Keynote Capitals (June-27-'11) Views on markets today

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Views on markets today

·      Indian markets raced to attain their highest closing level in almost 1-1/2-week and closed significantly higher on Friday on support from global markets that displayed some relief after Greece reached an agreement with the European Union and the International Monetary Fund for an austerity plan to avoid a debt default. Except consumer durables, all sectoral indices closed higher with real estate, metal, IT and capital goods stocks were major gainers. Infrastructure and construction shares surged after the government said it has finalized the broad structure for setting up the planned $11bn infrastructure debt fund that is aimed at financing the massive overhaul of the country's creaky infrastructure. Sugar producers rose for the second day after the government on Thursday allowed another 500,000 tonnes of sugar exports. Hero Honda Motors surged over 6% after the company said its promoter group firm Hero Investments revoked 3.46Cr pledged shares. State-run oil marketing companies Indian Oil, BPCL and HPCL, which would benefit from any increase in fuel prices, were up between 2.46-6.14%. SpiceJet gained 19.85% after the company said it has sought the central bank's approval to raise $270mn from Canada's export finance agency Export Development Canada (EDC) for aircraft purchases.

·      Market breadth was strong at ~2.33x as investors bought large cap stocks. FIIs bought equities worth `8.90bn while domestic institutions sold equities of `4.86bn.

·      Asian markets are declined today as the energy stocks along with banks lost ground with declining oil prices. This is inline with the drop in US markets on Friday.

·      We expect weak openings for the Indian markets as the cues from Asian markets are not encouraging as well as fear of rising inflation increases among the investors.

Key events today

·      Opening of the IPO of Readymade Steel India Ltd. (price band `90-108 per share), closes June 29.

Economic and Corporate Developments

·      Describing the government's decision to raise prices of diesel, cooking gas and kerosene as inevitable, the Prime Minister's economic advisor today said that it would push inflation into the double-digit zone.

Keynote Capitals (June-27-'11):: Buzzing Stocks

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Buzzing Stocks

·      Emami is getting ready for making a foray into food and beverage segment by testing waters with a glucose-based drink, thereby joining the league of GlaxoSmithKline and Rasna to energise the Rs6bn glucose drink market.

·      Looking to diversify into power generation, REC plans to set up renewable energy projects entailing an investment of about Rs28bn in the next five years.

·      Tata Steel and SAIL's equal joint venture, S&T Mining Company, will set up a 1.8-million-tonnes per annum (mtpa) coal washery at Bhelatand, in Jharkhand, through an investment of Rs2bn.

·      Shriram Transport Finance Company is planning to infuse around Rs10bn in its subsidiary Shriram Equipment Finance Company (SEFC).

·      ICICI Bank plans to add about 1,500 branches over a period of four years against the existing strength of about 2,500.

·      Indian Oil Corporation oil refinery plant at Paradip, which has a capacity of 15 mn tonnes per annum, is likely to be commissioned by the end of 2012.

·      L&T plans to invest about Rs850bn in Orissa in aluminium, power and steel sectors.

Keynote Capitals (June-24-'11) Views on markets today

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Views on markets today

·      Indian markets gained the most in three weeks and closed on positive note yesterday as investors looked for bargains in battered down stocks, with Reliance Industries leading the gains after a disappointing performance in the year so far. The markets have ignored the rise in food inflation which has increased to two-and-half month high at 9.13% against 8.96 per cent. The Finance Minister has said the inflation levels were not acceptable and efforts are being made to bring them down. However, macro economic factors such as inflation and high interest rates are expected to keep the institutional investors on sidelines. Except real estate and pharma, all sectoral indices closed positive with consumer durable, FMCG, oil & gas and IT stocks were major gainers. Shares of oil marketing companies were in action after ET Now reported that the Oil Ministry is seeking to scrap customs duty on crude and excise duty on diesel. IT stocks also gained after the industry body said demand for outsourcing services remains strong. Maruti Suzuki closed 2.1% lower after its parent Suzuki Motor Corp's CEO acknowledged the risk that inflationary pressures may dampen Indian consumer spending and said that he was projecting slightly weaker sales this year than Maruti's official forecasts.

·      Market breadth was however weak at ~0.72x as investors sold large cap stocks. Both the FIIs and domestic institutions bought equities worth `2.29bn and `2.41bn respectively.

·      Asian shares rise in early trading, with Japanese exporters led the gains in the gains in the Nikkei while the Hang Seng is strong.

·      We expect a positive opening on account of strong Asian markets and falling crude prices. However, the food inflation rise that announced yesterday may keep gains in check.

Economic and Corporate Developments

·      Food inflation in the country touched a two-and-half-month high of 9.13% in the week ended June 11 against 8.96% for the previous week on the back of costlier fruits, milk, onions and protein-based items.

Buzzing Stocks · 24 June 2011: Keynote,

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Buzzing Stocks

·      CBI to investigate investments made by the UB group and India Cements in Kalaignar TV.

·      Andhra HC stays govt order on land for Nagarjuna Construction could deal a blow to the company that proposed a 2640mw power plant costing `12000Cr.

·      BEML has signed MoU with Italian aerospace major Alenia Aeronautica to design, manufacture and sell a basic trainer aircraft.

·      Talwalkars Better Value Fitness has forayed into franchises business. The company has decided has opened its first gym in Pune on franchisee basis, under the brand name 'Hi-Fi'.

·      MMRDA penalizes Jet Airways with a levy of 18% pa failing to pay `826Cr for the BKC plot.

·      SpiceJet seeks RBI approval to raise `1212Cr from Canada’s export finance agency export development for financing fleet expansion.

·      Honda Motorcycle & Scooter India, a subsidiary of Honda Motor co to invest `1400Cr to ramp up its manufacturing capacity.

·      Hero Investments revokes 17.33% stake in Hero Honda without disclosing the value.

(June-23-'11) Buzzing Stocks - Keynote Capitals

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Buzzing Stocks

·      Tata Steel has received about $130mn (`5.8bn) in an arbitration settlement between its UK subsidiary and a consortium of international buyers that broke an off take agreement with its TCP plant in England.

·      Reliance Industries' partner Hardy Oil and Gas Plc has made a natural gas discovery on the D9 block in the Krishna Godavari basin.

·      Saab AB has entered into an agreement with Mahindra Satyam to establish a joint technology centre at one of the IT solutions provider’s facilities.

·      Punjab National Bank may raise `20bn from bonds by the end of the current fiscal.

·      NHPC will invest `24bn on setting up three projects in J&K under a joint venture with Jammu & Kashmir State Power Development Corporation and PTC India.

·      Dr Reddy's Laboratories has launched Levofloxacin tablets, an antibiotic for treating bacterial infections in the US market.

(June-23-'11) India Morning Note - Keynote Capitals

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Views on markets today

·      Indian markets ended sluggish session on a flat note yesterday as investors chose to stay away on concerns of macro-economic issues like below normal rainfall, high inflation and interest rates. Foreign fund outflows as rising borrowing costs and stubborn inflation chipped away investor confidence, leading to a bleak near-term outlook. Weak European shares, ahead of a US Federal Reserve policy meeting, also weighed market sentiments. Investors are waiting for some trigger, in the form of global event or government policies to get some direction on either side. The downward movement was mainly led by selling pressure in consumer durables, real estate, FMCG and metal stocks while oil & gas, capital goods and banks stocks witnessed some buying activities which gave some support to the markets. Sun Pharmaceutical rose 1.4% after its unit received approval from the US FDA to market a generic version of sumatriptan succinate injection that is used in the treatment of migraine. Four Soft rose 6.5% after the company signed a deal with Mexico-based Logistics Dynamic Corp to implement freight management solution. Timbor Home makes its debut in strong note and closed at `91.20, a premium of 44.76% over issue price of `63 a share with huge volume.

·      Market breadth was however weak at ~0.57x as investors sold large cap stocks. FIIs sold equities worth `2.87bn while domestic institutions bought equities of `1.57bn.

·      Concerns over the US economy dampened the investor’s sentiments over progress for Europe’s debt problems, pressuring Asian markets today. Both the Nikkei and the Hang Seng are down.

·      Asian markets indicate a weak opening for the Indian markets. Today's announcement of weekly inflation data may further push volatility in the markets.

Key events today

·      Closing of IPO of Birla Pacific Medspa Ltd. (subscribed 0.70x as of June 22, 5PM) and Rushil Decor Ltd. (subscribed 0.86x as of June 22, 5PM).

Economic and Corporate Developments

·      India’s engineering exports registered growth of 119.4% to $7.9bn in May (yoy), driven mainly by an increase in demand from US and Europe markets.

Buzzing Stocks · June 22: Keynote

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Buzzing Stocks

·      Lanco Infratech has bagged its first international contract in EPC segment for a gas-based thermal unit at 3.65bn in Iraq’s Al Anbar province.

·      Aditya Birla Group has completed the acquisition of the Atlanta based Columbian Chemicals Company for $875mn.

·      SBI reduced loans growth target for the fiscal by as much as 6% as companies and individuals cut down demand for funds due to soaring interest rates.

·      L&T has bagged EPC orders from member-countries of the Gulf Cooperation Council of Rs13.66bn.

·      GAIL is looking to expand rapidly in areas of city gas distribution and related pipeline infrastructure through tie-up with various state government entities.

·      KEC International has bagged orders worth Rs10.44bn which includes two transmission line projects in Saudi Arabia and Kuwait.

·      The CBI has closed its probe into Idea Cellular after it found no evidence of wrong doing.

Views on markets today · June 22: Keynote

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Views on markets today

·      Indian markets snapped three day losing streak and closed positive yesterday largely helped by gains in beaten-down Reliance Industries and export-driven software firms following firmer world markets. The markets also got support from the positive European markets ahead of the crucial Greece Confidence vote. The optimism that the Greek government would push through austerity measures to pave the way for a second bailout loan pushed global markets in positive territory. But, stock prices came off intraday highs after Finance Minister said that the government has resumed talks with Mauritius on a double taxation avoidance agreement. The upward movement was mainly led by gain in IT, oil & gas, pharma and auto stocks while real estate, capital goods, FMCG and power stocks witnessed some selling pressure. GTL and GTL Infra, which had both slumped in the previous session on concerns about debt repayment, pledged shares and fund raising, extended losses despite the chairman's assurances that it had not defaulted and that its business fundamentals remain strong. Lupin gained 0.9% after the US FDA said it approved their generic versions of antibiotic levofloxacin, which treats certain infections.

·      Market breadth was however weak at ~0.67x as investors sold large cap stocks. FIIs sold equities worth `5.63bn while domestic institutions bought equities of `4.31bn.

·      Asian shares posted solid gains on Wednesday, extending an advance made in the previous session as investors gained confidence that Greece issue will be resolved. Both the Nikkei and the Hang Seng are strong today.

·      We expect a positive opening for the Indian markets as the cues from the Asian markets are encouraging. However, the lack of investor confidence which was indicated through yesterday's inverted U turn of the Sensex makes it highly vulnerable. Domestic conditions, particularly relief from the high inflation levels does not seem to be in a near future. We may see some selling pressure on the higher levels.

Economic and Corporate Developments

·      Fitch has retained India’s sovereign rating at investment grade, stating it has “robust growth prospect” and solid external financial condition.

Buzzing Stocks · -(June-21-'11) Keynote Capitals

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Buzzing Stocks

·      GTL group hammered on fire sale rumours reports of sale of promoters’ pledged shares by lenders spook investors.

·      HCL Technologies has signed a five-year global product engineering services partnership agreement with Xerox Corporation.

·      Delhi Cargo Services Center has signed up Siemens Ltd for contract worth`.1.65bn to set up cargo handling equipment for the integrated cargo complex at the Delhi International Airport.

·      Shriram Transport Finance Company has planned to raise`10bn by issuing secured non-convertible debentures.

·      M&M is putting together plans to set up new plant to exclusively manufacture different farm equipment, both in the pre-harvest and post-harvest segments.

·      Glenmark’s US subsidiary Glenmark Generics has received US health regulator’s approval to market its generic oral contraceptives tablets in the American market.

India Morning Note -(June-21-'11) Keynote Capitals

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Views on markets today

·      Indian markets ended sharply lower yesterday to their lowest close in more than four months as reports of renewed treaty between India and Mauritius on taxations issue spooked sentiments and triggered profit booking across the board. The reports rattled the markets given that a big chunk of India's foreign direct investment (FDI) and FII money comes from Mauritius. Talk of the treaty review further hurt sentiment in the markets that was already jittery due to stubborn inflation and slowing growth. Weak cues from European markets due to uncertainty over a long-term fix for Greece's debt issues also put pressure on the markets. All sectoral indices closed on negative tone with real estate, oil & gas, IT and auto stocks were major losers. Software firms led the decline, after CLSA downgraded the Indian IT sector to "underweight" from "neutral," saying their quarterly revenue growth on an annual basis has peaked and a downtrend was likely. It also downgraded TCS and Infosys to "underperform", sending their stocks down 3.6% and 2.2%, respectively. Bharti Airtel gained 2.4% after data from an industry body showed the company has signed up 2.45 million mobile subscribers in May, taking its total to 167.1 million.

·      Market breadth was weak at ~0.24x as investors sold large cap stocks. FIIs sold equities worth `5.12bn while domestic institutions bought equities of `8.63bn.

·      Asian markets are positive today showing a mixed trend after the positive close of the US markets. While the Nikkei is strong, Chinese stocks on the Hong Kong and Shanghai markets shown declining trend after a positive opening.

·      We expect a positive opening for the Indian markets following the cues from the Asian markets. However, speculations regarding the review of the Mauritius tax treaty may keep investors away from the markets and we may see a limited upside.

Economic and Corporate Developments

·      Govt likely to permit FDI in multi brand retailing only in the six big metros keeping other cities out.

·      Fertiliser Ministry has sought clarifications from the Committee of Secretaries on a proposal to hike urea prices by 10% in the draft policy on urea decontrol.

SKIP / AVOID the IPO of Birla Pacific Medspa - keynote

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 note of the IPO of Birla Pacific Medspa Ltd.

Issue Highlights

Price Band                                                 :       Rs10 – 11 per share

Minimum Bid Lot Size                               :       500 Equity Shares

Maximum Bid Lot Size                               :       18,000 Equity Shares

IPO opens during                                       :       June 20 – 23, 2011

Book Running Lead Manager                     :       Arihant Capital Markets Limited

To list on                                                   :       BSE

IPO Grading                                               :       2 / 5 (Brickworks Ratings)

Market Cap post-listing                              :       Rs116.84Cr or $26mn (based on the cap price)

Market Cap of Free Float                            :       Rs83.38Cr or $18.6mn (based on the cap price)      

IPO of 59.25mn equity shares of Rs10each, aggregating to Rs65.18Cr or $14.5mn (at the cap price).

Executive Summery

Ø  Birla Pacific Medspa Ltd. (BPML) operates Spas in India and abroad for beauty and healthcare treatment and presently operates a med spa centres under the brand name “EVOLVE”. A med spa or medical spa is a hybrid between a medical clinic and a day spa and operates under the supervision of medical doctor.

Ø  Evolve Med Spa, offers comprehensive treatments in the areas of Cosmetic Dermatology, Cosmetic Surgery and Advanced Dentistry. It also offers a range of spa services – wet & dry under its wellness initiative.

Ø  The health industry has emerged as one of the most challenging sectors as well as one of the largest service sector industries in India with estimated revenue of $35bn; it constitutes 5.2% of India’s GDP and employs 4mn people.

Ø  The healthcare industry in the country, which comprises hospital and allied sectors, is projected to grow 23% per annum to touch $77bn by 2012 from the current estimated size of $35bn, according to a Yes Bank and an industry body report published in November 2009.

Our View

Though, the company is in fast growing sector in India, the current poor financial performance as well as the negative growth of group companies we advise the investors to skip the issue.

Keynote Capitals (June-20-'11) Buzzing Stocks

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Buzzing Stocks

·      IFLS is arranging $1.2bn for a Malaysian free trade zone project called the Tanjong Agas Supply and Marines Services near KualaLumpur.

·      Tata Motors secured an order for 10 hybrid buses from Spain.

·      The Apollo Hospitals Group will hive off its pharmacy business into a separate entity in the next 18 months.

·      Manappuram General Finance is planning a `7.5bn non-convertible debenture issue in July to meet its business requirements.

·      Tata Steel has decided to divest its entire 26.72% stake in Riversdale Mining for `50.11bn to Rio Tinto.

·      Adani Power hired three banks to help it borrow $500mn in a term loan.

·      Hero Honda Motors, the world’s largest two-wheeler company by volume, on Friday got shareholders approval to change its name to Hero Moto Corp.

India Morning Note - Keynote Capitals (June-20-'11)

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Views on markets today

·      Indian markets ended in the negative territory on Friday, extending losses for third consecutive session as concerns slow-down in economic growth due to further rate hike by the RBI and deteriorating debt crisis in Greece hurt sentiments. Sustained selling by foreign funds over the past few days also hit sentiment. The downward movement was mainly led by selling pressure in IT, oil & gas, pharma and auto stocks while consumer durables, banks and power stocks witnessed some buying activities which gave some support to the markets. Export-oriented software firms were the top losers on concerns that a global economic slowdown would hit their revenue. Telecom service providers rose on hopes that operators could be considering a tariff hike following Tata DoCoMo's decision to raise headline pre-paid tariffs in Tamil Nadu circle. Maruti Suzuki initially rallied 3.3% after a 13-day strike ended, but soon faltered and closed down 2.4% as the workers agitation at a plant in northern India had caused a production loss of more than $90mn.

·      Market breadth was weak at ~0.49x as investors sold large cap stocks. Both the FIIs and domestic institutions sold equities worth `3.91bn and `35.37Cr respectively.

·      Asian markets opened week upbeat, with the latest news from Europe sparking hope of a resolution to Greek fiscal problems there. However, the concerns regarding slowing US economy restricted the gains. Both the Nikkei and the Hang Seng are up today.

·      We expect a firm opening for the Indian markets today as the morning cues from the Asian markets are encouraging. However, investor’s confidence towards the long term investing will come with improved domestic economic data.

Key events today

·      Opening of the IPO of Birla Pacific Medspa Ltd. (price band `10-11 per share), closes June 23.

·      Opening of the IPO of Rushil Decor Ltd. (price band `63-72 per share), closes June 23.

Economic and Corporate Developments

·      Advance tax payments by Indian industry have risen 76.8% during the fiscal first quarter, picking up momentum from the preceding quarters.

Keynote Capitals (June-17-'11) Buzzing Stocks

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Buzzing Stocks

·      Tata Steel board has decided to sell its entire stake of 26.27% in Riversdale Mining for AUD$1.06bn.

·      Suzlon Energy has received an order from Nalco to supply turbines for Nalco’s proposed project in Andhra Pradesh.

·      NMDC finalises `3000Cr pipeline project for evacuating ore from its mines in Chattisgarh to Visakhapatnam.

·      Piramal Healthcare set to strengthen its global presence with acquisitions in talks with global players to acquire contract research facilities & critical care business.

·      GTL Infra scraps the plan to raise about $300mn on the back of adverse market conditions.

·      Coal India wants to lift the 10% cap on e-auction & intends to sell entire production through E-auction.

·      Infosys Technologies receives approval to change its name to Infosys Ltd.

India Morning Note - Keynote Capitals (June-17-'11)

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Views on markets today

·      Indian markets ended on negative note to its 3-week low yesterday after the RBI raised rates for a 10th time in 15 months and signaled more tightening was on the way, playing down slowing growth. The RBI raised key lending rate viz. the repo rate by 25 basis points to 7.5% in its mid-quarter monetary policy review to tame inflation. Although the 25 basis points (bps) increase was expected, the RBI’s comments were hawkish and pushed shares lower for the sixth time in seven sessions. The fall in global markets on Greek's debt problems added more pressure on Indian markets. All the sectoral indices closed negative with IT, capital goods, metal and consumer durables stocks were major losers. IT stocks fell on weak economic data in the US and on continuing sovereign debt crisis in Europe. While metal stocks fell as metal prices declined on the London Metal Exchange. Reliance Industries fell 1.4% after HSBC downgraded the energy major to "neutral" from "overweight" and cut the price target to `1,040 from `1,084. L&T shed 2.3% on concerns rising interest rates could hurt order inflow for the engineering and construction firm.

·      Market breadth was weak at ~0.62x as investors sold large cap stocks. FIIs sold equities worth `5.99bn while domestic institutions bought equities of `2.86bn.

·      Asian markets are down today as investors worried about Europe's debt troubles and uncertainty on the progress of the US economic recovery increased. Japanese shares are flat today while the Hang Seng is weak on account of downbeat tech stocks.

·      We expect a weak opening for the Indian markets as the Asian markets are down. The markets may also react negatively to yesterday's rise in repo rate and higher food and fuel inflation.

Economic and Corporate Developments

·      The Reserve Bank of India raised repo rate by 25bps to7.50% and reverse repo rates by 25bps to 6.50% in a move to arrest surging inflation.

·      DoT asks TRAI to reconsider its recommendation to cancel 69 licences of five operators, only 15 licences required to be scrapped.

·      Govt orders probe on the alleged cartelization in sugar industry after the sharp spike in sugar prices.

Buzzing Stocks · 15 June 2011: Keynote,

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Buzzing Stocks

·      The excise and taxation department of Punjab has selected Wipro to deploy tax management system across the state.

·      Tata Steel and Jindal Steel & Power will use the large inferior coal deposits in the country to produce ultra clean liquid fuels such as diesel and naphtha to meet growing energy demands.

·      Suzlon Energy's subsidiary, Suzlon Wind Energy Corp, received an order for 15S97-2.1 MW wind turbines for Amherst Project in Nova Scotia.

·      Coal India has assured the government that it will make efforts to increase coal availability to users by 28mn tons in FY12.

·      Dr Reddy's Laboratories said its Mexican arm has received a warning letter from the US health regulator for violation of current good manufacturing practice regulations.

·      Power Grid Corporation of India will be competing for a domestic contract with Indian and foreign rivals for the first time since its inception.

·      HPCL is to soon create a subsidiary to hold its exploration and production assets and those of Prize Petroleum.

India Note - Keynote Capitals (June-15-'11)

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Views on markets today

·      Indian markets snapped four days losing streak and closed on a positive note yesterday tracking firm global markets. However, the outlook remained downbeat after inflation came in well above expectations. The WPI based inflation climbed to 9.06% in May, with a sharp rise in manufacturing inflation from the previous month offsetting a slowdown in the rise of food and fuel prices and adding to the likelihood of a rate increase by the RBI. India's economy is beginning to show signs of slowing despite inflation that is racing well above the central bank's comfort zone, putting policymakers in a tight spot over the extent of further interest rate increases. Except consumer durable and oil & gas, all sectoral indices closed positive with capital goods, power, FMCG and banks stocks were major gainers. Suzlon Energy gained 0.9% after the company’s North American unit got a 31.5 mega watt order from Canada-based Sprott Power Corp. While Idea Cellular firmed 1.8% after it reported a better-than-expected 3% rise in consolidated quarterly profit, helped by strong subscriber growth and steady call prices.

·      Market breadth was strong at ~1.35x as investors bought large cap stocks. FIIs sold equities worth `7.98bn while domestic institutions bought equities of `6.11bn.

·      Asian markets are mixed today as Japanese shares are positive while the Hang Seng is weak. The markets have ignored the pull back rally in the Us markets overnight.

·      We expect a flat opening for the Indian markets as the cues from the Asian markets lack direction. A high level of the inflation is a major concern which may keep the investors away from investing in the risky assets such as equities.

Key events today

·      Announcement of advance tax number by corporates

Economic and Corporate Developments

·      India's wholesale price index (WPI) rose an annual 9.06% in May, driven by higher manufactured goods prices.

Keynote Capitals (June-14-'11) Buzzing Stocks

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Buzzing Stocks

·      Tata Communications has increased its effective holding in South Africa's second-biggest fixed-line phone operator Neotel to 61.5% from 49%.

·      Reliance Communications has protested BSNL's move to pull the plug on interconnections between networks of both companies in Punjab and Haryana last month over a financial dispute.

·      L&T has bagged a `1.10bn order from the West Bengal State Electricity Distribution Company to supply energy meters.

·      The Goldman Sachs unit picked up 9.1% stake in Max India for about `5.22bn (US$116mn).

·      Gitanjali Gems has acquired Italy-based jewellery firm DIT Group SpA for US$11mn.

·      Punj Lloyd has won an EPC nuclear power contract from NPCIL worth `6.78bn for critical nuclear piping work at four pressurised heavy water reactors of 700 MW each.

·      Hindustan Zinc has hiked the price of lead by 2.6% to `1,32,000 per ton in sync with the rise at the London Metal Exchange.

India Morning Note - Keynote Capitals (June-14-'11)

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Views on markets today

·      Indian markets ended on flat note, yesterday as the market sentiments was cautious ahead of inflation data as investors prepared themselves for a tighter monetary policy this week. It is expected that the RBI may lift interest rates this week to control accelerating inflation, curbing growth. However, the markets recovered all its loses on positive European markets. Investors are waiting for monthly inflation data for May, advance quarterly taxes that companies will pay and the RBI’s policy review, which will provide more cues in the near term. The recovery was mainly led by gain in consumer durable, power, capital goods and pharma stocks while, metal, oil & gas, real estate and FMCG stocks witnessed some selling pressure and restrict the market to close positive. Reliance Industries declined 1.84% on reports oil regulator DGH has refused to accredit three natural gas discoveries made by the company at its KG-D 6 block, where revival of the sagging output depends on production from new finds. Punj Lloyd jumped 7.7% after it said its group got a contract worth `6.78bn from Nuclear Power Corporation of India.         

·      Market breadth was marginally strong at ~1.04x as investors bought large cap stocks. FIIs sold equities worth `3.04bn while domestic institutions bought equities of `27.34Cr.

·      Asian markets are flat to positive today after a weak opening. The Hong Kong shares pared early losses after China's consumer inflation data came in roughly in line with expectations. Japanese shares are trading volatile.

·      We expect a flat but positive biased opening for the Indian markets in line with the Asian markets. However, markets may turn volatile ahead of the inflation today and credit policy of the RBI soon this week.

Key events today

·      Announcement of monthly Inflation data for May

·      Listing of IPO of VMS Industries Ltd. (BSE code: 533427), issue price: `40 per share.

Economic and Corporate Developments

·      Farm credit flow surpassed the target by about 14% to `4,265bn during FY11. The govt. had set the target of farm credit disbursal at `3,750bn during the year.