Kotak-ING Vysya deal: CCI will look at combined market share

NEW DELHI: The Competition Commission will look at the overall market share and size of the combined entity in the case of ING Vysya Bank's merger with Kotak Mahindra Bank when the proposal comes before the regulator for its approval.

In the biggest merger in India's banking sector, Kotak Mahindra Bank yesterday announced the buyout of ING Vysya Bank in an all-stock deal valued at Rs 15,000 crore.

"I suppose in due course they (the two banks) will make a filing to the Competition Commission. We will look at it as we look at any other merger proposal," the Competition Commission of India (CCI) Chairman Ashok Chawla told reporters here.

"The matter that will engage our attention is that the combined entity, what will be its market share and how big that will be. Based on that a decision will be taken within parameters of competition law," he said.

Chawla was responding to a query on what aspects of the deal the Commission would be looking into. He was speaking on the sidelines of Skoch Summit here.

CCI keeps a tab on anti-competitive practices at the market place across sectors and works to prevent as well as curb such activities.

Under the all-stock deal, ING Vysysa stock has been valued at Rs 790 a share, which is a 16 per cent premium to the 30-day stock price as of November 19, while pegging Kotak Bank at Rs 1,119 a share in similar manner.

Accordingly, ING shareholders would get 725 Kotak Mahindra Bank shares for 1000 shares of the Bangalore based lender. This values ING Vysya Bank at Rs 15,033 crore.

Post-deal, ING Group NV would have 6.5 per cent in the combined entity, while Kotak promoters' stake would be diluted to 34 per cent from 40.12 per cent.

After the transaction, ING would be the second largest stakeholder in the combined entity.
Source : economictimes

7 midcap stocks to bet post Sept quarter results

Midcap stocks are flavour of the season. The index is up 49% year-to-date and in 6 months it has jumped 35.90%. The BSE Midcap index touched its all-time highs of above 10,000 that it scaled in early 2008. ICICI Direct recommends 7 midcaps stocks to buy post September quarter results.

So, if you have been fence sitting and want to buy some midcaps, here are some stocks to buy.

Pidilite Industries

Rating: BUY

Potential upside: 16%

Target: Rs 462

Rationale: Estimate revenues, earnings CAGR of 19% in FY14-17E on the back of intact demand from tier II, tier III cities. A recovery in margin coupled with strong return ratios would justify the company’s re-rating possibilities.

IRB Infrastructure

Rating: HOLD

Target: Rs 269

Potential upside: Given the strong order of Rs 11,587 crore providing strong revenue visibility, see its earning to grow at 22.6 percent CAGR during FY14-16E. However, most of the positives have already been priced in the CMP. Hence, maintain HOLD.

Gujarat Pipavav Port

Rating: HOLD

Target: Rs 175

Potential upside: 3%

Rationale: With debt-free structure and ECB for funding further capex, interest cost is expected to decline substantially. Further, its higher revenue visibility and better margin on account of fixed cost model together with revenue from tank farms will provide further upside.

Gateway Distriparks

Rating: BUY

Target: Rs 330

Potential upside: 14%

Rationale: As container volumes at major ports like JNPT andChennai post growth of 9% and 5% YoY, respectively, in YTD, we expect the CFS segment to post confident growth.

East India Hotels

Rating: BUY

Target: Rs 124

Potential upside: 19%

Rationale: In terms of earnings, expect sales CAGR of 6.8% during FY14-16E coupled with expansion in margins.

Taj GVK Hotels

Rating: BUY

Target: Rs 116

Potential upside: 13%

Rationale: Expect the hotel business in Hyderabad to improve post resolution of the Telangana issue over next two years. Further, expansion into newer geographies of Bangalore and Mumbai would provide the company with better scale and geographic diversity over the longer-term.

Greaves Cotton

Rating: BUY

Target: Rs 175

Potential upside: 25%

Rationale: A recovery in the engines business and complete exit from the infrastructure business may drive PAT CAGR at 18% over FY14-17E. Even with the improvement in GDP, we expect sales to witness 14% CAGR over the same period.
Source : Moneycontrol

Both the indices end marginally higher after touching new peak

MUMBAI: Both the indices, sensex and nifty, ended marginally higher after touching life-time high in a truncated trading week.

This was on strong buying mainly in Realty, Healthcare, Banking and IT sectors despite mild profit-booking from operators in Metal, Power, Auto and Consumer Durable.

The Sensex conquered the 28,000 mark for the first time on expectations of more reforms by the Modi government and a rate cut by the RBI.

Markets were enthused after Finance Minister Arun Jaitley promised reforms in labour, land acquisition and insurance laws and expressed readiness to look at privatisation of some loss-making public sector companies.

Strong foreign capital inflows coupled with higher European cues mainly boosted the domestic market sentiment, even as services sector activity in India stagnated during October amid weaker growth of new orders as per an HSBC survey.

"The fall in crude oil prices will have a positive impact on, among other things, inflation....it will embolden the RBI to cut rates," said HDFC Securities in a note.

The sensex resumed higher at 27,943.04 and shot up further to an all-time high of 28,010.39 on initial strong buying. However, it declined afterwards to 27,739.56 before concluding the week at 27,868.33, showing a marginal gain of 2.70 points or 0.01 pct.

The CNX 50-share Nifty also moved by 14.80 points or 0.18 per cent to finish at 8,337.00 after touching an all-time high level of 8,365.55 during the week.

Ssentiments were on the negative side at the fag-end of the week in reaction to the OECD report, which lowered India's GDP growth forecast to 5.4 per cent for this year from 5.7 per cent earlier.

But, the downside also remained limited, tracking continuous FIIs inflow," said Jayant Manglik, President-retail distribution, Religare Securities.

BSE remained closed on November 4 for "Muharram" and November 6 on account of "Gurunanak Jayanti".

21 scrips out of the 30 Sensex companies ended lower while only nine finished higher.

Major losers from the Sensex pack were Gail India (8.34 per cent), Coal India (6.67 per cent), Hero Motocorp (5.33 per cent), M&M (4.81 per cent), Hindalco (4.38 per cent), SSLT (3.75 per cent), NTPC (3.63 per cent), Tata Steel (3.51 per cent), Tata Power (2.61 per cent), BHEL (2.60 per cent) and Reliance Ind (1.83 per cent).

However, Axis Bank rose by 6.86 per cent, followed by Dr Reddy (6.82 per cent), Sun Pharma (5.45 per cent), ICICI Bank (3.70 per cent), Infosys (2.89 per cent) and ONGC (1.04 per cent).

Among the S&P BSE sectoral indices, Realty rose by 5.73 per cent, followed by HC (3.70 per cent), Bankex (1.79 per cent), IT (1.11 per cent) and Teck by 1.06 per cent while Metal fell by 4.35 per cent, Power (1.49 per cent), CD (1.30 per cent) and Auto (1.29 per cent).

Small-cap and Mid-cap indices rose by 1.70 per cent and 1.68 per cent, respectively on persistent buying from retail investors.

Meanwhile, Foreign Portfolio Investors (FPIs) bought shares worth a net Rs 5,042.33 crore during the week, including the provisional figure of November 7.

The total turnover at BSE and NSE fell to Rs 11,865.96 crore and Rs 59,859.41 crore, respectively from Rs 15,192.70 crore and Rs 85,382.17 crore last week.
Source : economictimes

Choppy Sensex, Nifty end lower; auto, cap goods, auto drag

Equity benchmarks closed marginally lower amid consolidation on Friday, weighed down by capital goods, metals, auto and index heavyweights like Reliance and ITC. The broader markets closed mixed with the BSE Midcap rising 0.35 percent and Smallcap falling 0.4 percent.

The 30-share BSE Sensex declined 47.25 points to close at 27868.63 and the 50-share NSE Nifty fell 1.30 points to 8337.

This is a market in which investors should buy on dips, says Vibhav Kapoor, Group Chief Investment Officer, IL&FS.

According to him, the market is right now banking on hope and trying to discount FY16 numbers instead of FY15 numbers, be it macro or corporate earnings. The macro environment still looked a bit uncertain at the moment, but there were enough signs of an improvement in FY16, he added.

Kapoor expects to see the Nifty at 9000 by March 2015 while Aditya Narain, Citigroup remains comfortable with market view of 31,000 on the Sensex by December 2015.

For the week, the Sensex, Nifty closed flat while the CNX Midcap and BSE Smallcap indices gained more than a percent.

Meanwhile, media report suggested that Union Council of Ministers will be expanded on Sunday in which about 10 new faces, including Goa Chief Minister Manohar Parrikar, are likely to be inducted in an exercise that may also cover some allies.

State-run power equipment maker BHEL fell more than 3 percent while engineering and construction major Larsen & Toubro declined a percent ahead of earnings later today.

Private sector lender HDFC Bank fell 1.5 percent as the MSCI has deleted it from its India index. Public sector lender State Bank of India was down 1.5 percent while its rivals Axis Bank and ICICI Bank gained 2.8 percent and 1 percent, respectively.

Two-wheeler maker Hero Motocorp lost 1.9 percentas 2.9 percent equity shares changed hands via block deals today and most likely Bain Capital was the seller.

Among others, Reliance Industries, TCS, ITC, M&M, Sesa Sterlite, Gail India, Wipro, Tata Steel and Cipla were down 0.8-2 percent.

India’s largest coal miner Coal India declined 1 percent ahead of earnings on Saturday.

Drug maker Dr Reddy’s Labs topped buying list in the Sensex. Dr Reddy's Labs surged nearly 5 percent as it received USFDA approval for Valcyte generic while DLF climbed 5.5 percent as the Securities Appellate Tribunal or SAT has allowed the realty major to redeem Rs 1,806 crore from mutual funds till next month.

Other gainers include Axis Bank, HUL and ONGC.

BSE midcap gainers were Allcargo, Risa International, Abbott India, Firstsource Solution and
Prestige Estate. Shares of Aurobindo Pharma hit record high at Rs 1043.40 per share, up 4 percent intraday after it has reported a whopping 58.3 percent growth in consolidated net profit at Rs 372 crore for July-September quarter led by US generics.

Top losers in the midcap were Birla Corp, UCO Bank, Novartis India, NBCC and Bhushan.

About 1440 shares advanced while 1564 shares declined on the Bombay Stock Exchange.
Source : Moneycontrol

Wall Street dips after payrolls, but uptrend seen intact

NEW YORK: US stocks receded from record levels on Friday as investors locked in profits after the October payroll report came in weaker than expected, even as the report pointed to economic resilience in the face of slowing global demand.

Employers added 214,000 new jobs last month, below the 231,000 that was expected, while the September report was revised higher. The unemployment rate fell to 5.8 percent from 5.9 percent.

"It's hard to not bet on the economy, with the fundamentals looking like a full house: earnings are rock solid, we're growing at a nice pace and confidence is up," said David Kelly, chief global strategist for JPMorgan Funds in New York.

"The number was slightly weaker than expected, but until we see real weakness or higher interest rates, we'll continue to be overweight on equities."

The Dow was pressured by Walt Disney Co, which fell 3.4 percent to $88.82 a day after posting earnings that met expectations, though its cable networks were weaker. The stock closed at a record on Thursday.

Salix Pharmaceuticals Ltd plummeted 35 percent to $89.21 in its biggest one-day drop a day after it slashed its full-year forecast as its inventory for key drugs piled up. The issue dissuaded Allergan Inc from acquiring the drugmaker, people familiar with the matter said. More than 5.5 million shares exchanged hands in early trading, more than twice Salix's 50-day average of almost 2 million.

Energy shares were sharply higher on the day, rising 0.8 percent alongside a 1.3 percent jump in crude oil prices.

The industry was the top-performing S&P 500 sector by far. Among the most active names, Chesapeake Energy rose 2.6 percent to $23.34 while Newfield Exploration was up 2.4 percent at $33.28.

At 9:49 a.m. (1449 GMT) the Dow Jones industrial average fell 34.92 points, or 0.2 percent, to 17,519.55, the S&P 500 lost 2.4 points, or 0.12 percent, to 2,028.81 and the Nasdaq Composite dropped 10.38 points, or 0.22 percent, to 4,628.09.

For the week, the Dow is up 0.7 percent and the S&P is up 0.5 percent in their third straight week of gains. The Nasdaq is down 0.1 percent for the week.

While political tensions abroad have largely faded from markets, a cautious note was added to the market after the Kiev military said a column of tanks had crossed into eastern Ukraine from Russia.

Declining issues outnumbered advancing ones on the NYSE by 1,537 to 1,189, for a 1.29-to-1 ratio on the downside; on the Nasdaq, 1,465 issues fell and 821 advanced for a 1.78-to-1 ratio favoring decliners.

The S&P 500 index posted 28 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 43 new highs and 24 new lows.
Source : Moneycontrol

Bank of Maharashtra net profit soars 248% on higher margin recoveries

MUMBAI: State-run lender Bank of Maharashtra today reported a 248 per cent jump in net profit at Rs 162.91 crore in the September quarter on account of higher margin and improvement in cash recoveries.

The state run lender's net profit in the corresponding July-September quarter of the previous fiscal stood at Rs 46.85 crore.

"We have had a significant improvement on yield on advances, reduction in deposit cost and we have also had improved investment yields. These have resulted in net interest margins and return on assets," bank chairman and managing director S Muhnot told reporters here today.

Net interest margins grew to 2.90 per cent from 2.69 per cent in the year-ago period, while return on assets improved to 0.48 per cent from 0.14 per cent and yield on advances rose to 11.28 per cent from 11.05 per cent and yield from investments rose to 7.88 per cent from 7.79 per cent.

The bank was able to bring down its cost of funds to 6.47 per cent in the period from 6.58 per cent last year.

However, its asset quality worsened with gross non-performing assets soaring to 4.83 per cent from 2.77 per cent, while net NPAs nearly doubled to 3.29 per cent from 1.76 per cent.

Fresh slippages rose to Rs 1,277 crore as against Rs 1,206 crore last year. "Going forward, we expect slippages to reduce on higher recoveries and upgrades," Muhnot said.

Cash recoveries in the quarter jumped to Rs 218 crore from Rs 89 crore, while the bank upgraded Rs 426 crore of loan as against Rs 119 crore in the year ago period. The Pune-based lender wrote off Rs 52.21 crore of loans during the quarter.

Recoveries in the quarter stood at Rs 590 crore and the bank expects a similar amount of recoveries in pipeline. Total deposits increased to Rs 1,17,452 crore from Rs 1,17,293 crore last year, while advances increased from Rs 88,419 crore to Rs 90,119 crore.

Muhnot said the bank has asked for Rs 1,100 crore in capital infusion from the government. The bank is also planning to raise Rs 500 crore through issuance of additional Tier I bonds.

Bank of Maharashtra shares closed at Rs 44.60 per scrip on the BSE today, up 0.22 per cent from their previous close.
Source : Moneycontrol

Top exchanges BSE and NSE to suspend trading in Kingfisher Airlines, UB Engineering

MUMBAI: In a major clampdown for non- compliance of Listing Agreement, top exchanges BSE and NSE today announced suspension of trading in shares of Kingfisher Airlines and another group firm, UB Engineering, from next month.

Besides, the entire promoter shareholding of these companies have been frozen with effect from today itself.

The action follows non-compliance to a Listing Agreement clause relating to timely preparation and disclosure of financial results by a listed company for two consecutive quarters. The results are required to be disclosed by listed companies on stock exchange platform for benefit of investors.

In separate circulars, BSE and NSE said that the trading would be suspended in securities of Kingfisher and UB Engineering -- both parts of crisis-hit UB group headed by Vijay Mallya -- with effect from December 1.

The suspension follows Sebi guidelines with respect to Standard Operating Procedure (SOP) for suspension and revocation of trading of shares of listed entities for noncompliance of the Listing Agreement that a listed company needs to follow pursuant to its shares getting listed and traded on a stock exchange.

Shares of Kingfisher, once touted as most luxurious airline in India, are currently trading below Rs 2 apiece and its market capitalisation now stands at just about Rs 150 crore. At one point of time, before financial troubles began and led to its grounding in October 2012, the company carried a market valuation of close to Rs 10,000 crore.

For the year ended March 2013, the carrier saw its net loss widen to Rs 4,301.12 crore. During that period, the gross income stood at Rs 683.46 crore. A consortium of 17 banks has an outstanding debt of about Rs 6,521 crore from the now-grounded carrier and outside the consortium, there are some other loans also.

In Kingfisher, promoters have just 8.54 per cent stake, while public holding stands very high at 91.46 per cent.

The non-promoter shareholders include more than two lakh small investors, over 6,000 HNIs, over 2000 NRIs and 13 FIIs, among others.

Along with Kingfisher and UB Engineering, NSE has also announced trading suspension for securities of Varun Industries Limited on account of non-compliance with Clause 41 of the Listing Agreement for two consecutive quarters, that is quarter ended March, 2014 and June, 2014.

"Accordingly, the entire promoter shareholding of Varun Industries Limited, UB Engineering Limited and Kingfisher Airlines Limited shall be freezed with effect from November 7, 2014 till further notice."

"In case, Varun Industries, UB Engineering and Kingfisher Airlines complies with respective requirement/s including payment of fines on or before November 25, 2014 (five days before the proposed date of suspension), the trading in securities of the said companies will not be suspended," NSE said.

In UB Engineering, which has a market cap of about Rs 14 crore, public holds 59.26 per cent stake while promoter group controls 40.74 per cent.

In case these companies fail to comply with the provisions of the Listing Agreement on or before November 25, 2014, then trading in their shares would be suspended from December 1 and the suspension will continue till such time the company complies including the payment of fine.

After 15 days of suspension, trading in the shares of non-compliant companies would be allowed on Trade for Trade basis in on the first trading day of every week for six months, NSE said.

BSE has taken similar action against 21 companies, including Kingfisher and UB Engineering.

Others include Nilachal Refractories, Linkson International, Secure Earth Technologies, Ratan Glitter Industries, Bheema Cements, Arvind International, Elegant Floriculture & Agrotech India, Pretto Leather Industries, UT Ltd, Arihants Securities Ltd, Raghava Estates and Properties, Tutis Technologies, Valuemart Info Technologies, Ontrack Systems, Avon Corporation, Birla Pacific Medspa, Best & Crompton Engineering, Varun Industries and Maestros Mediline Systems.

Kingfisher Airlines is already facing a close regulatory scrutiny over suspected lapses in its accounting practices and the Corporate Affairs Ministry is looking into possible violations of Companies Act.

The airline, part of Vijay Mallya-led UB Group, has been grounded for over two years now after being bogged down by huge and mounting losses.

The carrier is yet to submit its annual financial results for the 2013-14 period to the stock exchanges.

In a filing to the BSE on August 26, the carrier had said that steps were being taken to appoint directors in order to comply with provisions of the Companies Act, 2013 and listing agreement with the stock exchanges.

"Thereafter, steps will be taken towards publishing the audited results for the year ended March 31, 2014 and for the quarter ended June 30, 2014," it had said.

Back in May, Kingfisher had informed stock exchanges that "there are hardly any employees attending office and the company is currently operating with skeletal staff making it difficult to audit and publish the results in time."

As part of the recovery process, banks in February last year decided to sell a portion of the collateral with them, including shares of its group companies United Spirits Ltd and Mangalore Chemicals & Fertilizers Ltd, Mallya's Goa villa, Kingfisher House in Mumbai and the Kingfisher brand, which was valued at over Rs 4,000 crore at the time it was pledged.

Sensex gains 109 pts; banks lead, HCL Tech & TCS tank 9%

Equity benchmarks closed off day's high ahead of Maharashtra and Haryana state elections results that will be announced on Sunday. Indices were directionless since the opening trade but gained strength in last hour of trade to jump as high as 249 points on the Sensex (and to hit 7800 level intraday on positive European cues) before seeing some profit booking in late trade.

The 30-share BSE Sensex climbed 109.19 points to close at 26108.53 and the 50-share NSE Nifty rose 31.50 points to 7779.70 after losing over a percent in previous session.

Experts believe this upmove is not sustainable amid concerns over global growth and consistent selling pressure from foreign institutional investors (FIIs). They advise buying quality stocks on every dip.

Sanjeev Zarbade of Kotak Securities believes the performance of the Indian equities remains contingent on resumption of FII flows.

While Mehraboon Irani expects levels of 7400 to be breached by the market on the downside, he suggests investors to buy into stocks of their choice. He says the global factors will continue to have a significant impact on the market and any negative news may lead to lower rupee levels like 62 against the dollar.

However, reducing inflation, lower commodity prices and expected reforms push remain significant tailwinds for the markets, says Zarbade.

Banks topped the buying list today with the Bank Nifty rising 2.5 percent as top lenders State Bank of India, HDFC Bank and ICICI Bank rallied 2-3 percent while housing finance company HDFC gained 1.7 percent.

Axis Bank rose 2 percent ahead of results that announced post market hours. The private sector lender met street expectations with the second quarter net profit rising 18.3 percent Y-o-Y led by higher other income and net interest income but higher provisions limited profitability. NII jumped 20 percent with stable asset quality.

Two-wheeler maker Hero Motocorp rallied 3 percent on reporting a 58 percent growth in Q2 profits led by other income.

Zee Entertainment gained 3 percent after the company beat expectations on operational front. Earnings before interest, tax, depreciation and amortisation (EBITDA) grew by 3.5 percent to Rs 321 crore and margin expanded by 50 basis points to 28.7 percent on lower operating cost. Analysts had expected both at Rs 320 crore and 27.5 percent, respectively.

Larsen and Toubro, BHEL, Mahindra and Mahindra, Bharti Airtel, Cipla and Tata Power were other prominent gainers with 2-3.4 percent upside.

However, technology stocks saw huge selling pressure with the CNX IT index falling 4 percent. It was a twin blow for the tech sector; TCS tanked nearly 9 percent after dollar revenue growth missed expectations. The company said softness in certain businesses may continue for two more quarters and that meeting FY14 growth will be difficult in FY15.

HCL Technologies too took a hard knock on similar growth worries, falling 9 percent. Dollar revenue for Q1 came in lower than estimate at USD 1,433 million.

Sesa Sterlite, Hindalco, Tata Motors, Wipro and Jindal Steel fell 1-2.8 percent.

About 1335 shares advanced while 1505 shares declined on the Bombay Stock Exchange.

Meanwhile, the Indian rupee recovered sharply, up 39 paise to close at 61.44 a dollar after falling to 7-month low of 61.83 in previous session. Fresh selling of dollars by exporters and banks supported the rupeerecovery.

On the global front, European markets gained more than a 1 percent while Asian markets like Japan and Taiwan Weighted fell another 1-1.5 percent after yesterday's blow. A comment from hawkish Federal Reserve official James Bullard on Thursday that the Fed should continue bond buying lifted sentiment and surprised many observers.
Source : Moneycontrol

Wall Street: US stocks drop amid global equity selloff

NEW YORK: US stocks dropped sharply in early trade Thursday, following international markets downward as anxiety over global growth continued to prompt selling.

About 30 minutes into trade, the Dow Jones Industrial Average stood at 16,062.34, down 79.40 points (0.49 per cent).

The broad-based S&P 500 fell 13.75 (0.74 per cent) to 1,848.74, while the tech-rich Nasdaq Composite Index tumbled 43.05 (1.02 per cent) to 4,172.27.

Equity markets in Britain and France were down more than 1.0 per cent. Asian markets also fell sharply, with Japan's Nikkei tumbling 2.22 per cent.

"Global risk aversion is persisting amid exacerbated global growth concerns, fueled by yesterday's surprising decline in US retail sales," said a market note from Charles Schwab.

"Moreover, a flare-up in Greek debt concerns, festering Ebola fears, and heightened geopolitical concerns are adding to the dampened global mood."

Thursday's declines move the market closer to a full-blown correction, normally considered a drop of 10-20 per cent. The S&P 500 has fallen about eight per cent since its mid-September all-time high.

Investors brushed off positive news, such as a drop in initial jobless claims to 264,000, the lowest level since April 2000, according to the Department of Labor.

Dow member Goldman Sachs fell 2.1 per cent despite reporting a 50 per cent increase in third-quarter earnings to $2.14 billion in results that bested Wall Street expectations by a wide margin.

Video-streaming company Netflix plummeted 22.7 per cent on disappointing subscriber growth figures. The video-streaming company said it gained just three million members in the past quarter, to boost its subscribers to 53.1 million worldwide.

Apple fell 1.5 per cent ahead of an event in California later Thursday at which it is expected to unveil new versions of the iPad.

Chesapeake Energy bolted 13.5 per cent higher following news it will sell shale oil and gas assets to Southwestern Energy for $5.4 billion. Southwestern lost 6.9 per cent.

EBay dropped 4.9 per cent as it projected fourth-quarter revenues of $4.85-$4.95 billion, below analyst forecasts for $5.16 billion. The profit outlook was also on the low end of expectations.

Bond prices were mixed. The yield on the 10-year US Treasury held steady at 2.09 per cent, the same level as Wednesday, while the 30-year stood at 2.87 per cent, down from 2.88 per cent. Bond prices and yields move inversely.

Oil prices briefly dipped below $80 a barrel for the US benchmark contract, before coming back to 80.75, off $1.03 from Wednesday's close.
Source : economictimes

Wall Street bounces after 3-day slump on earnings hope

NEW YORK: US stocks were higher on Tuesday, rebounding after the S&P 500's worst three-day drop since November 2011, as bullish investors hoped a solid earnings season would ease global growth concerns.

Citigroup, up 3.2 per cent to $51.48, was among the top boosts to the benchmark S&P index after the bank posted better-than-expected quarterly results and said it would pull out of consumer banking in 11 markets.

But JPMorgan Chase shares lost 1.1 per cent to $57.54, after the biggest US bank posted third-quarter earnings. Wells Fargo, the fourth largest US bank, lost 1.6 per cent to $49.39 after its results.

The S&P financial index gained 0.7 per cent.

Johnson & Johnson shares lost 1.3 per cent to $97.82 even after the diversified healthcare company reported better-than-expected quarterly earnings on the back of strong sales for a new hepatitis C drug.

The index closed below its 200-day moving average for the first time since Nov. 16, 2012, on Monday and is now down 6.1 per cent from its record closing high on September 18.

S&P 500 companies are expected to show earnings growth of 6.4 per cent in the third quarter, according to Thomson Reuters data, with revenue growth expected at 4 per cent. After the close, Dow component and chipmaker Intel is set to post results.

At 10:58am, the Dow Jones industrial average rose 84.83 points, or 0.52 per cent, to 16,405.9, the S&P 500 gained 12.45 points, or 0.66 per cent, to 1,887.19 and the Nasdaq Composite added 39.84 points, or 0.95 per cent, to 4,253.50.

The largest per centage gainer on the S&P 500 was Delta Air Lines, up 5.6 per cent, while the largest per centage decliner was ONEOK Inc, down 3.3 per cent.

The largest per centage gainer on the Nasdaq 100 was NXP Semiconductors, up 5.1 per cent, while the largest per centage decliner was Autodesk, down 2.1 per cent.

Among the most active stocks on the NYSE were Bank Of America, up 0.67 per cent to $16.51; Petrobras, up 0.23 per cent to $17.31; and Advanced Micro Devices, down 1.09 per cent to $2.71.

On the Nasdaq, APPLE, up 0.3 per cent to $100.08, and Facebook, up 0.5 per cent to $73.34, were among the most actively traded.

Advancing issues were outnumbering declining ones on the NYSE by 2,020 to 953, for a 2.12-to-1 ratio on the upside; on the Nasdaq, 1,862 issues were rising and 690 falling for a 2.70-to-1 ratio favoring advancers.

The benchmark S&P 500 index was posting 6 new 52-week highs and 23 new lows; the Nasdaq Composite was recording 16 new highs and 121 new lows.

Sensex slumps as recession fears loom over Euro Zone

Foreign institutional investors stepped up selling of Indian stocks on Friday, causing benchmark indices to fall 1.3% on growing concern that the slowdown in the euro zone is far from over.
Investors were also influenced by the heavy sell-off on Wall Street on Thursday after senior US Fed officials said they expect interest rates to rise by mid-2015. Even a sharp decline in oil prices failed to cushion the fall on Friday.

The sell-off resulted in the stock market giving up the previous day's gains, which were sparked by contents of the US Federal Reserve's minutes of September meeting suggesting that the US central bank is not in a hurry to hike interest rates.

"There is total confusion about the direction of the developed economies, which is worrying the markets. In the absence of any domestic triggers, the focus will remain on global events," said Tirthankar Patnaik, director, institutional research, Religare Capital.

BSE's Sensex fell 339.90 points, or 1.28%, to close at 26,297.38. NSE's Nifty dropped 100.60 points, or 1.26%, to close at 7,859.95. Out of the 3,023 stocks traded on the BSE, 1,910 declined, while 998 gained, showing the market breadth was weak.

Metals, consumer goods and auto shares led the sell-off, while technology shares bucked the weak trend after Infosys' second quarter earnings surprised the market. Foreign institutional investors net sold shares worth almost Rs 720 crore on Friday, extending their selling spree to the third straight week worth Rs 3,800 crore. So far in 2014, these investors have net bought shares worth Rs 90,000 crore.

Most Asian markets fell 1-2% on Friday after euro zone's largest economy, Germany, saw a slump in exports, reviving fears that the region may slip into a recession. International Monetary Fund managing director Christine Lagarde warned that the euro zone could fall back into recession if fresh steps are not taken to prevent it. She also said the euro zone is showing the symptoms of Japan's protracted economic slump.

Wall Street had slumped 2% on Thursday after Fed vice chairman Stanley Fisher and San Francisco Fed president John Williams both said they expect higher interest rates by mid-2015. Oil prices fell on worries a slowdown in the global economy would hit demand. Brent crude fell $1.65 to $88.40, levels last seen in November 2010.
Source : economictimes

Wall Street falls, Dow in negative territory for 2014

NEW YORK: US stocks fell on Friday, with the Dow ending in negative territory for the year and the S&P 500 and Nasdaq posting their worst weeks since May 2012.

Technology shares led the day's decline after a chipmaker warned of a major pullback in the industry.

Based on the latest available data, the Dow Jones industrial average fell 115.15 points, or 0.69 per cent, to 16,544.1, the S&P 500 lost 22.08 points, or 1.15 per cent, to 1,906.13 and the Nasdaq Composite dropped 102.10 points, or 2.33 per cent, to 4,276.24.

Source : economictimes

Sensex ends 390 points up

The Nifty bounced back after three days of decline and closed above 7,950 as sentiment turned bullish in global markets as the US Federal Reserve's indicated interest rates will not be hiked earlier than expected.

The Sensex ended the day at 26,637.28; up 390.49 points.

The Nifty shut shop at 7,960.55; up 117.85 points.

The S&P BSE Midcap Index rallied 1.82 per cent and the S&P BSE Smallcap Index surged 1.54 per cent.

Among the sectoral indices, the S&P BSE Capital goods Index gained 3.01 per cent, the S&P BSE Bankex was 2.41 per cent higher, the S&P BSE Power Index advanced 2.25 per cent and the S&P BSE Metal Index advanced 1.76 per cent.

BHEL (up 8.16 per cent), Hindalco (up 5.51 per cent), Zee Entertainment (up 5.10 per cent), Ambuja Cements (up 3.89 per cent) and Punjab National Bank (up 3.33 per cent) were among the Nifty gainers.

Tech Mahindra (2.55 per cent), Jindal Steel (0.60 per cent), NMDC (0.56 per cent), NTPC (0.49 per cent) and Wipro (0.48 per cent) were among the top losers.

The market breadth was positive on the NSE with 923 gainers against 217 losers.
Source : economictimes

Wall Street dips on growth concerns after massive rally

US stocks edged lower on Thursday as concerns over global growth spurred investors to take profits following a massive advance in the previous session.

While domestic news - including job data and corporate earnings - was encouraging, investors continued taking their trading cues from abroad.

German exports dropped by 5.8 per cent in August, their biggest fall since January 2009. The data was the latest indication, following bearish reads on industrial output and industrial orders, that Europe's largest economy was faltering amid broader weakness in the euro zone. Separately, data this week showed growth in the Chinese services sector weakened slightly in September.

The third-quarter earnings season got off to a strong start, with both Alcoa Inc and PepsiCo Inc rallying after results topped expectations.

Alcoa rose 0.8 per cent to $16.19 while PepsiCo was up 0.9 per cent at $94.79.

On the downside, Gap Inc plunged 12 per cent to $36.94 as the S&P 500's biggest decliner a day after it reported weaker-than-expected same-store sales for September and said its chief executive would retire in February.

Jobless claims dropped 1,000 to a seasonally adjusted 287,000 in the latest week. The report supported September jobs data, which also pointed to improving conditions in the labor market.

Wall Street soared on Wednesday, with major indexes posting their biggest one-day jump of the year after the Federal Reserve reassured investors its first rate hike would come when economic data pointed to an economy that could grow without Fed stimulus, rather than on a specific schedule. With the day's advance, the S&P 500 jumped back above its 100-day moving average, a sign of improving near-term momentum.

The Dow Jones industrial average fell 45.98 points, or 0.27 per cent, to 16,948.24, the S&P 500 lost 5.75 points, or 0.29 per cent, to 1,963.14 and the Nasdaq Composite

dropped 13.41 points, or 0.3 per cent, to 4,455.19.

Declining issues outnumbered advancing ones on the NYSE by 1,801 to 888, for a 2.03-to-1 ratio; on the Nasdaq, 1,616 issues were fell and 573 advanced for a 2.82-to-1 ratio favoring decliners.

The benchmark S&P 500 index posted 18 new 52-week highs and no new lows; the Nasdaq Composite recorded 14 new highs and 33 new lows.
Source : economictimes

RBI to cut rates by 75 basis points in 2015, starting February

The Reserve Bank is likely to cut rates beginning February as inflation is expected to reach the targetted 8 per cent by next January, says a Bank of America Merrill Lynch report.

RBI Governor Raghuram Rajan is expected to cut 75 basis points in 2015, beginning February, according to the global financial services major.

RBI would get the comfort of meeting its 8 per cent January Consumer Price Index-based inflation target, BofA-ML said, adding that "we expect the RBI to cut 75 bp in 2015 from February with inflation on course to 6 per cent in January 2016". The central bank is likely to be on hold on its next policy meet on December 2.

The factors that are likely to lead to a rate cut early next year include bottoming of inflation, late rains and US Federal Reserve's rate hike expectations, it said.

Late rains would likely water reasonable winter sowing to douse agflation and finally, US Fed rate hike expectations should hold oil prices in check, it added.

In the recent past inflation has seen some moderation falling from double-digit figures in 2013 to 7.8 per cent, year-on-year, in August.

In the last monetary policy, Rajan left all key rates unchanged citing continued risks to inflation and difficult external situation especially on the geopolitical front.

For the fourth consecutive time RBI had kept key interest rates unaltered. The short-term lending rate (repo) rate remained at 8 per cent, and the cash reserve requirement of banks at 4 per cent.

The report said: "Supply concerns are expectedly proving overdone. Second, the Rs 1,28,400 crore surplus with the RBI and coal fines or auctions should buffer the Rs 4,67,300 crore net borrowing programme from fiscal slippage."

BofA-ML expects the government to raise overseas investors investment limit in government bonds to raise the country's foreign exchange reserves.

"It should hike on-auction G-Sec limits by $5 billion to $30 billion, doing away with the separate limit for sovereign wealth funds (SWFs), within the overall $81 billion FII debt limit," the report said.

FIIs have almost entirely utilised their $25 billion limit.

BofA-ML said separate SWF limits are not utilised as many SWFs invest in emerging market/India paper through FIIs. The report sees the rupee at Rs 62 in December with the US dollar settling at 1.25/euro.

It does not expect RBI to fight a rising US dollar beyond 1.25/euro, although dollar/rupee accounts for 85 per cent of the country's trade.

"After all, it is simply not possible for it to offset cross-currency pressures from the greenback given limited forex reserves," the report said.

The American brokerage expects RBI to buy $35-40 billion by March 2016 to maintain 8-month import cover that is key to rupee stability.
Source : economictimes

Sensex ends in red on weak global cues : tech, pharma down

The S&P BSE Sensex ended a volatile session on flat-to-negative note as global markets remained under pressure on concerns of global economic growth. Outflows of dollars from emerging markets including India also added to the woes.

The International Monetary Fund has cut global growth forecast and that for emerging market economies as a whole. The IMF expects global economy to grow by 3.8 per cent next year, lower than its July forecast of 4 per cent.

The 30-share index ended at 26,246.79, down 25.18 points or 0.10 per cent. It touched a high of 26,338.31 and a low of 26,150.09 in trade today.

The Nifty closed at 7,842.70, down 9.70 points or 0.12 per cent. It touched a high of 7,869.90 and a low of 7,815.75 in trade today.

The S&P BSE Midcap Index was slipped 0.23 per cent and the S&P BSE Smallcap Index gained 0.06 per cent.

The S&P BSE Capital goods Index gained 1.61 per cent, the S&P BSE Auto Index was 0.58 per cent higher and S&P BSE Bankex advanced 1.09 per cent.

The S&P BSE IT Index fell 3.44 per cent and the S&P BSE Healthcare Index was down 3.27 per cent.

Infosys (4.70 per cent), Dr Reddy's Laboratories (4.37 per cent), Sun Pharma (4.31 per cent), Wipro (4.03 per cent) and Cipla (2.51 per cent) were among the top losers.

Tata Steel (up 3.52 per cent), L&T (up 2.32 per cent), ONGC (up 2.30 per cent), NTPC (up 2.24 per cent) and BHEL (up 2.10 per cent) were among the Sensex gainers.

The market breadth was negative on the BSE with 1343 gainers against 1562 losers.
Source : economictimes

Wall Street gains, S&P edges above 50-day moving average

NEW YORK: US stocks rose on Monday, extending a rally from the previous session as investors grew more confident in the economy's strength and Federal Reserve policy.

Merger activity and corporate restructuring also boosted equities, with the S&P 500 advancing above its 50-day moving average for the first time since Sept. 29, a sign that near-term momentum is improving.

Tech shares were among the strongest of the day after Hewlett-Packard Co said it would split into two public companies, sending shares up 4.2 per cent to $36.68 on heavy volume.

Separately, Becton Dickinson & Co agreed to buy CareFusion Corp for $12.2 billion in cash and stock.

Becton jumped 6.8 per cent to $123.52 while CareFusion was up 23 per cent to $56.96 as the S&P 500's biggest gainer.

The S&P 500 index had posted its best day since August on Friday, lifted by a stronger-than-expected jobs report that boosted optimism about the economy, while the Federal Reserve was not seen as speeding up its timeline for raising interest rates. 

Market volatility has been higher of late, with equities notching big swings amid unrest in Hong Kong and concerns about Ebola in the United States. Those issues could continue to drive trading. The CBOE Volatility index fell 1.6 per cent to 14.32, well below its long-term average of 20.

The Dow Jones industrial average was rising 76.01 points, or 0.45 per cent, to 17,085.7, the S&P 500 was gaining 8.18 points, or 0.42 per cent, to 1,976.08 and the Nasdaq Composite was adding 13.42 points, or 0.3 per cent, to 4,489.05.

Advancing issues were outnumbering declining ones on the NYSE by 2,066 to 674, for a 3.07-to-1 ratio on the upside; on the Nasdaq, 1,356 issues were rising and 899 falling for a 1.51-to-1 ratio favoring advancers.

The benchmark S&P 500 index was posting 15 new 52-week highs and no new lows; the Nasdaq Composite was recording 16 new highs and 21 new lows.
Source : economictimes

Top ten stocks for 13% to 15% return in next 4-5 days

Top ten stocks for 13% to 15% return in next 4-5 days

1. Dena Bank: BUY in NSE cash above 59.75 with stop loss of 57.40, Target of 62.10,64 .

2. REC: BUY in NSE cash above 257 with stop loss of 244 and a target of 270,280.

3. Jyoti Structures: BUY in NSE cash above 42.15 with stop loss of 40.15 and a target of 44.15, 46.15 .

4. Dish TV: BUY in NSE cash above 55.50 with the stop loss of 53 and a target of 58, 60 .

5. Mahindra & Mahindra: (CMP - 1390, Target - 1450) .

6. HOV Services: (CMP - 153, Target - 170)

7. Yes Bank: (CMP - 557, Target - 585)

8. Jet Airways: (CMP - 212, Target - 225)

9. Apollo Hospitals: (CMP - 1116, Target - 1175)

Strong US jobs data boosts dollar and world stocks

The dollar climbed to a more than four-year peak and global equity markets surged on Friday after data showed U.S. employers stepped up hiring in September and the jobless rate fell to a six-year low, further signs of a relatively strong economy.

The strong dollar pushed gold below USD 1,200 an ounce for the first time this year after the Labor Department reported that US nonfarm payrolls rose by 248,000 last month and the jobless rate fell two-tenths of a point to 5.9 percent.

The better-than-expected report knocked the euro to a more than two-year low against the dollar, which hit a 15-month high against the Swiss franc. The dollar index, a measure of the greenback against six major currencies, headed toward its biggest yearly gain in nine years, up 8 percent so far in 2014.

Stocks on Wall Street rose more than 1 percent, and European shares finished with a gain just under that level.

The dollar index hit a high of 86.746, its strongest level since June 2010, and was last up 1.24 percent at 86.663.

Against the yen, the greenback jumped 1.31 percent to 109.83 yen, while the euro slid 1.23 percent to USD 1.2512.

MSCI's all-country world index of stock performance in 45 countries rose 0.51 percent.

The FTSEurofirst 300 index of top European shares closed up 0.9 percent at 1,347.14. Shares of European airlines rallied as the price of oil dropped, and exporters suchas Airbus got a lift from the euro's renewed slide.

On Wall Street, the Dow Jones industrial average rose 214.3 points, or 1.28 percent, to 17,015.35. The S&P 500 gained 23.56 points, or 1.21 percent, to 1,969.73 and the Nasdaq Composite added 54.83 points, or 1.24 percent, to 4,485.03.

German Bund yields rose a day after the European Central Bank showed little willingness to stimulate the economy through the purchase of sovereign debt. Markets could be in for a rough fourth quarter as investors anticipate tighter Fed monetary policy and if the ECB stands pat.

Bund yields rose 2 basis points to 0.93 percent. Treasuries prices fell. The 10-year Treasury note fell 3/32 in price to yield 2.4466 percent.

Brent crude oil futures fell below $92 a barrel at one point, down for a fourth consecutive day in a slide that has pushed prices to their lowest levels since 2012. Abundant supplies and a strong dollar continue to weigh on the market.

Brent for November delivery settled down USD 1.11 at USD 92.31 a barrel. US November crude slipped USD 1.27 to settle at USD 89.74.
Source : Moneycontrol

Government option merging FMC with Sebi to better monitor futures market

The government is considering a proposal to merge the Forward Markets Commission (FMC) with capital market regulator Sebi to ensure better monitoring of the commodity futures market.

"One of the options being considered by the government is merging FMC with Sebi," said a senior Finance Ministry official.

Alternatively, the official said, the government may also pursue the long-pending proposal to give more powers to FMC by amending the Forward Contract Regulation Act (FCRA) Amendment Bill.

While FMC is the regulator for commodities trading, while the Sebi regulates the capital markets.

The move would also help in improving the regulatory architecture for the futures commodity trading.

Earlier the Financial Sector Legislative Reforms Commission (FSLRC) had recommended that Sebi, IRDA, PFRDA and FMC should be merged into a single entity into a unified financial agency (UFA).

Last year in September the government had brought FMC under the ambit of the Finance Ministry in the aftermath of a Rs 5,600-crore payment crisis broke out at National Spot Exchange Ltd (NSEL). FMC was earlier under the Consumer Affairs Ministry.

Turnover of interest rate futures hits Rs 1.5 lakh crore in April-September

The turnover of interest rate futures on bourses nearly hit Rs 1.5 lakh crore in the first half 2014-15, even as trading value in September slipped by nearly 32 percent from the previous month level.

Trading of interest rate futures (IRF) on BSE, NSE and MCX-SX cumulatively stood at about Rs 1.48 lakh crore during April-September period.

In September, however, the total trading value on the three stock exchanges dipped by 31.8 per cent to Rs 19,516 crore over the preceding month.

Turnover of IRF cumulatively stood at Rs 28,644.62 crore in August, as per the data available with the bourses.

An IRF, generally a contract between a buyer and a seller agreeing to the future delivery of any interest-bearing asset such as government bonds, was launched on the three exchanges in January this year.

Individually, NSE accounted for the highest share (93.7 per cent) in turnover among the bourses, during the first six months of the current fiscal. The bourse recorded a turnover of Rs 1.38 lakh crore on its platform for IRF.

At the same time, the IRF value stood at about Rs 7,831 crore on BSE followed by Rs 1,413.16 crore on MCX-SX.

For September, NSE saw a IRF turnover at Rs 17,926.62 crore, down 33 per cent from the preceding month. However, the exchange is much above BSE and MCX-SX both in terms of trading value and volume in IRF.

Trading value on the BSE, last month, dropped by 9.65 per cent to Rs 1,568.41 crore.

Besides, trading in IRF on MCX-SX also saw a sharp dip at about Rs 21 crore in September from Rs 92.18 crore in August. Trading of IRFs on this exchange was above the Rs 100 crore level in the first four months of 2014-15 where in July it had recorded highest value for the fiscal at Rs 536 crore.

In terms of volume, the exchanges together traded 73.69 lakh contracts on their platforms during the first half of 2014-15, with as many as 9.78 lakh trades in the last month.

The number of trades recorded last month were 31.7 per cent lower than in August.

NSE registered trading of 69 lakh contracts, while BSE IRF volumes stood at 3.90 lakh, for April-September period.

Besides, as many as 70,473 IRF contracts have been traded on MCX-SX for period under review.

Last month, the IRF contracts traded on NSE stood at 8.98 lakh, BSE (78,484) and MCX-SX (1047).

The cash-settled IRFs provides market participants with a better option to hedge risks arising from fluctuations in interest rates, which depend on various factors including RBI policy, demand for liquidity and flow of overseas funds.

Banks, primary dealers, mutual funds, insurance firms, FIIs, corporates and brokers, as well as retail investors can trade in this product.