30 September 2010

India Morning Note - Keynote Capitals (September-30-'10)

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Views on markets today
·       Indian markets closed negative after in choppy trade yesterday ahead of F&O expiry for September series. Weak European markets also dampened investors’ sentiment. Selling pressure was seen in metal, FMCG, real estate and oil & gas stocks. However, auto and IT stocks witnessed some buying interest. Sterlite Industries tumbled 8.5% after the Madras High Court ordered closure of its copper smelting plant at Tuticorin after noting that the company has failed to comply with environmental issues. Indosolar listed at `29.80 against its issue price of `29 but the stock erased all of its gains and closed at `23.70.
·       Market breadth was negative at ~0.62x as investors sold large cap stocks. FIIs bought equities worth `7.56Cr while domestic institutions sold equities of `8.35bn.
·       The Asian markets are trading lower this morning. The Nikkei is trading lower after Wall Street took a breather from a month-long rally, with investors nervously watching moves in the currency markets. The Hang Seng is also trading negative.
·       The Indian markets are expected to open flat with negative bias. Mahindra Satyam will be in focus after the company reported a net loss for 2009 and 2010, giving the first view of its financials nearly two years after it was hit by corporate fraud.
Key events today
·       Announcement of food and fuel price inflation data
·       Opening of the IPO of Commercial Engineers & Body Builders, (Price band `125-127 per share), closes October 05.
Economic and Corporate Developments
·       Infrastructure growth in August slips to 3.7% from 4% in July.
·       Mining firms will have to pay 25% more for land and rehabilitation of local tribals, says Kantilal Bhuria, Tribals Affairs Minister.
Buzzing Stocks
·       TCS bags `2.18bn deal from Australian company, AGL and signs pact with BA.
·       Tata Steel to raise Pound 3.5bn to refinance loans taken for buying Corus.
·       JSW Steel scraps plan to buy Brahmani Steel due to mining issues.
·       Sterlite Industries plans to appeal Madras HC on the order to shut its Tuticorin copper smelters.
·       ITC to subscribe to EIH rights issue.

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