Parliament’s Winter Session Will Sway Market Movements

 
However, the markets from here on may see huge volatility as the winter session of the parliament will take off from today and end on December 20. The government has taken efforts in the past couple of months to put an end to policy paralysis and revive the animal spirit of the economy. One should note that many of the reform measures have already been passed by the Union Cabinet and are now awaiting final approval from the parliament.

With a difference of opinion among some of the political parties, we believe that the winter session may be a difficult test for the UPA government to pass through. There are approximately 25 pending bills or amendments awaiting the green signal, some of them being related to FDI in multi-brand retail, insurance, banking laws, companies, pension fund regulation and development authority. As such, this is going to be an action-packed winter session.
 
Further, according to Business Standard, the government yesterday said that the cap on stake that state-owned Life Insurance Corporation (LIC) can hold in companies would be raised to 30 per cent from the existing 10 per cent. The new norms would enable the cash-rich LIC, which invests Rs 50,000-60,000 crore in equity annually, to pick up higher equity in state-owned companies during the disinvestment process.

Benchmark Indices
Index	Closing	% Change
SENSEX	18460	0.72
NIFTY	5615	0.78
Dow Jones	12837	0.38
S&P 500	1391	0.23
NASDAQ	2927	0.34
Bovespa	56242	-0.37
FTSE	5752	0.07
DAX	7185	0.16
CAC	3478	0.44
..
Hang Seng	21616	0.43
Nikkei	9388	1.24
Shanghai	2017	0.69

Overnight the global markets also closed higher in the positive territory. Some of the major American indices like Dow Jones, S&P and Nasdaq closed upwards in the range of 0.20 to 0.40 per cent respectively. According to a Bloomberg report, S&P 500 extended its longest rally in seven weeks while Treasuries fell for a third day and oil trimmed its earlier gains as Israel and Hamas agreed to a cease-fire after a week long conflict.

The European markets too closed higher with indices like FTSE, CAC and DAX closing their trades upwards in the range of 0.07 to 0.50 per cent respectively. According to media reports, the European stock markets ended a choppy session slightly higher up as investors stayed on the sidelines ahead of a U.S. holiday while also digesting news that the euro zone finance ministers failed to agree on conditions for further aid to Greece.

Taking some of its cues from the overnight developments in the markets, the Asian markets have also opened higher with Shanghai Composite and Hang Seng up by 0.69 and 0.43 per cent respectively while the Japanese index Nikkei is up by more than 1 per cent. According to media reports, the Asian stocks rose sharply ahead of the Chinese manufacturing data with Japan getting yet another boost as the yen extended its downward march.

Key Global Indicators
	Gold (Rs/10gm)	Crude ($/bbl)
Spot	31811	110.91
% change	-	0.05
Future	31799	87.7
% change	0.17	0.37

The rupee has again started depreciating against the dollar, raising concerns about its impact on the Indian economy. It is currently trading at Rs 55.11 against a dollar. Meanwhile, Brent crude continues to hover around USD 110 per barrel while the WTI crude is currently trading at USD 88 per barrel.

Currency Rates
	Rs/$	Rs/Euro	Rs/GBP	Rs100/JYP
RBI Rate	55.11	70.618	87.812	66.91
Future	55.1675	70.5800	87.7475	66.9975

In conclusion, we expect the markets to remain volatile for the day and investors will probably take cues from the proceedings of the parliamentary session.

FII DERIVATIVES STATISTICS FOR 21th November 2012
	BUY	SELL	OI (End of the day)		Net Position
	Rs (crore)	Rs (crore)	No. of contracts	Rs (crore)	Rs (crore)
INDEX FUTURES	1053.43	1150.43	335520	8275.77	-97.00
INDEX OPTIONS	13831.08	13681.19	1892277	53159.31	149.89
STOCK FUTURES	1918.13	1660.96	1116628	29827.14	257.17
STOCK OPTIONS	1290.39	1290.81	104317	2823.40	-0.41
Total	18093.03	17783.38	3448742.00	94085.62	309.65