left with the only option to take cash off the table and sit on the sidelines until something really revitalizing happens. Meanwhile, investors were seen covering lot of short positions in afternoon trades after some pessimism got petered out on the back of strong European market opening. The brief optimism in sentiments came after the Group of 20 finance ministers and central bank Governors reassured markets that they would take all necessary measure to preserve financial stability and increase the flexibility of the euro zone's rescue fund. However, the recovery proved short-lived and the markets weakened again, as inflation and rate hike worries prompted investors to cut positions ahead of the weekend. The upside chances for the local markets remained scanty as a pledge by Group of 20 nations to tackle rising risks failed to ease concern that the global economy is on the brink of another recession. Also, Asian peers continued to undermine local sentiments by exhibiting somber trends, evident from the fact that benchmarks in countries like South Korea and Taiwan ended with large cuts of 5.73% and 3.55% respectively. Meanwhile, market participants were also troubled a lot by the high volatility in Indian rupee which appreciated in the second half of trade to 49.15, though in the morning trade, it depreciated to 49.77 per dollar. Deputy Governor Subir Gokar commenting on rupee's recent declining run opined that the RBI will maintain its stance of intervening in the foreign exchange market only to smoothen volatility.
Earlier on Dalal Street, the benchmark got off to a gap down opening, in tandem with the somber sentiments prevailing in Asian markets. Thereafter, the frontline indices tried to pare the early losses and crawled towards the neutral line. But the key gauges could not succeed as selling pressure at higher levels brought the indices to intraday lows in late morning session. Benchmarks once again treaded on the road to recovery in afternoon and even managed to break into the green territory but only for a brief period as fresh bouts of profit booking again brought the indices to lower levels by the end of trade. Eventually the NSE's 50-share broadly followed index Nifty, suffered a nasty over a percent laceration to settle above the crucial 4,850 support level while Bombay Stock Exchange's Sensitive Index Sensex got obliterated by about two hundred points and closed above the psychological 16,150 mark. Moreover, the broader markets too failed to show any kind of fervor and settled with large cuts of around a percent. On the BSE sectoral space, metal, capital goods and rate sensitive counters did the maximum damage as they went home with huge losses. However, information technology pocket showed some resilience for most part of the session and attracted buying interests since rupee depreciated considerably against the American greenback, but finally settled with marginal losses. The defensive FMCG counter along with some oil and gas stocks like ONGC and BPCL did their bit to prevent the frontline indices from dipping deeper into the red terrain. The markets got bludgeoned on extremely large volumes of over Rs 2.14 lakh crore while the turnover for NSE F&O segment too remained higher as compared to Thursday at over 1.99 lakh crore. The market breadth remained awful as there were 986 shares on the gaining side against 1805 shares on the losing side while 105 shares remained unchanged.
Finally, the BSE Sensex shaved off 199.09 points or 1.22% to settle at 16,162.06, while the S&P CNX Nifty plunged by 55.90 points or 1.14% to close at 4,867.75.
The BSE Sensex touched a high and a low of 16,368.41 and 16,052.47 respectively. The BSE Mid cap and Small cap index were down by 0.84% and 1.13% respectively.
The major gainers on the Sensex were Cipla up 2.09%, Tata Power up 1.37%, SBI up 1.03%, Bharti Airtel up 0.77% and Jaiprakash Associate up 0.67%. While, Tata Motors down 4.81%, Hindalco Industries down by 3.77%, HDFC Bank down by 3.10%, HDFC down by 2.82% and L&T down 2.70% were the major losers on the index.
The only gainer on the BSE sectoral space was FMCG up 0.15%.While, the top losers were Metal down 2.28%, Capital Goods (CG) down 1.84%, Auto down 1.59%, Consumer Durables (CD) down 1.44% and Bankex down 1.35%.
Meanwhile, Finance Minister Pranab Mukherjee warned international community that if the current uncertainty in the international economy deepens, then there is danger of currency war. Giving the stress on corporation among the BRICS nations (Brazil, Russia, India, China and South Africa), finance minister said that such a currency war can be avoided through dialogue and not through competitive devaluations.
Answering to the question at the headquarters of the International Monetary Fund (IMF), Mukherjee said, 'yes, if the crisis deepens further and there is greater volatility in financial flows, there is an increased risk of this (currency war) happening. 'But our view is that if such tensions arise, it should be eased through the dialogue and not through competitive devaluations,' he added.
Finance Minister noted that the currencies used in BRICS countries should be widely appreciated and should be taken into account while determining the ingredients of special drawing rights (SDR) maintained by the IMF, as these nations' contributions to global output and the economy is increasingly substantially.
However, by adding further he said, 'but we are not suggesting right now, because there are many other factors which ought to be taken into account, including free convertibility and other things which are not uniform, but the importance of these currencies has increased.' Finance minister's comment has come at a time when Indian rupee is depreciating because of the debt crisis in US and Eurozone nations. The rupee weakened to 50 against the dollar on September 23, a level not seen in more than 28-months, as investors globally continued to dump high yielding riskier assets for the safety of government bonds.    The S&P CNX Nifty touched high and low of 4,930.25 and 4,829.60, respectively.
The top gainers on the Nifty were Reliance Power up 3.37%, Cipla up 2.09%, Grasim up 2.02%, Reliance Capital up 1.61%, and Tata Power 1.47%. On the flip side, Tata Motors down 5.37%, Hindalco Industries down 4.02%, SAIL down 3.48%, HDFC Bank down 3.45% and Cairn down 3.42% were the top losers on the index.
The European markets were trading in the red. France's CAC 40 climbed by 2.40%, Britain's FTSE lost by 1.41%, and Germany's DAX declined by 2.26%.
All the Asian equity indices barring Jakarta Composite continued their downfall for second straight day amid growing fears that the global economy is on the verge of slipping back into recession. The sell-off followed heavy losses in the United States and Europe overnight, which were caused by the Federal Reserve's comments on Wednesday that the US economy faced 'significant downside risks', with the economy struggling with slow growth, high unemployment and a depressed housing market. However, most markets were off their earlier lows after G20 finance chiefs meeting in Washington promised to take collective action to stabilize the financial system. Moreover, Hong Kong shares had their worst week since October 2008, losing 9.2 percent as escalating fears of a global recession caused investors to cut riskier holdings.