SENSEX 17151.19 -150.72
NIFTY 5188.40
-50.75
USD/INR 0053.01 +00.51
NASDAQ 3036.52 -23.33
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UPDATEDTIME 09.28 PM 03 MAY 2012
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The Nifty closed below the intermediate support level of 5,200 as a
weak rupee and lack of conviction among investors hurt sentiment.
The benchmark has drifted closer to the lower end of the trading range of 5,180-5,300 as foreign institutional investors await clarity on GAAR, a proposed retrospective taxation of cross-border transactions and a reduction in fuel subsidies. The Finance Bill will be debated in Parliament early next week.
"The market is looking forward to several policy initiatives and a lot of clarifications on various policy matters. If these things do happen, then it is quite possible that the stickiness that we are witnessing in the market would go away.
Apart from taxation issues, the rupee's depreciation has been worrying FIIs. "The value of international investors' holdings in the Indian market eroded by $9 billion in the past month when the rupee slid 4% against the US dollar.A further correction in the rupee may force investors to pull out from Indian equities to stem losses.
The rupee slipped below 53 per dollar, a new four-month low, on increased demand for the greenback from importers and foreign banks. The rupee was at 53.44 per dollar, down 48 paise, against its previous close of 52.96 per dollar.
On the rupee front, we all know the current account deficit and the trade deficit problem. Even seasonality is bad during this period of the year and we need FII flows, but FII flows have dried up over the past month. So that is putting the rupee under pressure.
The Nifty ended at 5,188.40, down 50.75 points, or 0.97 percent. It touched an intraday high of 5,217.30 and a low of 5,180.65.
The Sensex closed at 17,151.19, down 150.72 points, or 0.87 percent. It touched an intraday high of 17,271.77 and a low of 17,120.86.
5280-5300 was the likely top for this pullback rally and the rally seems to be over. Now that we are trading below 5,200 for the spot Nifty, it is a bad sign. The USD also gained in today's trade. This shows foreigners are not taking kindly to this market movements.
Chances are that they are selling and if the Nifty were to fall below 5,130 (200-DMA), you will see panic. We are probably headed for the 5,000 levels.
The BSE Midcap Index fell 1.02 percent and the BSE Smallcap Index declined 1 percent.
Among sectoral indices, the BSE Auto Index was down 2.43 percent, the BSE Metal Index declined 1.75 percent and the BSE Bankex was 1.74 percent lower. The BSE IT Index was up 0.71 percent.
Banks witnessed selling pressure following the Reserve Bank of India's directive to set aside more capital to meet the BASEL III requirements.
Our analysis shows that the Basel-III norms will not be impacting private bank ROEs as much as the public sector banks. Within the public sector banks also, there is a category of banks which will be little more impacted because of the current capital structure than others.
We continue to remain pretty positive on the private sector banks. We are extremely selective in case of PSUs.
Hero MotoCorp (7.55%), Axis Bank (3.94%), Bank of Baroda (3.39%), Maruti Suzuki (3.24%) and IDFC (2.89%) were among the top Nifty losers.
Hero MotoCorp posted a 20% increase in net profit to Rs 603 crore in the quarter ended March, narrowlymissing analysts' estimates, as higher raw material costs damped gains from record sales of bikes and scooters. Its total turnover (net sales and other income) in the fourth quarter rose 12% to Rs 6,035 crore driven by higher volume growth as sales jumped 8% to 15.72 lakh units. The company announced a dividend of Rs 45 per share.
Hero MotoCorp results were largely in line with estimates, but net profit came in 4% below estimates due to a higher tax rate, said a CLSA report.
The announcement of Rs 45/share dividend will come as a disappointment given expectations were of Rs 80 plus and it could take a toll on Hero's premium multiples.
Asian Paints (2.37%), Hindustan Unilever (2.32%), Wipro (2.05%), BPCL (0.94%) and TCS (0.74%) were the among the index gainers.
Shares of sugar companies surged higher in a weak market as sentiment turned bullish on the sector after the government removed the cap on sugar exports and placed the commodity under the open general licence category like wheat and rice.
The market breadth was negative on the NSE with 429 gainers against 1,047 losers.
The benchmark has drifted closer to the lower end of the trading range of 5,180-5,300 as foreign institutional investors await clarity on GAAR, a proposed retrospective taxation of cross-border transactions and a reduction in fuel subsidies. The Finance Bill will be debated in Parliament early next week.
"The market is looking forward to several policy initiatives and a lot of clarifications on various policy matters. If these things do happen, then it is quite possible that the stickiness that we are witnessing in the market would go away.
Apart from taxation issues, the rupee's depreciation has been worrying FIIs. "The value of international investors' holdings in the Indian market eroded by $9 billion in the past month when the rupee slid 4% against the US dollar.A further correction in the rupee may force investors to pull out from Indian equities to stem losses.
The rupee slipped below 53 per dollar, a new four-month low, on increased demand for the greenback from importers and foreign banks. The rupee was at 53.44 per dollar, down 48 paise, against its previous close of 52.96 per dollar.
On the rupee front, we all know the current account deficit and the trade deficit problem. Even seasonality is bad during this period of the year and we need FII flows, but FII flows have dried up over the past month. So that is putting the rupee under pressure.
The Nifty ended at 5,188.40, down 50.75 points, or 0.97 percent. It touched an intraday high of 5,217.30 and a low of 5,180.65.
The Sensex closed at 17,151.19, down 150.72 points, or 0.87 percent. It touched an intraday high of 17,271.77 and a low of 17,120.86.
5280-5300 was the likely top for this pullback rally and the rally seems to be over. Now that we are trading below 5,200 for the spot Nifty, it is a bad sign. The USD also gained in today's trade. This shows foreigners are not taking kindly to this market movements.
Chances are that they are selling and if the Nifty were to fall below 5,130 (200-DMA), you will see panic. We are probably headed for the 5,000 levels.
The BSE Midcap Index fell 1.02 percent and the BSE Smallcap Index declined 1 percent.
Among sectoral indices, the BSE Auto Index was down 2.43 percent, the BSE Metal Index declined 1.75 percent and the BSE Bankex was 1.74 percent lower. The BSE IT Index was up 0.71 percent.
Banks witnessed selling pressure following the Reserve Bank of India's directive to set aside more capital to meet the BASEL III requirements.
Our analysis shows that the Basel-III norms will not be impacting private bank ROEs as much as the public sector banks. Within the public sector banks also, there is a category of banks which will be little more impacted because of the current capital structure than others.
We continue to remain pretty positive on the private sector banks. We are extremely selective in case of PSUs.
Hero MotoCorp (7.55%), Axis Bank (3.94%), Bank of Baroda (3.39%), Maruti Suzuki (3.24%) and IDFC (2.89%) were among the top Nifty losers.
Hero MotoCorp posted a 20% increase in net profit to Rs 603 crore in the quarter ended March, narrowlymissing analysts' estimates, as higher raw material costs damped gains from record sales of bikes and scooters. Its total turnover (net sales and other income) in the fourth quarter rose 12% to Rs 6,035 crore driven by higher volume growth as sales jumped 8% to 15.72 lakh units. The company announced a dividend of Rs 45 per share.
Hero MotoCorp results were largely in line with estimates, but net profit came in 4% below estimates due to a higher tax rate, said a CLSA report.
The announcement of Rs 45/share dividend will come as a disappointment given expectations were of Rs 80 plus and it could take a toll on Hero's premium multiples.
Asian Paints (2.37%), Hindustan Unilever (2.32%), Wipro (2.05%), BPCL (0.94%) and TCS (0.74%) were the among the index gainers.
Shares of sugar companies surged higher in a weak market as sentiment turned bullish on the sector after the government removed the cap on sugar exports and placed the commodity under the open general licence category like wheat and rice.
The market breadth was negative on the NSE with 429 gainers against 1,047 losers.
Regards
RAKESH MAKIN
+91,
9041667797(DIRECT), 9915684997
OFF
0172-4657997
PANCHKULA (Haryana).
Email:makin_97@yahoo.com
Group mail id: makin97NSEtips@yahoogroups.co.in
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