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Nifty listless, tests 5900 levels: Top ten stocks in focus

Sep 252013
 

 

Nifty listless, tests 5900 levels: Top ten stocks in focusNEW DELHI: The 50-share Nifty index turned choppy after opening on a flat-to-positive note on Wednesday ahead of the September series expiry. Gains in realty, capital goods and auto sectors were offset by losses in banks, technology and oil & gas stocks.

According to dealers, the trade is likely to remain choppy in absence of cues from global peers and as traders square-off open positions.

At 10:05 a.m.; the 30-share index was at 19,932.18, up 12 points or 0.06 per cent. It touched a high of 19,978.49 and a low of 19,897.15 in early trade.

The Nifty was at 5,891.95, down 1.5 points or 0.01 per cent. The index touched intraday high of 5,910.40 and a low of 5,885.45.

“The Nifty is expected get support around 5855 and resistance will be at 5935,” said Somil Mehta, Senior Tech Analyst (Equity) at Sharekhan.

“The Nifty has completed a five-wave pattern from 5118 to 6142 and is now expected to retrace the entire rally till the 40-weekly moving average (WMA), ie 5755,” he added.

Mehta is of the view that the short term bias for the Nifty remains negative for a target of 5755 with reversal around 6150.

The medium-term outlook remains positive because the Nifty has retraced 61.8% of the previous rally from 4770 to 6229 and is trading above the 20-WMA and the 40-WMA, ie 5822 and 5755 respectively, he added.

Here is a list of ten stocks which are in focus in trade today:-

Tata Motors Ltd: Tata Motors-owned Jaguar Land Rover (JLR) today announced a multi-million-pound investment in research and development in the UK that will be focused on a state-of-the-art centre at the University of Warwick campus.

At 10:05 a.m.; the stock was trading 2.4 per cent higher at Rs 344.75.

Tata Consultancy Services Ltd: TCS said it would set up an all-women business processes outsourcing centre in Saudi Arabia, a conservative Islamic nation where women must be accompanied by a male relative when in public and are not allowed to drive.

At 10:05 a.m.; the stock was trading 0.6 per cent lower at Rs 1,927.75.

Hexaware Technologies Ltd: Approving one of the biggest deals in the Indian IT space, fair trade watchdog CCI has cleared Baring Private Equity’s proposed acquisition of controlling stake in outsourcing firm Hexaware Technologies, saying the transaction will not adversely impact competition.

At 10:05 a.m.; the stock was trading 1.4 per cent higher at Rs 128.65.

Kingfisher Airlines Ltd: Criris-hit KFA said it is in talks with a foreign investor for potential stake sale, its Chairman Vijay Mallya said on Tuesday. The stock gained nearly 10 per cent on Tuesday and is likely to see further traction on Wednesday.

At 10:05 a.m.; the stock was trading 9.9 per cent higher at Rs 5.65.

Ashoka Buildcon Ltd: The company said it has received orders valued at Rs 494.50 crore from Maharashtra State Electricity Company Ltd (MSEDCL).

At 10:05 a.m.; the stock was trading 3.6 per cent higher at Rs 46.65.

Fertiliser stocks: The total fertiliser subsidy budget for the fiscal 2013-14 is anticpated to be in the range of Rs 65,000-70,000 crore excluding carryover subsidy of last years, a ratings agency said in a report.

At 10:05 a.m.; Coromadel International Ltd was trading 0.1 per cent higher at Rs 221.05.

Financial Technologies Ltd: Just a day before Financial Technologies (FT), the MCX Group’s flagship company, planned to meet its shareholders at the annual general meeting in Mumbai, its auditor Deloitte Haskins and Sells has withdrawn its audit report saying that the company’s standalone and consolidated results are not to be relied upon.

At 10:05 a.m.; the stock was trading 5.6 per cent lower at Rs 157.80.

Unitech Ltd: The world’s largest property investor, Blackstone, has agreed to buy out a 3.6-million-sqft IT SEZ in Gurgaon, partly owned by Unitech, for 2,600 crore.
At 10:05 a.m.; the stock was trading 0.9 per cent higher at Rs 16.85.

SAIL: State-owned steelmaker SAIL has tied up with Siemens to upgrade the technical competence of its work force. Siemens will offer training in automation, DC/AC servo drives, switchgears and other related technologies such as process instrumentation and mechatronics at the steel major’s units in Bhilai, Bokaro, Durgapur, Rourkela, Burnpur, Salem, Bhadravati and Kolkata.

At 10:05 a.m.; the stock was trading 0.4 per cent lower at Rs 52.20.

Hindustan Motors Ltd: Crisis-ridden Hindustan Motors, a C K Birla group company, is gearing up for the launch of a small car in the next fiscal, its MD and CEO Uttam Bose said on Tuesday.

At 10:05 a.m.; the stock was trading 1.4 per cent higher at Rs 8.67.

 

After food bill, Congress banks on land legislation to woo poor

Aug 292013
 

After food bill, Congress banks on land legislation to woo poorNEW DELHI: Congress is looking to notch back-to-back successes on ‘aam aadmi’ plank, with the vexed land bill likely to be passed in Lok Sabha on Thursday, three days after the ruling camp clinched the food security legislation amplifying the rhetoric of inclusive growth.

The overhaul of the land acquisition law of 1894 seeks to check government’s power to take over private land, resulting from rising confrontation between owners and the state. The Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Bill, 2012 is widely perceived to be necessary in order to get rid of an antiquated law which allowed governments to acquire increasingly scarce land for a pittance to be handed over to business houses to set up industries.

Lack of transparency facilitated corruption: a reason for heartburn among farmers and landowners which triggered confrontations across the country.

The pressure for a revamp of the century-old law escalated in the wake of the acquisition of land for SEZs in UPA-1, forcing Congress to think of measures to protect its pro-farmer credentials.

The bid to allay the concerns of farmers has, however, led to apprehension about some provisions of the bill. The clause requiring consent of 80% of landowners for private projects and 70% in the case of private public partnership projects has sparked fear that acquiring land may become difficult, if not impossible. The timing of the bill, with rupee along with growth parameters sliding, have only deepened the worry.

However, this has not detained the government which has framed the legislation as part of its New Deal for farmers supposedly at the receiving end of capricious acquisitions for the benefit of industrial houses. Competition among the political class, just as in the case of food safety bill, is expected to ensure smooth passage of the bill despite opponents being convinced that it would be an addition to Congress’s poll armoury.

Even as they bicker over other legislations, Congress and BJP reached a remarkable understanding to debate and pass the bill on Thursday. Rural development minister Jairam Ramesh facilitated a pact by accepting the suggestions of leader of opposition Sushma Swaraj.

The minister even gave credit to the principal opposition for the deal. “Sushma Swaraj has been a key factor and Rajnath Singh has been a great support in this endeavour,” Ramesh said.

The government is hoping the bill will pass muster in Rajya Sabha too.

But behind the Congress’s eagerness to share credit lies the gameplan to beef up its ‘aam aadmi” credentials, the land bill and food security law being crucial manifesto promises identified with Sonia and Rahul Gandhi.

The bonhomie in Parliament is likely to disappear on the political pitch with Congress set to claim that it has delivered on a pro-rural promise despite serious reservations from industry. It would be a perfect fit for the campaign to position food law as ‘pro-poor” since it has also come under fire from fiscal disciplinarians.

While amendments to the century-old law were proposed five years ago, the land law gained prominence when Rahul espoused the cause of Bhatta Parsaul agitation, and before that Aligarh expressway protests. Congress claimed the land bill would address the harassment of the poor and farmers forced to give up land at meager rates.

Wary of Congress’s game plan, BJP chief Rajnath Singh will open the debate to ensure the opposition is not pushed out of the frame for credits. If Congress and BJP join hands, the opposition to the bill from Left and Trinamool Congress may not matter much.

India rupee sinks to a record low

Aug 292013
 

India rupee sinks to a record low India’s rupee has plunged more than 3.6 percent to a new record low against the US dollar amid deepening economic woes.

The rupee, one of Asia’s worst-performing currencies this year, breached 68.75 against the dollar in morning trade on Wednesday, after sliding three percent a day before.

The rupee has now fallen about 19 percent so far this year, by far the biggest decliner among the Asian currencies tracked by Reuters.

Foreign investors sold nearly $1 billion of Indian shares in the eight sessions through Tuesday – a worrisome prospect given stocks had been the country’s one sturdy source of capital inflows, although net purchases so far this year still total $12bn.

“It is just impossible to put any realistic value to the rupee any more,” said Uday Bhatt, a forex dealer with UCO Bank.

The need to attract foreign capital is critical for a country whose record high current account deficit is a key reason behind the rupee’s slump.

Yet policymakers have consistently struggled to come up with measures that can convince markets they can stabilise the currency and attract funds into the country.

Finance Minister P Chidambaram said on Tuesday the government would need to do more to revive an economy growing at the slowest in a decade and narrow a current account deficit that hit a record high of 4.8 percent of gross domestic product in the year that ended in March.

Fiscal deficit

Those comments came after the government approval of infrastructure projects were overtrumped by concerns about the fiscal deficit after India’s lower house of parliament this week approved a 1.35 trillion rupees plan to provide cheap grain to the poor.

That failure is becoming an increasing source of tension for India at a time when fears of a possible US-led military strike against Syria are knocking down Asian markets, with the prospect that the Federal Reserve will end its period of cheap money as early as next month further raising concerns.

In its latest initiative, the government late on Tuesday proposed setting up a task force to look into currency swap agreements, a measure analysts said could bring some relief if carried out in time by reducing market demand for dollars or other major currencies.

Meanwhile, India’s main NSE index fell more than 2 percent while 10-year bonds yields rose to as high as 9.04 percent.

The benchmark Bombay Stock Exchange index also suffered a sell-off, sinking 2.66 percent.

Indians abroad cash in on rupee’s fall

Aug 272013
 

Indians abroad cash in on rupee's fallThe Indian rupee has been on a decline. It hit an all-time low last week and that has raised plenty of concerns over the health of the nation’s economy.

But there is one group of people who are less likely to complain – Indians working abroad.

The dip in the rupee means that their foreign earnings are worth much more.

And as Puneet Pal Singh reports – it is helping some people to realise their dreams.

India central bank moves to boost liquidity

Aug 212013
 

India central bank moves to boost liquidityIndia’s central bank has said that it will inject 80bn rupees ($1.3bn; £806m) into the country’s banking system by buying long-term government bonds.

It comes just days after the central bank tightened the money supply in an attempt to stem the rupee’s decline.

The move is expected to make more credit available and also bring down borrowing costs for the government.

On Tuesday, the bond yield or the cost of borrowing on India’s 10-year bonds touched 9.48%, the highest since 2001.

The Reserve Bank of India (RBI) said that it was “important to ensure that the liquidity tightening does not harden longer term yields sharply and adversely impact the flow of credit to the productive sectors of the economy”.

The bank said that it will buy the bonds via open market purchase operations (OMOs) on 23 August.

‘Unintended consequences’

India has been grappling with a declining currency. The Indian rupee has fallen nearly 16% against the US dollar since May and is Asia’s worst performing currency so far this year.

On Tuesday, it dropped to an all-time low of 64.13 against the US dollar, before strengthening slightly.

The decline has prompted the central bank to take steps to try to prop-up the currency.

Recently it increased the interest rate at which it lends money to other banks and also put a cap on their daily borrowings.

While the measures had little impact in stemming the rupee’s decline, they did trigger concerns that a tightened credit supply may hurt India’s growth – which has fallen to its lowest level in a decade – even further.

Analysts said that the central bank’s move would not only help allay fears over liquidity but will also help the rupee.

“RBI is trying to ensure that the unintended consequences of their liquidity tightening steps that led to a spike in long-end bond yields are corrected,” said Ashish Parthasarthy, a treasurer at HDFC Bank.

“These measures will bring down 10-year bond yield sharply and will also reduce banks’ depreciation losses significantly.”

NS Venkatesh of IDBI Bank added that the steps “will help the rupee positively” as foreign investors are likely to be attracted back to the Indian debt market on the expectation of falling yields.

India inflation rate rises amid weakening currency

Aug 142013
 

India inflation rate rises amid weakening currencyIndia’s inflation rate rose by more-than-expected in July as a weaker currency brought higher import costs.

India’s main gauge of inflation, the Wholesale Price Index, rose 5.79% from a year earlier, up from 4.86% in June.

The Indian rupee has fallen 10% against the US dollar this year.

Policymakers have taken various steps in recent days to try and stem the rupee’s decline. Analysts said the latest data may see the central bank unveil further measures.

Last month, the Reserve Bank of India (RBI) on Monday hiked the interest rate at which it lends money to other banks and also put a cap on their daily borrowings.

It also tightened reserve ratio requirements for banks to curb the supply of rupees.

‘Risk to growth’

The steps come at a time when India is also seeing a slowdown in its economic growth.

Asia’s third-largest economy grew at an annual rate of 5% in the 2012-13 financial year, the slowest pace in 10 years.

There are concerns that its growth rate may slow further amid slackening growth in the manufacturing sector and declining foreign investment in the country,

That has triggered calls for the central bank to ease some of its policies to try to spur a fresh wave of economic growth.

However, the fall in the rupee’s value has seen the RBI take some monetary tightening measures instead and analysts said that it was unlikely that the bank would alter its stance in the near term.

“The rupee’s fall and high retail inflation have virtually left no room for further monetary easing,” said Daniel Martin, Asia economist at Capital Economics.

Rupa Rege Nitsure, chief economist at Bank of Baroda, added that “the central bank’s focus will remain on currency and financial markets stability, even if that means a further risk to growth”.

Pre-market: Nifty seen opening soft; may test 5750 levels

Jul 042013
 

Pre-market: Nifty seen opening soft; may test 5750 levelsNEW DELHI: The 50-share Nifty index is expected to open soft on Thursday in line with other Asian markets. Tracking the muted momentum, the index is likely to test its crucial support level of 5750 in trade today.

At 07:30 a.m., Nifty India stock futures in Singapore were trading 10 points higher at 5782, indicating a lower opening on the domestic market.

The 50-share Nifty index closed below its crucial support level of 5800 on Wednesday, in line with other global peers. The rise in global crude oil prices and weak rupee weighed on investor sentiments as it impact India’s current account deficit (CAD).

The Nifty is now trading at its support levels i.e. 5750 odd levels which is supported by the gap which was formed on 28th June.

“Any move below this level may attract more panic selling which may drag a Nifty towards 5630/5600 levels also,” said Swati A. Hotkar, Technical Analyst at LKP Advisory.

“Upside resistance is place at 5920 levels and we advise traders to maintain a strict stop loss of 5750 levels for their long position,” she added.

According to analysts, the trend remains on the downside and the Nifty can plunge another 100 points from current levels. The index has a strong support at 5550-5600.

“Well, we may not break 5550-5600 on the downside but 100 points downside from current levels looks very likely,” said Sandeep Wagle, Founder & MD, APTART Technical Advisory Services in an interview with ET Now.

“There is a gap in the Nifty around 5680 levels, so there is a good chance that we may find some support there, but from a current level of 5770 and any upside in the markets should be sold into,” he added.

Overnight, US markets ended with modest gains as traders squared positions before the holiday and Friday’s job market data. US markets will remain close on Thursday on account of Independence Day holiday.

The Dow Jones industrial average rose 56.14 points or 0.38 per cent, to end at 14,988.55. The S&P 500 gained 1.33 points or 0.08 per cent, to finish at 1,615.41. The Nasdaq Composite added 10.27 points or 0.30 per cent, to close at 3,443.67.

Asian stocks were trading mixed ahead of the key events including the European Central Bank meeting and the U.S. non-farm payrolls report loomed.

“Unrest in Egypt came to a head on Wednesday, when the country’s armed forces removed President Mohamed Mursi to force a resolution to the political crisis,” Reuters reported.

“Also unsettling investors, the Portuguese government is struggling to survive following the resignations of its foreign minister and finance minister this week,” added the report.

U.S. crude edged up 0.1 percent to $101.33 a barrel.

Japan’s Nikkei 225 index was trading 0.04 per cent lower at 14,049.17 and Hong Kong’s Hang Seng index was trading 1.2 per cent higher at 20,394.12.

South Korea’s Kospi index was trading 0.3 per cent lower at 1830.45. China’s Shanghai index was trading 0.7 per cent lower at 1,979.63.

Narendra Modi begins BJP’s poll campaign, targets dual power centres in Congress and unemployment

Jun 242013
 

Narendra Modi begins BJP's poll campaign, targets dual power centres in Congress and unemploymentNEW DELHI: Gujarat chief minister NarendraModi on Sunday attacked the central government over issues ranging from dual power centres in the Congress to jobless growth and the aspirations of Kashmiri youth while addressing his first rally since being anointed chairman of the BJP’s national campaign committee.

A day after touring the site of devastation in Uttarakhand, Modi, the BJP’s presumptive prime ministerial candidate, seemed to have a firm eye on the next Lok Sabha elections as he spoke at at Madhopur in Punjab’s Pathankot district on the 60th death anniversary of Jan Sangh founder Syama Prasad Mookerjee.

“There are two bosses in the country and we do not know who is genuine,” he said, apparently referring to Congress president Sonia Gandhi and Prime Minister Manmohan Singh, as he recalled Mookerjee’s slogan against two heads in one system and said a similar situation existed in the country now.

Modi also reached out to the youth in Kashmir, saying the government should integrate them with the national mainstream. “The youth in Kashmir valley want to be part of development. Guns can spill blood but will do no good to one’s life,” he said, attacking the Centre’s Kashmir policy and signalling a willingness to adopt a softer approach on sensitive issues.

“(Former Prime Minister Atal Bihari) Vajpayee had sought to win over the heart of Kashmir with compassion, love and dialogue…Had he been elected to power in 2004, he would have succeeded in his Kashmir policy,” said Modi, who shared the stage with BJP’s ally, Punjab chief minister Parkash Singh Badal of the Shiromani Akali Dal.

The chief minister also attacked the Congress-led coalition for its handling of the economy, saying its weak leadership messed up the economy and confounded the problem of unemployment. Comparing the slide in the rupee with the Congress, Modi said the two were “competing as to who can fall more”.

The attack came in the backdrop of the NSSO findings showing a 10.2 per cent increase in the unemployment rate between January 2010 and 2012. Formal unemployment has risen from 9.8 million to 10.8 million over two years.

It pointed out that during the NDA government’s rule, more than 60 million jobs were created despite slower growth, prompting the BJP to cite the data as vindication of its stand that its economic management was better than that of the Congress.

Modi, who has been getting the highest approval ratings among the prime ministerial aspirants ahead of the next elections, also reinforced the central theme of his speech at the Goa conclave where he was named the chief of the committee. “For the future of this country and the bright future for the youth of this country we have to bring a Congress-free governance,” Modi said.

RBI pauses, hints at rate cut in July

Jun 182013
 

RBI pauses, hints at rate cut in JulyMUMBAI: After three consecutive rate cuts in 2013, the Reserve Bank of India (RBI) lived up to market expectations of a status-quo in its mid-quarter policy review on Monday, but raised hopes of a rate cut next month with milder statements on inflation. With no change in policy rates, bankers now forecast a dip in loan rates in the July-September quarter supported by a good monsoon.

“While there was no expectation of a rate cut for this month, we stick to our earlier stance that there is scope for a cut in benchmark rates later this year, perhaps even next month,” said Keki Mistry, vice-chairman and CEO of HDFC. He said that although liquidity has improved, deposit rates are yet to come down. “One big worry is the current account deficit and the currency. But as inflation eases, more money will come into bank deposits and banks will be in a position to cut rates,” he said.

Bankers and economists said RBI’s earlier statement that there is “little room” to cut rates – which RBI governor D Subbarao stated twice in the past – was conspicuous by its absence. In its mid-quarter review, the governor merely said that RBI will have to wait for a durable reduction in inflation before cutting rates.

While the governor has been less hawkish on inflation, a new element introduced in the policy statement has been the exchange rate concerns. “The rupee depreciated by 5.8% against the dollar during the current financial year up to June 14. It fell by 6.6% during May 22-June 11 due to sell-off by foreign institutional investors, reflecting risk-off sentiment triggered by apprehensions of possible tapering off of quantitative easing by the US Fed,” RBI said. On Monday, the rupee weakened by 34 paise against the dollar to 57.87 in the interbank foreign exchange market.

Large public sector banks have been citing high interest rates on small savings schemes as a deterrent to bringing down rates on deposits. However, Shikha Sharma, MD & CEO, Axis Bank, pointed out that in the past banks have offered lower returns on deposits even when small savings schemes offered prevailing rates. She said that the cost of wholesale funds has to start coming down before banks can lower deposit rates.

“It is apparent from the communication that while RBI is now more comfortable with the domestic atmosphere that can support monetary easing, it has heightened its risk perception of the external atmosphere. Thus, it mentions its worry on the pass-through effect of rupee depreciation. Further, the apprehension of RBI comes from the fact that there could be a sudden stop and reversal of capital flows from emerging markets, including India,” said Indranil Pan, chief economist, Kotak Mahindra Bank.

“After factoring in the risks to inflation and also the global financial markets, we see a bigger probability for the RBI to stay on a pause in the July policy meeting. We also believe that the chances of an extended pause have increased,” he added.

With data showing that GDP grew at sub-5% in Q4, there is a clear need for a pro-growth stance. But as banks pointed out, it was not absence of funds that was holding back investments in core projects but government clearances.

Also, cutting rates when the rupee is under pressure goes against text book economics which calls for higher interest rates to protect the exchange rate.

The less-hawkish-than-expected statement triggered a rally in government bonds and in the equity markets. But the rupee weakened by 34 paise against the dollar to 57.87 paise in the interbank foreign exchange market.

“With monsoon progressing well and with softening global commodity prices, we expect inflation to continue on its southward journey. This is likely to lead to a situation of ‘durable receding of inflation’ and should pave the way for monetary easing in short to medium term,” said Shyam Srinivasan, MD & CEO, Federal Bank.

Cheaper loans in 2nd qtr?

The fact that RBI did not say there is “little room” to cut rates after stating it twice before has boosted sentiment Bankers see a dip in loan rates in July-Sept quarter on back of good monsoon and an improvement in liquidity CAD and weakening currency remain top worries: If inflation eases, banks can cut rates after more money comes into deposits.

Rupee down 13 paise against dollar

Jul 242012
 

MUMBAI: The rupee on Tuesday breached the 56-mark, down 13 paise to trade at fresh three-week low of 56.10 against the US dollar on the Interbank Foreign Exchange due to strong demand for the American currency from banks and importers, particularly oil firms.

Besides, the dollar also strengthened against other currencies such as the euro in the overseas market on worsening euro zone worries and Moody’s downgrading Germany’s sovereign outlook to negative, putting further pressure on the rupee, dealers said.

The domestic currency has fallen past the 56-level against the dollar after June 29.