India Morning Note - Keynote Capitals (March-16-'11)

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Views on markets today

·      Indian markets ended in the negative territory yesterday in line with global peers as leakage of harmful radiation from Japan's nuclear plants weighed sentiments. Indian markets settled at 2-week closing low as world stocks fell after a steep slide in Japanese stocks caused by radiation leakage after earthquake and tsunami in the country. Except oil & gas, all sectoral indices closed negative with real estate, auto metals and power stocks were major losers. Banking stocks declined after the latest data showed rise in inflation while Tyre stocks rose, extending recent strong gains, as natural rubber prices tumbled following devastating earthquake and Tsunami in Japan. Maruti Suzuki shed 3.6% on fears that the rising yen would dent its profits. However, Reliance Industries beat the trend to gain 1.8% on hopes the company would benefit from shutdown of refining capacities in Japan.

·      Market breadth was weak at ~0.43x as investors sold large cap stocks. Both FIIs and domestic institutions bought equities worth `1.48bn and `5.67bn, respectively.

·      Asian markets are mixed today as the Japanese shares showed some recovery after sharp consecutive fall over last 2 days. However, the Hang Seng down after a strong opening.

·      We expect a positive opening for the Indian markets tracking the cues from the Japanese markets. Indian markets showed some resilience yesterday to the fall of Asian markets.

Key events today

·      Opening of the IPO of PTC India Financial Services Ltd. (price band `26-28 per share), closes March 18.

Economic and Corporate Developments

·      The Union cabinet has approved the Constitutional Amendment Bill to roll out the GST.

·      The Cabinet reviewed the implementation of several projects under the Jawaharlal Nehru National Solar Mission, which aims at producing 20,000 mw solar power by 2022in the country.