VantageTrade Eagle Eye: GDP fell to 5.3%, the lowest level in three years

After two-day gaining streak, Nifty and Sensex ended the volatile session down on the back of weak rupee, global cues and poor Tata Motors' earnings. Nifty closed at 4,950.75, down 39.35 points or 0.79 percent. The index touched a high of 4,982.25 and a low of 4,944.90 in trade today.  Sensex ended at 16,312.15, down 126.43 points or 0.77 percent. The index touched a high of 16,428.74 and a low of 16,295.31 in trade today.

 

US markets showed a substantial move downwards during the trading yesterday with renewed concerns about the financial situation in Europe contributing to the sharp pullback. Disappointing U.S. pending home sale data also contributed to the negative sentiment. The Dow Jones industrial average lost 160.83 points, or 1.28%, to 12,419.86. The S&P 500 Index dropped 19.10 points, or 1.43%, to 1,313.32. The Nasdaq Composite fell 33.63 points, or 1.17%, to 2,837.36.

Shares of Facebook Inc are up 43 cents to $29.27 in morning trading on Wednesday. That's still down about 23% from its IPO price of $38. Facebook began trading on the Nasdaq Stock Market on May 18.

 

Asian markets went sent lower today because of fears that Europe's debt crisis is morphing from Greece to engulf bigger economies such as Spain and Italy. The cost of insuring against a Spanish default scaled a record high near 600 basis points while Italy, which is also struggling with huge public debt, saw its 10-year yields top 6 percent for the first time since January.  Japan's Nikkei 225 index was trading 1.8% lower at 8,475.75 and Hong Kong 's Hang Seng index was trading lower at 18,428.12, down 1.4%. South Korea's Kospi index was trading 1.2% lower at 1821.45. China's Shanghai index was trading at 2369, down 0.6%.

 

Indian markets also opened 1% lower today and are likely to be volatile ahead of F&O expiry today. Only around 18% of the stocks managed to trade in Green today. Sensex was down 153.91 points or 0.94% at 16158.24, and Nifty was down 44.65 points or 0.90% at 4906.10.

 

The rupee fell to a record low in opening trade on Thursday as risk aversion deepened over continued Euro zone worries, setting up expectations about potential intervention from the RBI.

At 9:00 a.m., the partially convertible rupee was at 56.47/50 per dollar, below its previous record low of 56.40 hit last week. The rupee closed at 56.23/24 yesterday.

 

Markets fell over 1.5% after Q4 GDP fell unexpectedly to 5.3%, the lowest level in three years. It was estimated to be at 6.1%.

 

Oil was down 0.24% at $87.61 per barrel. Gold was down 0.22% at $1,562.30 per ounce.

 

 

Other Economic and Political News:

• Govt. to restructure Rs.35,000cr loan of textiles sector
• Govt. to add seven quality control cells for food grains in 12th five year plan
• New Companies Bill likely to be passed in monsoon session: R P N Singh
• Morgan Stanley gets banking license from RBI
• Power Grid to raise up to Rs.100bn rupees in bonds
• TCS bags United Steel's SAP solutions agreement

 

 

 

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VantageTrade Eagle Eye: Markets fall on weak rupee and global triggers

Nifty and Sensex managed to finish yesterday in positive terrains after a volatile trading session during which the markets pared all gains. IT and realty stocks provided support to the markets thanks to global trends whereas FMCG stocks weighed on the markets. Market is expected to take further cues from India’s Q4 GDP number which scheduled to be released on coming Thursday ie on the day of May series expiry.

Nifty ended up 4.45 point today, to close at 4990.1. Sensex ended up 21.74 points, at 16,438.58.

US markets rose yesterday on signs that Greece would stay in Euro zone. However, Facebook Inc shares dropped below $29 to a new low on Tuesday as nervous investors fled the company's shares, concerned about the social network's long-term business prospects and an initial offering price that proved too rich.  The Dow Jones industrial average rose 125.86 points, or 1.01%, to 12,580.69. The S&P 500 Index added 14.60 points, or 1.11%, to 1,332.42. The Nasdaq Composite gained 33.46 points, or 1.18%, to 2,870.99.

Asian shares opened lower today, on the back of growing fears that Spain's banking woes will push up the country's borrowing costs to unsustainable levels. However, the losses were controlled by the reports that Greece would stay in Euro zone and China's stimulus steps. Japan's Nikkei 225 index was trading 0.9% lower at 8,579.75 and Hong Kong 's Hang Seng index was trading lower at 18,698.12, down 1.8%. South Korea 's Kospi index was trading 1% lower at 1831.45. China 's Shanghai index was trading at 2384, down 0.2%.

Nifty and Sensex also decreased, following Asian peers and global risk aversion and rupee that opened weaker today, at 56.01/04 per dollar, weaker than its 55.66/67 close on Tuesday. Sensex opens 100 points down at 16399 and Nifty at 4950, down 31.20.

Auto and banking stocks are hit the worst today. Tata Motors, Mahindra, & Mahindra, Bajaj Auto, Hero MotoCorp, Apollo Tyres and Exide Industries are among the losers. From the banking space, Axis Bank, Indusind Bank, IDBI Bank, Bank of India, Canara Bank, Yes Bank, Union Bank and Punjab National Bank are the top losers.

 Tata Motors is the top loser from the auto pack. The stock has plunged 8.2% to Rs 253 after reporting a 30 basis points decline in EBIDTA (earnings before interest, taxes, depreciation, and amortization) margin for Q4FY12 to 14.3%. The market expected a jump of over 100 basis points.

Aban Offshore, Anant Raj Inds, Colgate Palmolive, Jaiprakash Associates, DLF, Financial Technologies, Gail India, Godrej Inds, HDIL, Jindal Saw, Mahindra & Mahindra, Parsvnath Developers, PTC India, Rajesh Exports and Spicejet are among the many to announce their numbers today.

 BHEL said that it has commissioned a 250 MW unit at Parichha Thermal Power Station in Uttar Pradesh. This would result in generation of 6mn units of electricity that would be supplied to the grid every day.

Ritesh Idnani, senior vice-president and chief operating officer of Infosys BPO arm, has resigned.

Other Economic and Political News:

• Foreign retail investors can buy US$1bn Indian corporate debt: Govt.

• High Govt. borrowing may crowd out private sector: RBI

• Air India board refers Boeing compensation issue to Govt.

• Jindal Steel's US$2.1bn project gets Bolivian boot

• JSPL buys 10% in Gujarat NREs Oz unit

• Bharat Forge to sell loss-making US unit

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