Indian Market May Cut Losses, Open Positive
DSIJ Intelligence / 23 Mar 2012
Indian markets may cut back yesterday’s massive losses and open positive. The SGX Nifty is trading up by 22 points at 5260 indicating a gap up opening to markets today.
Opening Bias
Indian markets may cut back yesterday’s massive losses and open positive. The SGX Nifty is trading up by 22 points at 5260 indicating a gap up opening to markets today.
| Benchmark Indices | ||
|---|---|---|
| Index | Closing | % Change |
| SENSEX | 17196.47 | -2.30 |
| NIFTY | 5228.45 | -2.54 |
| Dow Jones | 13046.14 | -1.27 |
| S&P 500 | 1392.78 | -0.72 |
| NASDAQ | 3063.32 | -0.39 |
| Bovespa | 65828.20 | -1.54 |
| FTSE | 5845.65 | -0.79 |
| DAX | 6981.26 | -1.27 |
| CAC | 3472.46 | -1.56 |
| LIVE | ||
| Hang Seng | 20680.93 | -1.06 |
| Nikkei | 10014.57 | -1.11 |
| Shanghai | 2360.65 | -0.64 |
On the global front, U.S. stocks dropped for yet another day, with the S&P 500’s extending its losses into a third-straight session as manufacturing contracted in China and Europe and FedEx Corp. (FDX) tumbled amid a disappointing forecast. Asia markets sunk in early trading, tracking losses from U.S. shares on concerns about slowing global growth, and with a stronger yen weighing on Japanese exporters.
Despite the negative global sentiments the Indian equity markets may open positive as investors and traders resort to short covering after the CAG in its note to the PMO has blatantly refuted all media claims about the alleged Rs 10.7 lakh crore allocation of coal block scam, which saw the markets fall the most in Asia. The SENSEX fell by more than 2 per cent or 405 points as investors and traders on D-street panicked. This denial by CAG calling the report misleading and half-baked may come as a huge respite for the govt. as well the dampened markets sentiments. But the overhang of a possible miss-allocation of coal blocks will continue to lurk on investors mind.
In conclusion, for today we expect markets remain positive as traders and investors joy over the denial of the CAG report. It would do well for our readers to pick up the PSU and private corporate counter who have allocated mining blocks in their name and who witnessed a heavy fall yesterday owing to the misleading reports. There is a high possibility that these counters may see some positive action.
Stocks In Action
According to a regulatory filing on the BSE, state-run transmission utility Power Grid Corp’s board has approved investment proposals worth Rs 698.12 crore. Power Grid would invest Rs 213.78 crore for line bays and reactor provisions at the company substations in western region & northern region. The entity would put in another Rs 145.71 crore for line bays and reactor provisions at its substations western region. Both these projects would be completed in 24 months. Another proposal worth Rs 206.44 crore is for common transmission scheme associated with ISGS Projects in Vemagiri area of Andhra Pradesh - Part - A1. This would be commissioned in 27 months. Additionally, the company would pump in Rs 132.19 crore for supplementary transmission scheme of upcoming Independent Power Producers (IPP) projects in Chhattisgarh and the commissioning schedule is 24 months.
According to press release on the BSE, engineering and construction major L&T’s construction division has secured orders worth Rs 1,120 crore so far this month, a large chunk of which came from abroad. The company said power transmission and distribution vertical under L&T Construction has secured orders worth Rs 548 crore order from Abu Dhabi Water & Electricity Authority. This is for construction of 220 kv overhead lines, switching solutions and other related electrical works.
According to filing on the exchanges, line pipe maker Welspun Corp has bagged pipes and plates orders worth Rs 1,217 crore from national and international markets. With the addition of these orders, the current order book of the company stands at Rs 6,241 crore (approx. 876 KMT for pipes and external plate orders of 92 KMT,) without excluding the orders being executed in Q4 FY2012.
According to Business Standard, in order to address shortage of liquified natural gas (LNG) supply, state-run Indian Oil Corporation (IOC) signed an agreement with the Tamil Nadu Industrial Development Corporation for setting up a Rs 4,500-crore LNG terminal. Stating that the project would initially have a capacity of about 5 million tonne, IOC said the plant may be scaled up to 10 million tonne whenever there is an increase in demand. For importing the LNG, IOC would either go for a long term contract and the other possibility is to buy through on the spot basis.
In a stark rejection of the CAG report pegging Rs 10.67 lakh loss to the exchequer on account of coal allocation during that period state-run NTPC has maintained that it has not reaped any windfall profit from the coal mines allocated during 2004-09. In an interview with media persons, NTPC Chairman and MD Arup Roy Choudhury strongly said that there is no way by which NTPC can make windfall profit out of the coal produced from these mines as under the CERC regulated regime the cost of coal from these mines will be pass-through in the power tariff.
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