Views on markets today
- Indian markets rallied to a 31-month high and ended 1.9% higher yesterday, their best single-day percentage-point gain in more than three months, tracking global stocks as concerns about the world’s largest economy facing a double-dip recession faded after encouraging US payrolls data. Buying was broad-based as all the sectoral indices ended in green, with metal, bank and real estate stocks leading the rally. Firm metal prices in Shanghai and London pushed the metal makers higher.
- Market breadth was strong at ~2.35x as investors bought large cap stocks. Both FIIs and domestic institutions bought equities worth `9.46bn and `3.92bn respectively.
- The Asian markets are trading lower this morning. The Nikkei edged lower, dented by profit-taking after four straight days of large gains and as the yen’s strength shows little sign of abating. The Hang Seng is also trading lower.
- Indian markets are expected to open flat with negative bias as we could see profit-taking after the markets hit their highest in 31 months in yesterday session. Hindalco will be in focus after its unit Novelis plans to close down its foil rolling and packaging manufacturing facility in Bridgnorth in the UK by next year.
Economic and Corporate Developments
- Corporate tax receipts in April-August stood at `577.5bn, a rise of 17.05% from the year ago.
- India’s net direct tax receipts for the period April-Aug rose 13.91% yoy.
Buzzing Stocks
- The petroleum ministry has approved part-sale of government’s stake in ONGC and IOC, a move that could fetch the government over `240bn this financial year.
- A proposed `500bn deal to merge telecom tower assets of Reliance Infratel with GTL Infrastructure has failed to materialize.
- Reliance Industries, which has struck three shale gas joint ventures with US firms this year, may make a full buyout next, as the cash-rich firm builds the knowledge it needs to run such operations.
- Shree Renuka Sugars is setting up an integrated sugar-cum-ethanol plant with oil marketing company Hindustan Petroleum Corporation (HPCL) in Maharashtra.
- Power Finance Corp (PFC) plans to raise US$240mn through foreign loans in Japan and China for funding power projects in India.
- HDFC Bank raised its benchmark prime lending rate (BPLR) by 50bps to 16.25%.
- Opto Circuits has received an approval from the US FDA to market a new modular patient monitoring system — eVision 9100– in the US market.
- Fortis Healthcare is looking to list a real estate investment trust (REIT) in Singapore in the next six months to house its property assets and is looking at a valuation of US$600-700mn.
- Aurobindo Pharma has entered into an agreement with global biopharmaceutical company Astra Zeneca to supply several solid dosage and sterile products to emerging markets.
US markets
The US markets were shut on Monday on account of Labour Day holiday.
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