Wednesday, February 25, 2009
Gold records fifth steepest fall in Mumbai
MUMBAI: After a historic northward climb, gold recorded one of the steepest falls in recent times in the domestic markets on Wednesday on the back
of firmer dollar and sliding crude prices. In Mumbai, the price of yellow metal (99.5) plunged by Rs 370 to Rs 15,335 per 10 gm.
With Wednesday’s fall, gold has become cheaper by nearly 3% from its life-time high of Rs 15,790 per 10 gm touched on February 21. The last time the Mumbai gold market saw the highest fall was on March 20, 2008 when it fell by Rs 905 per 10 gm.
The other major single-day falls were recorded on December 2, December 19 and January 13 when the yellow metal lost Rs 410, Rs 370 and Rs 335 per 10 gm, respectively.
The dealers said the market was overbought and a correction was in the pipeline. Signs of a recovery in equities also dampened the spirit of bulls in the bullion market, analysts said.
However, the fall wasn’t attractive enough to bring in buyers to stores. In fact, they made maximum gains by selling old ornaments, according to sources. “If prices fall below $935 an ounce in international markets or Rs 14,500 per 10 gm in domestic markets physical buying may revive,” said Prakash Jain, a leading bullion merchant in Mumbai’s Zaveri Bazaar.
A similar view was echoed by other bullion dealers. The lower demand has cast its shadow over imports. According to sources, February is yet to open accounts as regards gold imports despite the fact that India is the largest importer of yellow metal.
A similar trend was reflected in other metros too. Gold lost the most in Kolkata where prices plummeted by Rs 445 before closing the business at Rs 15,610 per 10 gm. While in Chennai, the yellow metal tumbled by Rs 390 to Rs 15,230, it plummeted by Rs 385 to Rs 15,400 per 10 gm in Delhi.
In the international market, which normally guides price trend here, gold bounced back from early lows as US, European stock markets retreated. In London, spot gold rose to $973.00/974.05 an ounce from Tuesday’s New York close of $962.45. In early trade, the metal fell to $950.00.
Silver also recorded a hefty fall in the absence of any trigger. Chennai markets saw the biggest fall, where ready silver (.999) plummeted by Rs 1,380 per kg to Rs 23,420 per kg. While in Delhi the white metal lost Rs 1,100 to Rs 22,000 per kg, the spot silver recorded a loss of 900 at Rs 22,000 per kg in Kolkata.
Mumbai markets aped the trend in other cities as the metal was down by Rs 770 to Rs 22,485 per kg.
Source: EconomicTimes
Read more...
of firmer dollar and sliding crude prices. In Mumbai, the price of yellow metal (99.5) plunged by Rs 370 to Rs 15,335 per 10 gm.
With Wednesday’s fall, gold has become cheaper by nearly 3% from its life-time high of Rs 15,790 per 10 gm touched on February 21. The last time the Mumbai gold market saw the highest fall was on March 20, 2008 when it fell by Rs 905 per 10 gm.
The other major single-day falls were recorded on December 2, December 19 and January 13 when the yellow metal lost Rs 410, Rs 370 and Rs 335 per 10 gm, respectively.
The dealers said the market was overbought and a correction was in the pipeline. Signs of a recovery in equities also dampened the spirit of bulls in the bullion market, analysts said.
However, the fall wasn’t attractive enough to bring in buyers to stores. In fact, they made maximum gains by selling old ornaments, according to sources. “If prices fall below $935 an ounce in international markets or Rs 14,500 per 10 gm in domestic markets physical buying may revive,” said Prakash Jain, a leading bullion merchant in Mumbai’s Zaveri Bazaar.
A similar view was echoed by other bullion dealers. The lower demand has cast its shadow over imports. According to sources, February is yet to open accounts as regards gold imports despite the fact that India is the largest importer of yellow metal.
A similar trend was reflected in other metros too. Gold lost the most in Kolkata where prices plummeted by Rs 445 before closing the business at Rs 15,610 per 10 gm. While in Chennai, the yellow metal tumbled by Rs 390 to Rs 15,230, it plummeted by Rs 385 to Rs 15,400 per 10 gm in Delhi.
In the international market, which normally guides price trend here, gold bounced back from early lows as US, European stock markets retreated. In London, spot gold rose to $973.00/974.05 an ounce from Tuesday’s New York close of $962.45. In early trade, the metal fell to $950.00.
Silver also recorded a hefty fall in the absence of any trigger. Chennai markets saw the biggest fall, where ready silver (.999) plummeted by Rs 1,380 per kg to Rs 23,420 per kg. While in Delhi the white metal lost Rs 1,100 to Rs 22,000 per kg, the spot silver recorded a loss of 900 at Rs 22,000 per kg in Kolkata.
Mumbai markets aped the trend in other cities as the metal was down by Rs 770 to Rs 22,485 per kg.
Source: EconomicTimes
Stocks Retreat After Obama Speech
This is a transcript of the Market Update: Midday video report.
Stocks retreated on Wednesday, with the Street looking for direction from Washington. President Obama's Tuesday night speech failed to move the needle on Wall Street; meanwhile, investors are watching Fed Chairman Ben Bernanke's meeting with the House Financial Services Committee.
Regulators are expected to begin stress tests of the nation's major banks to determine how much capital, if any, they need.
The housing sector digested yet another disappointing report. Existing-home sales fell 5.3% to 4.49 million, coming in below economists' expectations.
American International Group
Citigroup
On the earnings docket, it appears the cash-strapped consumer may be avoiding pricier meals for peanut butter and jelly sandwiches. Jam-maker J.M. Smucker
Bond insurer Ambac Financial Group
Source: http://www.forbes.com
Tuesday, February 10, 2009
FIIs invested Rs 368.98 cr in Indian equities
MUMBAI: Foreign Institutional Investors (FIIs) today continued their confidence in the Indian market and invested Rs 368.98 crore in
equities.
As per the provisional data available with the Bombay Stock Exchange, FIIs were the gross buyers of equities worth Rs 1,688.12 crore, while they bought shares valued at Rs 1,319.16 crore resulting in the net purchase of equities worth Rs 368.96 crore.
On Monday, FIIs had invested Rs 289.10 crore in the Indian market, the latest data available with the Securities and Exchange Board of India (SEBI) shows.
However, in today's market, Domestic Institutional Investors (DIIs) were in weak mood and offloaded equities worth Rs 116.99 crore in the market.
Following the same trend of DIIs, brokers on the behalf of their clients and non-resident Indians (NRIs) also offloaded equities worth Rs 58.90 and 0.07 crore respectively.
Meanwhile, proprietors followed FIIs' trend and invested in equities worth Rs 17.09 crore.
BSE's benchmark index -- Sensex -- today closed at Rs 9,647.47 points, a gain of 63.58 points or 0.66 per cent.
Read more...
equities.
As per the provisional data available with the Bombay Stock Exchange, FIIs were the gross buyers of equities worth Rs 1,688.12 crore, while they bought shares valued at Rs 1,319.16 crore resulting in the net purchase of equities worth Rs 368.96 crore.
On Monday, FIIs had invested Rs 289.10 crore in the Indian market, the latest data available with the Securities and Exchange Board of India (SEBI) shows.
However, in today's market, Domestic Institutional Investors (DIIs) were in weak mood and offloaded equities worth Rs 116.99 crore in the market.
Following the same trend of DIIs, brokers on the behalf of their clients and non-resident Indians (NRIs) also offloaded equities worth Rs 58.90 and 0.07 crore respectively.
Meanwhile, proprietors followed FIIs' trend and invested in equities worth Rs 17.09 crore.
BSE's benchmark index -- Sensex -- today closed at Rs 9,647.47 points, a gain of 63.58 points or 0.66 per cent.
BSE, NSE turnover jumps ahead of F&O March series
Chennai, Feb. 10 The Bombay Stock Exchange and the National Stock Exchange on Tuesday witnessed a surge in turnover, with stocks such as Unitech, GVK Power & Infrastructure, IFCI, DLF and Suzlon, Educomp Solutions attracting punters’ interest.
The BSE’s turnover jumped to Rs 3,726.87 crore from Monday’s turnover of Rs 2,836.19 crore and the number of trades went up to 23.15 lakh (18.99 lakh). The NSE saw its turnover jumping to Rs 9,723.82 crore (Rs 7,871.16 crore).
A lot of bulk deals have happened in these counters on the bourses. Ambit Securities Broking Pvt Ltd bought and sold over one crore shares of Unitech, while Morgan Stanley and Deutsche Bank were active in Educomp Solutions.
In most of these counters, Tuesday’s trading volume was much higher than their two-week average volumes.
Active counter
According to brokers, counters such as Unitech, GVK Power, IFCI, DLF, JP Associates, Suzlon, RNRL and HDIL generally traded actively in the F&O segment.
The NSE had increased the market lot for 243 stocks in the derivative segment. The upward revision ranges from two to 14 times.
Puravankara Projects saw its market lot zooming ahead 14 times to 7,000 from the current 500.
The stocks whose market lot rose 10 times are Brigade Enterprises, Development Credit Bank, IVR Prime Urban Developers, Kingfisher Airlines, Parsvanath Developers and Unitech.
IFCI’s market lot was revised upwards by eight times, while Suzlon and JP Associates lot sizes have increased six times.
“Players who built a short position in these contracts are now squaring up their positions, as from next series, they have to fork out higher margin for these contracts because of higher lot size,” said a Mumbai-based broker.
According to market participants, cross margining facility, which was available from Monday for all players on the NSE, also boosted trading volumes.
In December, SEBI allowed stock exchanges to introduce cross margining across market participants between cash and derivative markets. The facility was available only for institutional investors till recently.
Cross margining allows a market participant to reduce the margin payment required. Positions of clients in cash and derivatives segments to the extent they offset each other would be considered for cross margining.
Read more...Sensex gains on hopes RBI may cut rates
Mumbai: India’s benchmark stock index rose for a third day on Tuesday as HDFC Bank Ltd led lenders higher after a government adviser said the central bank may cut interest rates to spur the economy.
HDFC Bank climbed 3% after Prime Minister Manmohan Singh’s top economic adviser, Suresh Tendulkar, on Monday said rates may be lowered after the government announces the interim budget on 16 February. He also hinted at a new raft of stimulus measures. State Bank of India (SBI) added 1.4%.
“There are expectations of a rate cut,” said Ajay Bodke, who helps manage about $1 billion (Rs4,870 crore) in equities at IDFC Asset Management Co. Ltd in Mumbai. “We may see some stimulus measures that could be announced in the vote-on-account of the budget.”
The Bombay Stock Exchange’s (BSE) Sensex rose 63.58 points, or 0.7%, to 9,647.47. The S&P CNX Nifty index on the National Stock Exchange (NSE) climbed 14.60 points, or 0.5%, to 2,934.50.
Tax cuts would be desirable to spur demand, Tendulkar said, without elaborating. The government has already announced a $4 billion plan to invest in roads and ports, and on 2 January increased the overseas investment limit in the local corporate bond market to soften the impact of recession on India’s economy.
HDFC Bank added 3% to Rs947. SBI rose 1.4% to Rs1,164.10. The share prices are composite of BSE and NSE rates.
Sterlite Industries (India) Ltd fell 0.7% to Rs278.40. Hindalco Industries Ltd declined 2.2% to Rs44.95. Tata Steel Ltd slid 1.4% to Rs196.85.
Copper and aluminium declined in London as the global economic slowdown reduced demand for industrial metals used in buildings and cars. Copper for delivery in three months fell 1.3%, to $3,532 a tonne, as of 9.39am on the London Metal Exchange. Aluminium declined 1.2% to $1,427.25 a tonne.
Oil and Natural Gas Corp. Ltd fell 1% to Rs717.45. The company has disputed an income-tax demand for Rs6,000 crore.
Railway equipment maker Texmaco Ltd, railroad construction services company Kalindee Rail Nirman (Engineers) Ltd and Titagarh Wagons Ltd, which makes railroad cars, gained ahead of a vote on the country’s rail budget on 13 February, on expectations of winning new orders.
Texmaco gained Rs2.90, or 5.4%, to Rs56.80. Kalindee Rail added Rs10.20, or 6.9%, to Rs157.50. Titagarh Wagons rose Rs30.60, or 14%, to Rs242.10.
Read more...
HDFC Bank climbed 3% after Prime Minister Manmohan Singh’s top economic adviser, Suresh Tendulkar, on Monday said rates may be lowered after the government announces the interim budget on 16 February. He also hinted at a new raft of stimulus measures. State Bank of India (SBI) added 1.4%.
“There are expectations of a rate cut,” said Ajay Bodke, who helps manage about $1 billion (Rs4,870 crore) in equities at IDFC Asset Management Co. Ltd in Mumbai. “We may see some stimulus measures that could be announced in the vote-on-account of the budget.”
The Bombay Stock Exchange’s (BSE) Sensex rose 63.58 points, or 0.7%, to 9,647.47. The S&P CNX Nifty index on the National Stock Exchange (NSE) climbed 14.60 points, or 0.5%, to 2,934.50.
Tax cuts would be desirable to spur demand, Tendulkar said, without elaborating. The government has already announced a $4 billion plan to invest in roads and ports, and on 2 January increased the overseas investment limit in the local corporate bond market to soften the impact of recession on India’s economy.
HDFC Bank added 3% to Rs947. SBI rose 1.4% to Rs1,164.10. The share prices are composite of BSE and NSE rates.
Sterlite Industries (India) Ltd fell 0.7% to Rs278.40. Hindalco Industries Ltd declined 2.2% to Rs44.95. Tata Steel Ltd slid 1.4% to Rs196.85.
Copper and aluminium declined in London as the global economic slowdown reduced demand for industrial metals used in buildings and cars. Copper for delivery in three months fell 1.3%, to $3,532 a tonne, as of 9.39am on the London Metal Exchange. Aluminium declined 1.2% to $1,427.25 a tonne.
Oil and Natural Gas Corp. Ltd fell 1% to Rs717.45. The company has disputed an income-tax demand for Rs6,000 crore.
Railway equipment maker Texmaco Ltd, railroad construction services company Kalindee Rail Nirman (Engineers) Ltd and Titagarh Wagons Ltd, which makes railroad cars, gained ahead of a vote on the country’s rail budget on 13 February, on expectations of winning new orders.
Texmaco gained Rs2.90, or 5.4%, to Rs56.80. Kalindee Rail added Rs10.20, or 6.9%, to Rs157.50. Titagarh Wagons rose Rs30.60, or 14%, to Rs242.10.
Tatas say share pledging is a routine affair
MUMBAI: Tata Sons, the main holding company of the Tata group, has pledged shares of group companies to raise funds and will continue to do so if
the need arises, as it has adequate shareholding in most companies, as well as, high credit ratings, a senior official said.
“Tata Sons has enough stock of various group companies and will pledge shares if the need arises. Companies, such as Tata Steel and Tata Motors and others, have fixed assets which they can pledge to raise funds.... in our case (Tata Sons) we have shares, which we pledge to raise money. The practice (of pledging) is as old as the hills. There is nothing new in it,” Tata Sons’ finance director Ishaat Hussain told ET .
On Tuesday, various group companies announced further details of the quantum of shares pledged by their main promoter, Tata Sons. This included a 8.1% stake in automobile firm Tata Motors and a 3.5% holding in Indian Hotels Company, which owns the Taj Group of hotels. Tata Tea, the group’s main beverage firm, disclosed to the exchanges that its entire shareholding of 57.5% in Tata Coffee has been pledged with lenders.
This follows similar disclosures by Tata group companies such as Tata Steel, Tata Power and Tata Teleservices (Maharashtra) on Monday.
Tata Sons, which is mainly controlled by two trusts — Sir Dorab Tata Trust and Sir Ratan Tata Trust — has pledged shares of various group companies over the past five years as the tenure of most of its loans haven’t been longer than five years. Given the downturn in the stock market over the past one year, Tata Sons has often been asked to top up the security it kept with lenders as the value of the pledged shares eroded.
“But I’ve always been a good boy and followed all norms... so in the event of such events, I have topped it up,” Mr Hussain explained. “But, there is a lot of difference between a corporation pledging shares and an individual doing it,” he added.
He, however, did not quantify the amount of money raised through the pledging of shares. Tata group companies, such as Tata Steel, Tata Motors, Tata Teleservices, Indian Hotels and unlisted firms, such as retailer Trent, have raised sizeable amounts of money to meet various commitments, including large funding needs for the acquisitions of Anglo-Dutch steelmaker Corus by Tata Steel and of Jaguar Land Rover by Tata Motors. Both acquisitions were initially funded by short-term bridge loans, which were later refinanced through long-term loans. The shares pledged by Tata Sons acted as collateral for these loans.
In the recent past, Tata Steel had to raise long-term debt to refinance shorter duration loans it raised to acquire Corus Group for $12 billion. A $3-billion bridge loan to Tata Motors, used to fund the JLR acquisition, has also been refinanced.
“Although there are lot of alternate opportunities for promoter holding companies, such as FCEBs, in a tight market, such options are limited,” said Mr Hussain. “For an investor company like Tata Sons, shares of group companies are like assets which can be pledged,” he added.
Tata Sons had, in the past, looked at various options, including a perpetual debt instrument, for raising resources. “In August (last year), I was on the verge of leaving for a roadshow for such a plan. But my merchant bankers stopped me saying that the markets had crashed and a meltdown had started...we couldn’t go ahead with the perpetual debt plan.”
Last year, the RBI relaxed norms on perpetual debt instruments allowing banks and non-banking finance companies to increase their capital funds by issuing perpetual debt instruments. While finance companies were allowed to float perpetual debt to shore up capital, banks were given leeway on treating defaults on forex derivatives, an accounting relaxation to reduce bad loans in banks.
Read more...
the need arises, as it has adequate shareholding in most companies, as well as, high credit ratings, a senior official said.
“Tata Sons has enough stock of various group companies and will pledge shares if the need arises. Companies, such as Tata Steel and Tata Motors and others, have fixed assets which they can pledge to raise funds.... in our case (Tata Sons) we have shares, which we pledge to raise money. The practice (of pledging) is as old as the hills. There is nothing new in it,” Tata Sons’ finance director Ishaat Hussain told ET .
On Tuesday, various group companies announced further details of the quantum of shares pledged by their main promoter, Tata Sons. This included a 8.1% stake in automobile firm Tata Motors and a 3.5% holding in Indian Hotels Company, which owns the Taj Group of hotels. Tata Tea, the group’s main beverage firm, disclosed to the exchanges that its entire shareholding of 57.5% in Tata Coffee has been pledged with lenders.
This follows similar disclosures by Tata group companies such as Tata Steel, Tata Power and Tata Teleservices (Maharashtra) on Monday.
Tata Sons, which is mainly controlled by two trusts — Sir Dorab Tata Trust and Sir Ratan Tata Trust — has pledged shares of various group companies over the past five years as the tenure of most of its loans haven’t been longer than five years. Given the downturn in the stock market over the past one year, Tata Sons has often been asked to top up the security it kept with lenders as the value of the pledged shares eroded.
“But I’ve always been a good boy and followed all norms... so in the event of such events, I have topped it up,” Mr Hussain explained. “But, there is a lot of difference between a corporation pledging shares and an individual doing it,” he added.
He, however, did not quantify the amount of money raised through the pledging of shares. Tata group companies, such as Tata Steel, Tata Motors, Tata Teleservices, Indian Hotels and unlisted firms, such as retailer Trent, have raised sizeable amounts of money to meet various commitments, including large funding needs for the acquisitions of Anglo-Dutch steelmaker Corus by Tata Steel and of Jaguar Land Rover by Tata Motors. Both acquisitions were initially funded by short-term bridge loans, which were later refinanced through long-term loans. The shares pledged by Tata Sons acted as collateral for these loans.
In the recent past, Tata Steel had to raise long-term debt to refinance shorter duration loans it raised to acquire Corus Group for $12 billion. A $3-billion bridge loan to Tata Motors, used to fund the JLR acquisition, has also been refinanced.
“Although there are lot of alternate opportunities for promoter holding companies, such as FCEBs, in a tight market, such options are limited,” said Mr Hussain. “For an investor company like Tata Sons, shares of group companies are like assets which can be pledged,” he added.
Tata Sons had, in the past, looked at various options, including a perpetual debt instrument, for raising resources. “In August (last year), I was on the verge of leaving for a roadshow for such a plan. But my merchant bankers stopped me saying that the markets had crashed and a meltdown had started...we couldn’t go ahead with the perpetual debt plan.”
Last year, the RBI relaxed norms on perpetual debt instruments allowing banks and non-banking finance companies to increase their capital funds by issuing perpetual debt instruments. While finance companies were allowed to float perpetual debt to shore up capital, banks were given leeway on treating defaults on forex derivatives, an accounting relaxation to reduce bad loans in banks.
Wednesday, January 28, 2009
Satyam Computers
Satyam Computers will see cash-based selling today, says Siddharth Bhamre of Angel Broking, on CNBC Awaaz. There will be volatility in the stock in the range of Rs 10 one either side, he adds. He advises profit booking for those who bought it at lower levels. The stock is currently trading at Rs 55.45, up 17.6% on the BSE
Read more...Tuesday, January 27, 2009
Buy Reliance Comm, target of Rs 227: Angel
Angel Broking has maintained its buy rating on Reliance Communications with a target of Rs 227 in its January 23, 2009 research report. "Reliance Communications (RCOM) recorded a disappointing 18.8% yoy growth in Top-line in 3QFY2009. Owing to lower Margins, higher Depreciation and Taxes paid, RCOM�s Bottom-line grew by just 2.7% yoy. In fact, Profit before Tax fell nearly 5% yoy. On a qoq basis, Bottom-line fell 7.9%. Even as we maintain a Buy on the stock, with a revised Target Price of Rs 227 (Rs 451), including Rs 194 as the core business value (8x P/E multiple) and Rs 33 as the Towerco value, we expect stock price performance to remain muted in the short-term," says Angel Broking's research report.
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Read more...
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Indiabulls Securities up 15% on buyback news
MUMBAI: Shares of Indiabulls Securities rallied over 15 per cent to Rs 20 in early trade Tuesday, on the announcement that the company would
consider buyback when their board meets on Feb 2.
The company was the highest gainer on the BSE with volumes of 510,507 shares as against two week average of 31,8200 shares.
Amongst the broking firms, it would be the second firm to consider buy back of shares after Indiainfoline announced their buy back plans in December.
Source: Economic Times
Read more...
consider buyback when their board meets on Feb 2.
The company was the highest gainer on the BSE with volumes of 510,507 shares as against two week average of 31,8200 shares.
Amongst the broking firms, it would be the second firm to consider buy back of shares after Indiainfoline announced their buy back plans in December.
Source: Economic Times
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