Qualcomm, a maker of chips and other gear used in mobile phones

International News:

Qualcomm, a maker of chips and other gear used in mobile phones, warned late Wednesday that a more mild outlook for the economy this year has caused it to cut back expectations. In his State of the Union Address Wednesday night, the president said that boosting employment is his administration's "No. 1 focus in 2010" and that he was calling for a new jobs bill. He said the administration will work on beefing up hiring in the short term and creating sustainable jobs that grow wages in the longer term. Economy: The number of Americans filing new claims for unemployment fell to 470,000 last week, down from a revised 478,000 the previous week. Economists surveyed by Briefing.com thought claims would fall to 450,000. A report showed that December durable goods orders, a measure of manufacturing, rose 0.3% after falling 0.4% in the previous month. Economists expected orders to rise 2%. Federal Reserve Chairman Ben Bernanke was confirmed for a second term Thursday by the U.S. Senate. The final confirmation vote was 70-30. Minutes earlier, more than enough senators, 77, voted to end a filibuster on the nomination in a procedural move that required 60 votes. Microsoft Corp. said Thursday its earnings in the most recent quarter jumped 60 percent, as a rebound in the personal computer industry drove sales of the company's latest Windows operating system. But results in Microsoft's other divisions show that while consumers have resumed spending on new PCs, big corporations have not. After declining for three consecutive weeks food price inflation hit 17.4 percent for the week ended January 16, 2010. The Indian mobile service providers added a record 19.1 million users in December 2009, higher than 17.6 million added in November 2009. The CCI approved the proposal to develop a fourth container terminal at JNPT at an estimated cost of Rs.6,696 cr. The Finance Minister may target an inflation of 4 per cent, by the end of 2010-11. Havells India has acquired Standard Electricals for around Rs.120 cr. Aptech acquires Maya Academy for Rs.76 cr. Srei-led consortium, which has emerged as the highest bidder for the 57.17 per cent stake in DPSC, paid Rs.172 cr to Andrew Yule, LIC and United India Insurance, who have offloaded their stakes in the company. HPCL plans to invest Rs.25,000 cr to set up a refinery with an annual capacity of 15 million tonnes a year. BHEL signed a JV deal with Madhya Pradesh Power Generation Company Ltd for setting up a1,600 Mw supercritical thermal power plant in Khandwa district. Bartronics bags projects from 5 SBI associates.

Derivative news:

Nifty near contracts ends the expiry day up by 23.9 and adds OI by 22.9% (In active contracts). at a premium of 4.80 points compared to the discount of 4.95 points last day. Nifty near contracts ended the expiry down by 342.95 points over the close of Dec Expiry. Nifty OI PCR in active options at 1.143 compared to 1.203 at the close of the Dec expiry. Nifty VIX at 28.92 from 25.82 last day. Highest OI in Nifty put at 4800 Feb strike and calls is at 5200 Feb strike. Nifty rolls over 76.53% of the positions compared to 69.91% in last expiry. Highest rolls in no of contracts rolled over in the past 11 months. Market wide rollover seen at 82.6% compared to 87.09% in the previous expiry. IBREALEST, TATACHEM, SINTEX, SYNDIBANK, BEML, NATIONALUM, UCOBANK, BOSCHLTD, PUNJLLOYD, ASIANPAINT, CROMPGREAV, GTLINFRA, FINANTECH, IOB, HINDPETRO, SIEMENS & OFSS etc sees more than 40% rise in rollover compared to the previous expiry.

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Marico Ltd.- Concall Takeaways

Net sales increased 7.8 per cent to Rs.669.56 cr in Q3FY’10 compared to Rs.621.01 cr in Q3FY’09, while PAT after minority interest increased by 22 per cent to Rs.62.19 cr in Q3FY’10 compared to Rs.50.89 cr in Q3FY’09

Parachute

Marico’s flagship brand, Parachute, achieved a volume growth of about 8% over Q3 FY09 in rigid packs. During the quarter, the prices of copra (dried coconut kernel) the raw material input for Parachute coconut oil were about 22% lower than in Q3 FY09. Even though there was some increase in December ’09, the rates for the month remained lower than in December ’08 by about 14%. As the company had begun observing a slow down in the conversion from loose oil into the “recruiter packs”, it reduced the retail price of Parachute’s 50 ml pack from Rs 12 to Rs 10 in November ’09. In addition it has initiated a reduction in the price of its 100 ml pack from Rs 21 to Rs 20 in January ‘10.

Saffola

The refined edible oils franchise of Saffola continued to show a healthy volume growth
During Q3FY10 the franchise grew by about 18%. This growth was aided by a consumer offer of 20% extra on selected SKUs of Saffola Gold and Saffola Active.

International FMCG Business

Marico’s international FMCG business has been steadily growing and comprises about 23% of the group’s turnover. Its key geographies are Bangladesh, MENA (Middle East and North Africa) and South Africa. In Q3FY10 the business grew by about 24% over Q3FY09.

Kaya Skin Clinic

During Q3FY10, Kaya’s skin care turnover grew by 10% over Q3FY09. At Rs.44 crore however, this was a decline of about 9% over the turnover achieved during Q2FY10. Given the discretionary nature of consumer spending at Kaya, the business has been impacted by the overall economic slowdown. The price increase taken by Kaya consequent to the imposition of service tax from September 1, 2009 has also acted as a dampener to growth. For clinics that have been in existence for over 12 months, the overall same clinic revenue in India has declined by 13%. While the clinics in Dubai have got impacted by the financial crises, the business in the Middle East as a whole has performed well with the other Emirates and KSA making up for the slow down in Dubai. Same clinic revenue growth is the Middle East was 16% over the corresponding quarter in the previous year. The Kaya Skin business incurred a loss of Rs 3.7 crores during Q3FY10.

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The Federal Reserve restated its intention to cease buying $1.25 trillion of mortgage-backed securities in March

International News:

The Federal Reserve restated its intention to cease buying $1.25 trillion of mortgage-backed securities in March and maintained its pledge to keep interest rates near zero for an “extended period,” opening a rift among policy makers for the first time in a year. New home sales plunged to a 9-month low, according to a Census Bureau report released Wednesday. Sales fell 7.6% to a seasonally adjusted annual rate of 342,000 in December from a revised rate of 370,000 in November. China’s banking regulator told lenders to step up scrutiny of property loans while pledging to satisfy “reasonable” financing needs as it seeks to control credit growth and prevent asset bubbles.

Domestic News

Bank of Baroda, Union Bank, IDBI Bank plan to tap the overseas debt market to mop up $1.5-2 billion in the next month or so. A high level panel, headed by the Finance Secretary, has cleared four port expansion projects entailing an estimated investment of Rs.4120.29 cr in three states. Fitch ratings’ outlook for the real estate sector in 2010 is negative with a slightly stable bias. Air India may get Rs.1,200 cr equity support from the government. The government has deceided to allow companies executing Ultra Mega Power Projects to use surplus coal from their captive blocks to fuel their other power projects. Air India may get Rs.1,200 cr equity support from the government. The government is considering selling its stakes in L&T and ITC in tranches to state run FII’s. Air India may get Rs.1,200 cr equity support from the government.

Corporate news:

Easun Reyrolle will invest Rs.100 cr to set up a facility to manufacture solid insulated switchgear. ONGC Videsh has signed a MOU with the national oil company of Angola, Sonangol. Tata Communications plans to invest about $50 million over the next two years into the newly formed Global Media and Entertainment Solutions group. Edelweiss has agreed to aquire the retail broking firm Anagram Capital for Rs.164 cr, in an all-cash deal.

Derivative news:

Nifty near contracts ends the day down by 153.9 and adds OI by 18.2% at a discount of 4.95 points compared to the discount of 5.85 points last day. Nifty OI PCR in active options at 0.904 compared to 1.019 last day. Nifty VIX at 28.92 from 25.82 last day. 14.68 Lakh Nifty puts was added over the day and Nifty calls added 17.13 Lakh during the day. Highest OI in Nifty put at 5000 Jan strike and calls is at 5300 Jan strike. Short build up seen over the day in TECHM, IBREALEST, TATASTEEL, BAJAJ-AUTO, AXISBANK, CNXIT, HCLTECH, BHUSANSTL, NTPC, GTLINFRA, HDFCBANK, SAIL, MCDOWELL-N, LICHSGFIN, NAGARCONST, MARUTI, JPASSOCIAT, KFA, JSWSTEEL & TATACHEM etc.
FII side saw short build up in Nifty futures, short covering in stock futures.
Nifty rolls over 59.75% of the positions compared to 58.10% in last expiry and six month average of 60.98. Highest rolls in no of contracts rolled over in the past six months. Market wide rolls at 58.40% compared to 66.65% in Dec expiry and 6 month average of 60.9% Stocks with significant rise in rollover are CONCOR, BOSCHLTD, SYNDIBANK, TECHM, TATACHEM, IBREALEST, PUNJLLOYD, UCOBANK, YESBANK, ASIANPAINT, MINIFTY, NATIONALUM, GTLINFRA, SINTEX, IOB, HINDPETRO, NIFTY, BEML, NTPC & TATASTEEL etc.

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US stocks tumbled Thursday after the Obama administration announced a proposal to increase regulation of the nation's biggest financial firms

International News:

US stocks tumbled Thursday after the Obama administration announced a proposal to increase regulation of the nation's biggest financial firms, including limiting the size and scope of their trading operations. Japanese stocks plunged as part of a global rout after a U.S. government proposal to ban banks from investing in hedge funds triggered declines in U.S. shares, the dollar and commodities. Google Inc. reeled in more Internet advertising during the holiday shopping season and approached $2 billion in quarterly profit for the first time, providing the strongest sign yet that Internet search leader has shaken off the recession's doldrums. Goldman Sachs said it earned $8.20 a share in the fourth quarter, trouncing forecasts for a profit of $5.20 per share, thanks to strong gains in its investment unit. The number of Americans filing new claims for unemployment rose to 482,000 from 446,000 in the prior week. Economists surveyed by Briefing.com thought claims would fall to 440,000.
Food inflation softened to 16.81 per cent for the week ended January 19,2010. Steel demand would be back within three years to the peak levels seen before the global financial crisis started in 2008, as per L N Mittal. Pronab Sen, Chief Statistician of India sees lower GDP growth in Q3 to 6-6.5%. Essel group and Bhushan Steel are set to acquire a 250-acre plot in Kharghar for Rs.1530 crore. JSW Energy plans to invest Rs.4500 crore to acquire coal mines abroad and another Rs.10,000 crore in West Bengal.
Powergrid proposes to invest Rs.50,000 crore for developing seven transmission corridors in the next five years. Varun Industries plans to set up Rs.230 crore steel unit inJodhpur. TAFE plans to roll out 1.2lac tractors in 2010-11.

Derivative news:

Nifty near contracts ends the day down by 130.20 points  adding OI by 10.60% at a discount of 9.60 points with indications of short build up in Nifty futures. Nifty OI PCR in active options stood at 1.176 compared to 1.293 in the last session. Nifty VIX at 23.50 from 22.29 last session. 15.89 Lakh Nifty puts was added over the day and Nifty calls added 62.88 Lakh during the day. Short build up seen over the day  in PIRHEALTH, DRREDDY, LT, PUNJLLOYD, LITL, IDFC, CAIRN, INDIACEM, HDFC, BIOCON, DIVISLAB, STER, HINDZINC, IVRCLINFRA, WELGUJ, IBREALEST, INDIAINFO, EKC, ORCHIDCHEM, HINDPETRO, CROMPGREAV, NOIDATOLL, ISPATIND, TV-18, ULTRACEMCO etc. FII side sees short build up in Nifty & Stock futures and Nifty options  was seen to be bought.

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China’s growth rate accelerated to the fastest pace since 2007

International News:

China’s growth rate accelerated to the fastest pace since 2007 in the fourth quarter, signaling a need to rein in credit growth that threatens to destabilize the world’s fastest growing major economy. Gross domestic product rose 10.7 percent from the same period a year ago, more than the median forecast of 10.5 percent in a Bloomberg News survey, a statistics bureau report showed in Beijing today. For the full year, GDP gained 8.7 percent, beating Premier Wen Jiabao’s 8 percent target. Dow component Bank of America said losses widened to $5.2 billion in the fourth quarter of last year, partly due to the bank paying back government bailout funds. BofA said the repayments shaved $4 billion off its bottom line. The company was expected to post a loss of $3.9 billion, according to forecasts. On a per-share basis, BofA lost 60 cents versus forecasts for a loss of 52 cents. Shares were barely changed. Morgan Stanley its second-straight quarterly profit, one year after posting a massive loss. The financial firm said it earned $617 million for the quarter versus a loss of $11 billion a year ago. The stock fell around 1.7%. Wells Fargo reported a surprise profit of $2.82 billion, or 8 cents a share, versus forecasts for a small loss. The bank benefited from stronger fee income, even as it repaid $25 billion in bailout money. Shares fell 1.6%. Building permits, a measure of builder confidence, rose to a 653,000 unit annual rate in December from a 589,000 rate in November, the government reported. Permits were expected to rise to a 590,000 rate, according to a consensus of economists surveyed by Briefing.com. But housing starts fell to a 557,000 unit annual rate from a 580,000 unit rate in November. Economists thought starts would fall to a 572,000 unit rate. The Producer Price Index (PPI), a measure of wholesale inflation, rose 0.2% in December after climbing 1.8% in the previous month. Economists thought it would hold steady. The so-called core PPI, which strips out volatile food and energy prices, was flat versus forecasts for a gain of 0.1%. Core PPI rose 0.5% in the prior month.

Domestic News:

The government is keen to bring metals and mining companies at the front of the divestment queue. An estimated Rs.53000 crore of IPOs/FPOs are expected to hit the markets. Auto Industry may be heading for excess capacity by 2012. LIC, largest shareholder in L&T has opposed the company’s intention to enter the insurance business. Mercator Lines, India’s second largest shipping company, has bagged over Rs.1000 crore, seven-year contract for chartering a mobile offshore production unit and a floating storage tank. HDIL has raised Rs.425 crore as debt, in addition to Rs.400 crore raised last month. Lupin has received clearance from the US drug regulator for its plant at Mandideep in Madhya Pradesh. Hyundai Motors is expected to increase the prices of its car models from February 1, 2010. Whirlpool is targeting to treble its AC business by the year-end. Future Group’s home retailing has seen a turnaround after months of decline, on the back of improved consumer sentiments and focused merchandising plans.

Derivative news:

Nifty near contracts ends the day down by 5.95 points adding OI by 1.4% at a discount of 6.95 points. Nifty OI PCR in active options stood at 1.293 compared to 1.285 in the last session. Nifty VIX at 22.29 from 22.35 last session. 19.9 Lakh Nifty puts was added over the day and Nifty calls added 12.69 Lakh during the day.
Highest OI in Nifty put at 5200 Jan strike and calls is at 5300 Jan strike. Long build up over the day seen in SUNTV, BANKBARODA, ABB, BHUSANSTL, TATASTEEL & ICSA etc.
Short build up seen over the day in POLARIS, PIRHEALTH, HINDPETRO, PUNJLLOYD, PETRONET, UNITECH, HINDZINC, JPASSOCIAT, BEML & MTNL etc. FII side sees long liquidation in Nifty and short covering and long build up in stock futures and Nifty options was seen to be bought.

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Financial firm Citigroup reported a $7.6 billion quarterly loss,

international News:

Financial firm Citigroup reported a $7.6 billion quarterly loss, partly due to the bank paying back the government $20 billion in bailout funds. On a per-share basis, Citigroup lost 33 cents, in line with forecasts, after reporting a loss of $2.44 a share in the prior year's quarter. The British candy company agreed to a larger $19.5 billion takeover offer from U.S. food maker Kraft Foods in a deal that puts an end to a four-month fight. The board on Tuesday recommended shareholders take Kraft's cash-and-stock offer in a move that will create the world's biggest chocolate maker. IBM posted a fourth-quarter profit Tuesday that beat Wall Street expectations. The tech giant also pointed to an improved outlook for 2010. The Armonk, N.Y.-based company reported a profit of $4.81 billion, or $3.59 per share, which was 9% higher than what IBM reported last year. Analysts polled by Thompson Reuters expected $3.47 per share. Sales rose a modest 1% to $27.2 billion, slightly ahead of forecasts. Sales in the company's services sector and software sector each increased 2%, while revenue in its hardware business fell 4%. IBM expects to improve its revenue. performance in 2010. The euro tumbled to the lowest level in more than four months against the dollar on concern Greece’s deteriorating fiscal situation will weigh on the region’s economic recovery. The 16-nation currency also approached a four-week low against the yen on speculation European Central Bank Executive Board member Juergen Stark will reiterate his bearish outlook for the region’s economy and the budget deficit in Greece when he speaks today.

Domestic News:

The Securities & Exchange Board of India (SEBI) allowed exchanges to introduce currency futures in three more currencies- euro, yen and pound. The Government has announced a cash subsidy of Rs.12000 crore for oil market companies. The government has no immediate plan to raise prices of petrol and diesel. Indian Railways may raise freight rates for bulk items. Siemens has bagged an order worth Rs.2956 crore from QatarGeneral Electricity and Water Corporation. BHEL is eyeing acquisitions, JVs in the US and Europe. Standard Chartered Group is set to buy out the remaining 25.1 per cent stake of Securities Trading Corporation of India in Standard Chartered- STCI Capital Markets. Vivendi SA is planning to buy 51% stake in Datacom Solutions, owned by the Videocon Group. Italy’s PRYSMIAN has agreed to buy a 51% stake in Pune-based Ravin Cables for Rs.200 crore. Teva Pharma has filed a patent suit in the US against Lupin Pharma. This prevents the Indian company from selling generic version of Teva’s birth control drug for 30 months.( Impact: -ve for Lupin Laboratories) Usha Martin is planning to raise close to Rs.500 crore through the QIP route. NTPC’s FPO may be priced at Rs.245-250. The company plans to set up a separate arm for acquiring coal assets abroad.

Derivative news:

Nifty near contracts ends the day down by 50.45 points adding OI by 1.5% at a discount of 4.95 points. Nifty OI PCR in active options stood at 1.285 compared to 1.339 in the last session. Nifty VIX at 22.35 from 21.55 last session. 4.06 Lakh Nifty puts was added over the day and Nifty calls added 22.47 Lakh during the day.
Highest OI in Nifty put at 5200 Jan strike and calls is at 5300 Jan strike. Long build up over the day seen in YESBANK, TITAN, NAGARFERT, IOB, CHAMBLFERT, ANDHRABANK, CHENNPETRO etc. Short build up seen over the day in BAJAJHIND, IVRCLINFRA, HCC, PTC, RENUKA, DRREDDY, SUZLON, ACC, TV-, 8, JPPOWER, GAIL, HINDALCO , INDIACEM etc. FII side sees long liquidation in in Nifty and short build up in stock futures and Nifty options was seen to be bought.

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Jain Irrigation Systems Limited (JISL) is a leading agri-business multinational organization based in Jalgaon, Maharashtra.

Jain Irrigation Systems Limited (JISL) is a leading agri-business multinational organization based in Jalgaon, Maharashtra. JISL manufactures a wide range of products, which include irrigation systems, piping systems, plastic sheets, bio-fertilizers, solar water heating systems and photovoltaic appliances. JISL is also present in the food processing industry. JISL has 10 plants in India and 13 plants strategically located abroad. JISL has a 55 percent market share of the domestic micro irrigation market through its extensive dealer network of 1,500. outlets. Globally JISL commands a 20 percent market share of the MI segment
Dominant player in micro-irrigation (MI): JISL has a 55 per cent market share of the domestic micro irrigation market through its extensive dealer network of 1,500 outlets. Globally, JISL commands a 20 per cent market share of the MI segment. Out of 70 mha (million hectares) under irrigation in India, it is estimated that only 2 mha is under micro-irrigation. A Government appointed task force has proposed to bring 14 mha under micro-irrigation during the Eleventh five year plan (2007-2012), at an estimated cost of Rs.2.1 lac cr and a subsidy plan under which 50 per cent of the equipment cost would be funded by the government and the balance by the farmer. Over the years, most of the states have increased the subsidy to 70-75 per cent. Government’s focus, coupled with increased subsidy, will drive the growth for MI and SI segment, on a medium to longer term horizon. Taking into consideration all these factors, the MI/SI segments provides strong visibility for growth. Piping business to benefit from infrastructure investments: A large part of the piping industry is unorganized, being small and medium scale in nature. However, there are few major players in the organized sector and JISL is one of these players, with a 15 per cent market share in PVC pipe segment and 35 per cent market share in the PE pipe segment. JISL has a pipe manufacturing facility of 1,15,000 MT, making it the largest pipe manufacture, by capacity. The company manufactures a wide variety of pipes ranging from diameter 0.5” to 22” pipes. These pipes are used in water and gas distribution, sewage networks, telecommunication and construction, among others.
Government investment in water distribution systems, sewage systems, urban infrastructure and gas distribution systems will continue to drive momentum in the piping segment.Government investment in water distribution systems, sewage systems, urban infrastructure and gas distribution systems will continue to drive momentum in the piping segment. Currently, only few cities are covered under the city gas distribution and the volatility in oil prices have prompted expansion of the city gas distribution network across cities. This expansion is likely to result in a significant demand for pipes over the next few years. Some of JISL’s esteemed clients in this segment include Gujarat Gas Company and Indraprastha Gas Ltd (IGL), among others. Finance Budget expected in February, 2010: The Finance Budget 2010 expected in the last week of February, 2010 could highlight some of the subsidies and benefits that the government intends to give to the agricultural sector. In the Finance Budget 2009, the food and fertilizer subsidy was over Rs.1,200 billion. In addition, the government, in order to build the required infrastructure to bring more land under irrigation, has allocated Rs.1,00,000 capex for every hectare of land. Some positive announcements are expected with respect to the agricultural sector, by the government, in the forthcoming Budget, which in turn could be positive for companies like JISL. Financials and Valuations: At the present market price of Rs.836, the stock is trading at 28.38x its FY’10E earnings and 20.95x its FY’11E earnings. For H1FY’10 the net sales stood at Rs.1116.74 cr compared to Rs.933.85 cr for H1FY’09, an increase of 19.6%. PAT for H1FY’10 was Rs.98.17 cr compared to Rs.54.06 cr for H1FY’09. On the back of government’s thrust on irrigation and infrastructure development, revenues are expected to grow at more than 15 percent Y-o-Y for the next two years atleast, on a conservative basis. JISL has evolved from being a pure irrigation player, to a water solution provider, food processor and a building material provider through both, organic and inorganic routes and in the last couple of years the company has made quite a few acquisitions. Taking into consideration that the Finance Budget 2010, to be announced in the last week of February 2010, is expected to have some positive announcements for the agricultural sector, we recommend a “BUY” with a price target of Rs.965 over the next six months.

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The head of the IMF said China and other developing Asian economies are leading a global recovery

International News:

The head of the IMF said China and other developing Asian economies are leading a global recovery that is faster and stronger than expected, but warned that money rushing into emerging markets could lead to asset bubbles. Dominique Strauss-Kahn, the managing director of the International Monetary Fund, strongly suggested Monday that the IMF would raise its 2010 global growth forecast from the 3.1 percent it projected in October. Kraft Foods Inc. is close to an agreement to buy Cadbury Plc after raising its offer 9 percent to about 12 billion pounds ($19.7 billion) to overcome months of resistance by the U.K. chocolate maker, three people with knowledge of the matter said. Asian stocks fluctuated as Australian banks and Japanese exporters of cars and electronics fell, while commodity producers rose on oil and metal prices. Japan Airlines is expected to file for bankruptcy protection Tuesday, ending months-long speculation about its fate and launching a massive overhaul to shed the fat and inefficiency that hobbled Asia's biggest airline. With debts of 1.5 trillion yen ($16.5 billion) as of November, the carrier will go down in Japanese corporate history as one of its biggest failures. The Government expects to mop up Rs.24000 crore in this fiscal with four more public issues of state-owned companies hitting the capital markets in the next two-and-a-half months. Standard & Poor’s has said that India will regain and sustain its pre-crisis GDP growth rates of about 9% starting 2011, provided it hastens policy reforms in areas that include taxation, education and foreign investment regulations. The government may take the first step towards fiscal budget consolidation in Budget 2010-2011 by partially rolling back tax cuts given to the industry last year.

Corporate news:

Carrefour, Europe’s biggest retail chain, is close to signing a deal with Pantaloon Retail to set up franchisee stores in India. Reliance Capital is looking to sell up to 20% stake in Reliance Mutual Fund to a strategic foreign partner. GAIL will pick up 4% in Myanmar – China Project. Golden Tobacoo received shareholder’s approval at an extra-ordinary general meeting to develop property at Vile Parle in Mumbai. L&T will invest around Rs.25000 croreto build its thermal power business in the next five years. Oberoi Realty has filed a draft application with the market regulator to sell 12% of its equity. The company plans to raise Rs.1000 crore through the IPO route. ICICI Bank has raised rates for deposits of select maturities. Reliance Infratel plans to raise Rs.2500 crore from a pre-IPO placement.

Derivative news:

Nifty near contracts ends the day up by 16.75 points adding OI by 1.1% at a marginal discount of 3.70 points. Nifty OI PCR in active options stood at 1.339 compared to 1.290 in the last session. Nifty VIX at 21.55 from 21.34 last session.
28.69 Lakh Nifty puts was added over the day and Nifty calls added 4.57 Lakh during the day. Highest OI in Nifty put at 5200 Jan strike and calls is at 5300 Jan strike.
Long build up over the day seen in UCOBANK, TRIVENI, COLPAL, ALBK, HEROHONDA, MRPL, FEDERALBNK, KOTAKBANK, VIJAYABANK, INDIAINFO, ZEEL & HDFCBANK etc. Short build up seen over the day in ULTRACEMCO, BALRAMCHIN, BAJAJHIND, LITL & KFA etc. FII side sees short build up in Nifty and stock futures and Nifty options was bought.

Outlook and Analysis:

Nifty 5200 and 5300 puts saw addition during the day and Nifty 5200 and 5300 Jan calls saw paring of OI with indications of bias turning positive. For the day resistances seen in Nifty near contracts around 5350 levels. Supports seen around 5220 levels.

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ZEE Entertainment Enterprises Limited- Concall highlights

Advertising revenues for Q3FY’10 were Rs.2,707 million, an increase of 1% as compared to the corresponding period last fiscal, while subscription revenues were Rs.2,467 million for Q3FY’10, an 8% increase as compared to the corresponding period last fiscal. Subscription revenues from domestic DTH were Rs 632 million during Q3FY’10, an increase of 124% over Q3FY’09. PAT increased 74 per cent to Rs.1464.3 million in Q3FY’10 compared to Rs.839.7 million in Q3FY’09. The Board of Directors of the Company has approved the proposal to acquire additional 45% stake in its subsidiary Taj TV Limited Mauritius (Taj) and additional 50% stake in its subsidiary Taj Television (India) Pvt. Ltd. (Taj India) from Bukhatir Group (Bukhatir) for $44.145 million. Zee had acquired the initial 50% stake in Ten Sports in FY’07 at an enterprise value of $114 million. (assumed a debt of $28 million). The flagship Hindi General Entertainment Channel (GEC), Zee TV delivered 250 weekly GRPs on an average during Q3FY’10 and attained a channel share of 20% in its genre. Cash as on December, 2009 stood at Rs.1519 million.

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Japan Airlines Corp.

Domestic News:

Japan Airlines Corp. is preparing for what may be the country’s sixth-largest bankruptcy as Prime Minister Yukio Hatoyama breaks with predecessors who bailed out the carrier three times in the past nine years. Already the biggest auto market and steel maker, China edged past Germany in 2009 to become the top exporter, yet another sign of its rapid rise and the spread of economic power from West to East. Total 2009 exports were more than $1.2 trillion. That was ahead of the 816 billion euros ($1.17 trillion) forecast for Germany by its foreign trade organization, BGA.
The first bank to fail in 2010 is Horizon Bank, based in Bellingham, Washington. State regulators seized the bank's 18 branches on Friday. But Horizon customers are protected. The Federal Deposit Insurance Corporation, which has insured bank deposits since the Great Depression, currently covers accounts up to $250,000. India’s steel consumption rose close to 8% during April-December 2009, compared to the same period last year. Rating agency, CARE has suggested that the government may begin withdrawal of the stimulus packages in phases from early 2010-2011. The country’s fastest growing education sector can attract USD 100 billion investment over the next five years. The finance ministry will soon appoint consultants to guide Canara Bank, Bank of Baroda, Bank of India through bank consolidation. Customs duty collection for the month of December 2009 stood at Rs.7399 crore, almost the same as in December 2008. Banks are cautiously increasing their focus on the retail segment after a period of going slow on this business.

Corporate news:

Natco Pharma is expected to launch cancer drug Albupax after the health ministry stayed an order issued by the DGCI which had stopped the Indian company from selling its drug. M&M group said that it would enter the motor-cycle segment this year with the launch of an in-house developed bike. Setco automotive is planning to invest Rs.100 crore over the next two years for setting up a plant for clutch units in Africa and for market development.

Technical news:

The first week of the year ends up by 34.45 points at a premium of 4.70 points adding OI by 12.3%. Nifty OI PCR in active options stood at 1.235 compared to 1.203 last week. Nifty VIX at 23.34 from 22.69 compared to the closing day in the previous expiry. 1.435 Crore Nifty puts was added over the week and Nifty calls added 1.084 Crore during the week. Highest OI in Nifty put at 5000 Jan strike and calls is at 5300 Jan strike. Long build up over the week seen in BOSCHLTD, CUMMINSIND, SCI, SIEMENS, NATIONALUM, FINANTECH,. MLL, CESC, HDIL, TATATEA, TITAN, TULIP, MRPL, ESSAROIL, JPASSOCIAT, MOSERBAER, EKC, PIRHEALTH, INDIAINFO, FEDERALBNK, CAIRN, ABAN, HCC, MTNL, TATACOMM, SUNPHARMA, STERLINBIO, TATAPOWER & UNITECH etc.
Short build up seen over the week in CROMPGREAV, HCLTECH, TCS, MARUTI, LITL, BPCL, BAJAJ-AUTO, SAIL, INDHOTEL, MPHASIS, DISHTV & TATAMOTORS etc. FII side saw short covering and long build up in Nifty futures short build up stock futures over the week. Nifty options was seen to be bought over the week.

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China’s exports probably ended a 13- month slide in December

International News:

China’s exports probably ended a 13- month slide in December, aiding an economic rebound that has so far depended on government stimulus measures and a credit-fueled building boom. US December sales rose 2.8 percent compared with a year ago, according to the ICSC sales index; sales for the year fell 2 percent from all of 2008. For November and December combined, the index rose 1.8 percent, better than the group's estimate for a 1 percent gain. Last year, holiday sales fell 5.8 percent, the biggest sales decline for the key period in at least four decades. The number of Americans filing new claims for unemployment rose to 434,000 last week from 433,000 the previous week, the Labor Department reported Thursday. Economists surveyed by Briefing.com thought it would rise to 439,000, on average. Continuing claims, a measure of Americans who have been receiving benefits for a week or more, fell to 4,802,000 from 4,981,000 the previous week. Economists thought it would ease to 4,975,000.

Domestic News:

Food Inflation for the week ended December 26, 2009 stood at 18.22% compared to 19.83% for the previous week. The rupee hit a 15-month high against the dollar to breach Rs.46 levels. The rupee closed at Rs.45.70. The government will allow companies to adjust fringe benefit tax (FBT) paid by them against the advance tax due in the March quarter. The government may introduce legislation in the Budget session to make necessary constitutional amendments and facilitate the launch of GST. The merger talks between BSNL and MTNL have resumed. The two PSUs discussed the issue with the Prime Minister on Wednesday. Karnataka Government has offered two sites to Arcellor Mittal group for setting up its Rs.30,000 crore plant. Future Group is in the process of launching telecom services. The business model would be based on MVNO platform. The announcement is expected over the next six to eight weeks. Reliance Media Works acquired the assets of ilab UK Ltd. Strides Arcolabs is looking to supply drugs for niche therapeutics areas with global drug pharma companies. The merger between Catholic Syrian Bank and Federal Bank may not take effect due to differences over valuation. SAIL may cut prices of some of its products in the near future. Suryachakra Power Corporation is in talks with private equity players to raise funds for its Rs.2000 crore Phase I expansion plans. BGR Energy has tied up with a US-based company for heat recovery systems. The company shall invest close to Rs.40 crore in this new facility. Future Group has shelved its plans to set up standalone stores for retailing of electrical and lighting products to conserve cash. PSL Ltd. is augmenting its manufacturing capacity by 20 per cent to meet the demand from the oil and gas and water treatment sectors.

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Payroll services firm ADP said employers in the private sector cut 84,000 jobs

Domestic News:

Payroll services firm ADP said employers in the private sector cut 84,000 jobs from their payrolls last month, the smallest monthly decline since March 2008. However, economists surveyed by Briefing.com were expecting 75,000 cuts, on average. Employers cut 145,000 jobs in November. The Institute for Supply Management's services sector index rose to 50.1 from 48.7 in the previous month. Economists thought it would rise to 50.5, on average. A reading over 50 indicates expansion in the sector. When the Senate returns on Jan. 19, jolting the economy will be high on the to-do list. The Senate plans to take a crack at a $154 billion jobs creation package that eked out of the House in December by a vote of 217-212. The rupee hit a 15-month high against the dollar to breach Rs.46 levels. The rupee closed at Rs.45.85. The Government is planning to introduce a package of incentives for select export sectors, including engineering, handicrafts, textiles, pharmaceuticals and leather. Japanese companies, JFE Steel and Sumitomo Metal Industries are in talks with JSW Group & Bhushan Steel for acquiring stakes in new projects. GST roll out by April 2010 will not be possible as per Bhartiya Janata Party.

Corporate news:

RIL is looking to generate more funds by selling its treasury stock to institutional investors. L&T has bagged orders worth Rs.2325 crore from four states, Gujarat, Maharashtra, West Bengal and Chandigarh. ABG Shipyard has picked up 15% stake in Great Offshore forRs.280 crore. ICICI Bank has slashed home loan rates by 1% to 10.5%. Ranbaxy has started discussions to acquire a privately held Bangalore-based company. The deal is valued at Rs.50 crore. Ruchi Soya Industries has acquired over 50% stake inAndhra Pradesh-based Gemini Edible and Fat for Rs.50 crore. Lafarge is set to begin its next phase of organic as well as inorganic growth here. Mahindra & Mahindra group is committed to set up car plant in Tamil Nadu.

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Asian stocks rose, lifting the MSCI Asia Pacific Index to the highest level in 16 months

International News:

Asian stocks rose, lifting the MSCI Asia Pacific Index to the highest level in 16 months, after U.S. manufacturing expanded at the fastest pace in more than three years and commodities gained. The Institute for Supply Management's manufacturing index rose to 55.9 in December from 53.6 in November, signifying a wider expansion in the sector. Economists surveyed by Briefing.com thought it would rise to 54.3.
The Federal Reserve chairman said Sunday that the central bank's decision to keep interest rates very low between 2002 and 2006 was appropriate and not the cause of the housing market bubble. He said regulation would have been a better way to avert the collapse that ensued when home prices crumbled, leading to massive foreclosures, billions in losses for banks and the worst financial crisis since the Great Depression. Oil continued to rally for an eighth straight session and closed at the highest level in more than fourteen months as a pricing dispute and disruption in crude exports between Russia and Belarus worried investors. Oil for February delivery rose $2.15, or 3%, to close at $81.51 a barrel, the highest settlement since Oct. 9, 2008. Foreign fund inflows tripled in Q2FY’10. Fund inflows stood at USD23.6 billion in September 2009 quarter. The manufacturing sector in December climbed to its highest level since May 2009, signaling a faster monthly improvement in the key economic activity, as per an HSBC survey. Crude oil imports rose 6.1% to 10.47 million tonnes in November as domestic fuel demand surged, according to the data available from the petroleum ministry. India’s mineral production in value terms grew by 8.25% in October 2009.

Corporate news:

RIL has raised Rs.2675 crore by selling treasury shares. RIL has proposed to invest nearly Rs.7000 crore in bringing to production four gas discoveries adjoining its prolific gas fields in the KG basin. L&T has bagged Rs.987 crore order from GNFC.
Sadbhav Engineering has bagged an order worth Rs.490 crore from NHAI. Marico has bought Colgate-Palmolive’s haircare brand Code 10 for an undisclosed sum. Novartis has offered to buy Alcan, the world’s largest eye-care company from Nestle and minority shareholders for about USD39.3 billion. Titan is planning to triple its topline from Rs.4600 crore to Rs.14000 crore over the next five years. JSW Energy plans to invest Rs.40000 crore n developing power projects of 8000MW. IOC is in talks to buy 50,000 hectares of wasteland in Uttar Pradesh for plantation of non-edible oil seeds used for biodiesel production. Bosch is planning to invest a sum of Rs.2000 crore in India. Bharat Forge is planning to invest a sum of Rs.1500 crore in non-auto business. Zydus Cadila has got nod for swine flu vaccine.

Derivative news:

Jan Nifty ends the day up by 24.8 points at a premium of 7.60 points adding OI By 4.9%. Nifty OI PCR in active options at 1.214 compared to 1.203 last day on back of addition of 37.25 Lakh puts and 28.12 Lakh Nifty calls. Nifty VIX at 23.64 from 23.34 previous day. Highest OI in Nifty put at 5000 Jan strike and calls is at 5300 Dec strike. Long build up see in CHAMBLFERT, NEYVELILIG, FINANTECH, ASHOKLEY, EDUCOMP, IFCI, ABAN, KFA, MLL, CENTURYTEX, INDHOTEL, NAGARFERT, JPASSOCIAT, NATIONALUM, RELCAPITAL, ISPATIND, MTNL, ULTRACEMCO, ACC & M&M.

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Asian stocks rose after Chinese manufacturing expanded in December

International News:

Asian stocks rose after Chinese manufacturing expanded in December and a stronger dollar boosted the earnings outlook for Japanese car and electronics manufacturers.
Kraft Foods Inc. will probably extend its 10.5 billion-pound ($16.9 billion) hostile bid for Cadbury Plc, analysts said, as the U.K. chocolate maker’s shares trade above the offer on expectations of a higher price. Japan Airlines Corp., Asia’s biggest carrier, had a record jump in Tokyo trading after state-run Development Bank of Japan doubled a credit line, easing bankruptcy concerns. The airline climbed as much as 39 percent, the most in more than seven years. Three-wheeler majors like Bajaj Auto, Piaggio and Mahindra & Mahindra are ramping up capacity and launching new products. The country’s top steel makers saw up to a 50% sales jump in December 2009 compared to the corresponding period last year. Sugar prices are at record high levels of Rs.3700 a quintal, up 7-8 per cent from a month ago on the back of UP Government’s decision to ban import of raw sugar. Credit growth in the banking sector is seen picking up in Q4FY’10.

Corporate news:

Godrej Consumer Products is close to acquiring Indonesian household products company, Megasari in a deal estimated to be worth Rs.1200-1400 crore. The company has also placed a bid for the global pesticides business of Sara Lee Corp. Private Equity Bain Capital has bought a 15.4% stake in Kolkata-based Himadri Chemicals. This move is expected to help the company triple its capacity. Brazil’s Petrobas has decided to quit Oil and Natural Gas Commission’s gas discovery block in the Krishna – Godavari basin.

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Crude oil rose for a seventh day as colder weather in the U.S.

International News:

Crude oil rose for a seventh day as colder weather in the U.S. increased demand for heating fuels. Prices are poised for the biggest annual gain since 1999 on optimism consumption will rebound as the global economy recovers. Chinese central bank Governor Zhou Xiaochuan said that 2010 will be a crucial year for strengthening the recovery in the world’s third-biggest economy and “defeating” the financial crisis. Zhou’s New Year message, posted on the central bank’s Web site today, reiterated that a “moderately loose” monetary policy will continue. The Chicago PMI, a regional read on manufacturing, rose to 60 in December from 56.1 previously. The improvement was a surprise, with economists surveyed by Briefing.com expecting it to drop to 55.1. The US government gave GMAC Financial Services another $3.8 billion in cash and took a majority stake in the auto lender, aiming to stabilize the company as it struggles with big losses in its home mortgage unit. The U.S. will impose duties on $2.8 billion in steel-pipe imports from China after saying subsidies on the products may harm American steelmakers, a move that threatens to escalate trade tensions between the two countries.

Domestic News:

Bank credit growth is showing signs of recovery. Banking lending picked up nearly five-fold in December over the previous month. Non-food credit grew to Rs.31342 crore compared to Rs.5247 crore in the previous month. Indian export items like gems, jewellery, apparel and handicraft have seen an increase on account of the demand from the western countries on account of Christmas and New Year. India and China are expected to see strong growth in auto sales in CY’10. The timing for the withdrawal of stimulus packages has not come as per the Finance Minister, Mr. Pranab Mukherjee. Banks have rejected the RBI move to replace the benchmark prime lending rate with base rate. Life Insurance companies business grows 22% in April – November period. 3G Spectrum auctions are likely to take place on February 13. Export duty hike on iron ore is expected to push down iron ore despatches by 4.5%.

Corporate news:

The government is considering allowing NTPC to sell around 10% capacity at market-determined prices. This move is expected to boost the company’s profit by up to 40%.
The overseas arm of Cox and Kings has acquired two companies in Australia. TCS is stepping up hiring as spending by a number of companies have started increasing. The company is also planning to increase the capex. Aurobindo Pharma shareholders will consider amalgamation of Trident Life with itself on January 20, 2010. Godrej Consumer Products is aggressively looking at acquisitions. M&M will launch a one-tonne light commercial vehicle during the upcoming Auto Expo in Delhi.

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The U.S. economy grew at a 3.5% annual rate in the third quarter

International News:

The U.S. economy grew at a 3.5% annual rate in the third quarter, ending a string of declines over four quarters that resulted in the most severe slide since the Great Depression. Asian stocks advanced, paring the MSCI Asia Pacific Index’s first monthly decline since February, as Japan’s jobless rate unexpectedly dropped and the U.S. economy grew faster than economists expected. Japan's unemployment rate fell to a four-month low of 5.3 percent in September, beating the market expectation that it would rise to 5.6 percent, according to data from the internal affairs ministry. Banks trimmed their borrowing from the Federal Reserve's emergency lending program over the past week, evidence that some credit problems are easing as the economy recovers. Inflation grew by 1.51 per cent as of October 17 on the back of higher food prices. Duty-free white sugar imports into India could be upped by another one million tones (mt) to boost domestic availability and keep prices under check.
With trading hours at stock exchanges set to be extended by two-and-a- half hours, the half a dozen news channels together will get 20 per cent more advertising inventory to sell. A Special court will be set up in Hyderabad soon to try the Satyam Computer Services case. The government has approved a remunerative price of Rs.129.84 for a quintal of sugarcane during the 2009-10 season, beginning this month. It also approved a bonus of Rs.50 per quintal for paddy farmers during 2009-10 marketing season. The economic recovery will be faster in Asia than the rest of the world and is projected to grow by 5.75 per cent during 2010, says IMF.

Corporate news:

Aurobindo Pharma Limited, a Hyderabad-based manufacturer of generic pharmaceuticals and active pharmaceutical ingredients (APIs), has received approval from the Medicines Control Council (MMC) to manufacture and market two more products in South Africa. The Supreme Court while hearing the gas dispute of the Ambani brothers, said that the basis for fixing the government determined natural gas price of $4.20 per unit required examination. Godrej Properties Ltd, which has geared up for a maiden public offer, is considering to sell about four per cent stake in the company to private parties before the issue. The company, which has already filed draft papers with SEBI for its proposed IPO, is mulling a pre-placement of up to 24.44 lakh shares with certain investors. DBS Group, South East Asia’s largest bank, is set to kick off its retail banking operations in India. Tata Tea quits beverage retailing, to focus on branded products. BSNL to open bids today for Rs.900 cr IT project for the north zone. CESC is scouting for acquiring coal mines in Indonesia and South Africa. Stainless steel prices are likely to remain stable in the coming months, according to stainless steel producer JSL Ltd. A massive fire broke out at IOC’s fuel depot in Jaipur.

Derivative View:

Nifty: (4750): The index opened on a negative and declined throughout the day’s trading session. It ended the day with loss of 75 points. The index continues its decline post its close below the 10 and 20 dma level. Index is trading around the critical support level of 4700, pullback can be expected from around the 4700 level. Lower support is around 4648. On the upside index faces resistance around 4833-4860.
Nifty Nov contract ends the Day down by 51.70 points at a premium of 24.30 points in Nov contracts paring OI by 7.8% across all active Nifty contracts. Nifty Open Int PCR at 1.277 compared to 1.245 on the first day of the previous expiry. Nifty VIX at 28.22 from 28.48 the previous Day. Highest OI in Nifty put at 4800 Nov strike and calls is at 5000 Nov strike. Market wide rolls seen at 83.76% compared to 3 month average of 79.20% and 6 month average of 77.86%. Nifty rollover seen at 76.22% compared to the 3 month average of 71.83. Nifty sees 9% higher rollover (46294 contracts)compared to the previous expiry.

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US GDP is expected to have grown at a 3.2% annualized rate in the third quarter

Domestic News:

US GDP is expected to have grown at a 3.2% annualized rate in the third quarter after shrinking at an 0.7% annualized rate in the second quarter. US new home sales fell to a 402,000 unit annualized rate in September from a revised 417,000 unit annualized rate in August, the Commerce Department reported. US orders for manufactured goods meant to last three years or more rose 1% in September, after falling 2.6% in the previous month. Asian stocks dropped, extending a global decline, after the head of Australia & New Zealand Banking Group Ltd. said the Australian economy is “still fragile” and new-home sales unexpectedly fell in the U.S. China has told the U.S. that it will take steps that could lead to higher tariffs on imports of autos made by GM, Chrysler and Ford. The industrial output growth may see a drop in September 2009 from the 10.4% growth registered in August as the index of core sector industries, which has a weightage of 26.7% in the index, clocked a 4% growth in September 2009, sharply lower than 7.8% in the month before. Finance Minister, Mr. Pranab Mukherjee, has convened a meeting of financial advisors of various ministeries and departments today to take stock of the current situation and discuss measures for balancing growth with inflation by gradually withdrawing tax concessions and pump prime measures initiated to counter the slowdown. Successful bidders of 3G spectrum auctions will be allowed to treat their bid amount as expenses over a 20-year period, the tenure during which the 3G license is valid. The Employees Provident Fund Organisation will be seeking approval from its apex decision-making body, CBT, to implement a finance ministry order to invest up to 15 per cent of the funds in equity. The United States Telecommunications Sub-committee, an advocacy body which looks into telecom regulations around the world, has suggested a slew of reforms for India to implement in the communications sector. This includes increasing FDI limit from 74 per cent to 100 per cent, making the upcoming 3G auction rules more conducive for foreign players and allowing unrestricted Net telephony.

Corporate news:

Pfizer is going ahead with its plans to buy the biotech business of Wockhardt, but Mumbai-based drug maker has not shown any inclination for a sell out. RNRL alleged before the Supreme Court that the Ministry of Petroleum and Natural Gas was hand-in glove with RIL in the dispute over gas supply from the KG basin D6 block. Wills Lifestyle, part of the ITC, is planning to add 100 more stores over the next three years. Mahindra & Mahindra unveiled a brand new light commercial vehicle Gio, priced at Rs.1.65 lacs. SpiceJet may raise USD50 million by selling shares to fund expansion and start international flights. Intel, the world’s largest chipmaker, is understood to be in talks with leading Indian telecom companies like Tata Communications, Bharti Airtel and Reliance Communications that could bid for broadband wireless access spectrum to be auctioned by the government in January 2010. Airtel has launched a triple-play arcade puzzle game Getris on all three services of Airtel-mobile, internet and direct to home. This game would be available for DTH customers at Rs.25 for every two months and Rs.10 per month for Airtel mobile customers.

Technical View:

Nifty: (826): The index opened on a negative and saw choppy trades throughout the day’s trading session. It ended the day with loss of 20 points. The index encountered post its close below the 10 and 20 day averages is exhibiting weakness. On the downside index can test lower level around the recent breakout level of 4736 where support can be expected. On the intra day charts index is in oversold zone.Intra day support is around 4780 level. On the upside index faces resistance around 4872 and 4904,intra day bounce should face resistance around this level. Nifty Oct contract ends the Day down by 22 points at a premium of 0.40 points in Oct contracts adding OI by 2.1% across all active Nifty contracts. Nifty Open Int PCR at 1.060 compared to 1.095 yesterday on back of addition of 9.9 Lakh in Nifty puts and addition of 27.8 Lakh call options. Nifty VIX at 28.48 from 28.18 the previous Day. Highest OI in Nifty put at 4700 Oct strike and calls is at 5100 Oct strike. Market wide rolls seen at 61.69% compared to 3 month average of 59.99% and 6 month average of 57.16%.
Nifty rollover seen at 64.4% compared to the 3 month average of 59.9. Nifty sees 15% higher rollover (55208 contracts) compared to the previous expiry. Infrastructure, Textile, Telecom, Hotels, Sugar & Fertilisers saw more than 30% rise in rollover
Media, Technology, Cement, Capital Goods & Automobile saw a fall in rollover.

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Consumer sentiment took a plunge in October

Domestic News:

Consumer sentiment took a plunge in October, according to a Conference Board report released after the start of trading. Home prices rose for the fourth month in a row in August, according to the S&P Case-Shiller Home Price index of the 20 largest metropolitan areas. The largest U.S.-based steel maker said it lost $303 million, or $2.11 per share, for the three months ended Sept. 30. The Governor of Reserve Bank of India hiked Statutory Liquidity Ratio (SLR) by 1% to 25% from the earlier 24%. Other key rates were kept unchanged. The Finance Ministry will explore a partial year-end rollback of the excise duty cuts announced earlier. Government may cut sugar levy quota for the month of November by around 9%. The CBI has alleged that the grant of ‘Unified Access Service Licenses’ for 2G spectrum to some private companies caused a loss of over Rs.22000 crore to the government.

Corporate news:

Pantaloon Retail (India) Ltd. has finalized a plan to spin off its value retail business-discount store chains such as Big Bazaar and Food Bazaar-into a subsidiary in a bid to unlock value by offloading a stake in the groups’ largest business and grow it independently. The promoter of Vishal Retail, R C Agarwal, may have to forego the company he founded, as the debt-ridden company tries to bring in a strategic investor, a condition set by its bankers before they kick in a corporate debt restructuring plan. Binani Cement is in talks to acquire a cement firm in Turkey for around Rs.1000 crore as part of its strategy to more than double its production capacity over a two-year period. Shipping Corporation of India (SCI), the country’s largest shipping company, has outlined a USD4 billion capex to expand its fleet of vessels by 2012. Reliance Retail and Reliance Fresh, two subsidiaries of Reliance Industries in the retail sector, suffered losses as the company focused to expand its presence in various parts of the country. Hyundai Motor India has taken Mahindra Renault to the Delhi High Court, objecting to the latter’s plan to launch a compact car in the country with the name ‘Sandero’, alleging the rival was trying to cash on its popular Santro brand with a similar sounding name. Birla Corporation is looking at overseas opportunities for acquisition of cement facilities. After diversifying into hospitality sector with an investment of Rs.100 crore on converting a 20-acre orchard into a five-star resort-cum-spa in Anand, the Elecon group of engineering companies plans to invest another Rs.400 crore on its expansion and further diversification into developing recreational, sports and residential properties.

Technical View:

Nifty: (4864): The index opened on a negative and declined throughout the day’s trading session. It ended the day with loss of 124 points. The index encountered stiff resistance around the 10 and 20 dma level and is exhibiting near term weakness.
It has closed below the critical support level of 4900 suggesting near term negative bias. On the downside lower supports are around 4780-4736. Nifty Oct contract ends the Day down by 129.70 points at a premium of 1.85 points in Oct contracts adding OI by 15.2% across all active Nifty contracts. Nifty Open Int PCR at 1.095 compared to 1. 314 last Day on back of paring of 36.33 Lakh in Nifty puts and addition of 64.3 Lakh call options. Nifty VIX at 28.18 from 25.28 the previous Day. Highest OI in Nifty put at 4700 Oct strike and calls is at 5100 Oct strike. Market wide rolls seen at 44.56% compared to 3 month average of 40.79% and 6 month average of 38.39%. Nifty rollover seen at 50.16% compared to the 3 month average of 44.14. Nifty sees 36% higher rollover (86114 contracts) compared to the previous expiry. FII side sees short build up in Nifty futures, Long liquidation in stock futures and Nifty options was bought.

Views and Outlook:

Higher rolls were seen and significant short build up seen in Nifty. Nifty OI PCR is moving down and IV is seen rising and is indicating further downsides in the coming days. Highest OI in Nifty put options moves down to 4700 Oct strike with indications of support moving down to 4730 levels in the current expiry.

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Asian stocks declined, dragging the MSCI Asia Pacific Index down by the most in three weeks

International News:

Asian stocks declined, dragging the MSCI Asia Pacific Index down by the most in three weeks, as raw- material prices fell and Hong Kong enacted measures to curtail property speculation. U.S. stocks will “drop painfully from current levels,” in the coming year amid disappointing economic data and profits as margins shrink, according to investor Jeremy Grantham. Prime Minister’s Economic Advisory Council headed by Rangarajan said that the economy could grow between 6.25 per cent and 6.75 per cent, as against the 7-7.5 per cent projected in January. Power capacity addition has fallen short of its target by nearly a third in the first half (April- September) Mahindra group, the new owner of Satyam Computers and Tech Mahindra, is set to merge the two companies after June next year to transform the combined entity into an Indian information and communication technology powerhouse. Motherson Sumi bags Rs.1400 cr deal from two European auto firms for supply of rearview mirrors.

Technical View:

Nifty: (4965): The index opened on a flat note but was unable to hold onto the gains.
It ended the day with loss of 31 points. The index is encountering stiff resistance around the 20 dma level around 5038; intra day pullback is facing stiff resistance around the 20 dma levels. Higher resistance is around the 10 dma level around 5070.On the downside index has support around 4933 and 4900,lower support is around 4857,intra day declines should find support around the 4900 level. Nifty Oct contract ends the Day down by 26.95 points at a premium of 7.35 points in Oct contracts adding OI by 2.6% across all active Nifty contracts. Nifty Open Int PCR at 1.314 compared to 1.289 last Day on back of addition of 12.98 Lakh in Nifty puts and addition of 0.56 Lakh call options. Nifty VIX at 25.28 from 26.28 the previous Day.
Highest OI in Nifty put at 4900 Oct strike and calls is at 5100 Oct strike. Market wide rolls seen at 31.71% compared to 3 month average of 26.89% and 6 month average of 25.26%. Nifty rollover seen at 31.34% compared to the 6 month average of 32.22%.

Views and Outlook:

Nifty rollover is in line with the averages and long rolls is seen in Nifty. Further declines may be seen in line with the overseas cues at the open with supports seen at 4920 in Nifty near contracts.

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U.S. equities are about 40 percent above their fair value

Domestic News:

U.S. equities are about 40 percent above their fair value and headed for a decline as central banks pull back on quantitative easing that has pushed up asset prices, according to economist Andrew Smithers. Asian stocks gained after Toyota Industries Corp. reported unexpected profit and South Korea’s economy grew at the fastest pace in seven years, boosting the prospects for company earnings. Excise collections dropped 17 per cent in September to Rs.8, 180 cr from the same period the previous year despite the clear evidence of a pick-up in manufacturing.

Corporate news:

Air India is seeking an additional equity of Rs.5,000 cr from the government as it promises to squeeze its fleet size and reduce the wage bill of its 31,000 strong work force. R.Com said that it did not have to pay any additional license or spectrum fee to the government nor had it inflated its revenues. Petroleum Ministry is considering a proposal to allow GAIL to levy a marketing margin of about 6.16 cents for a mbtu on gas sold at government controlled price.

Derivative View:

Nifty: (4997): The index opened on a positive note but was unable to hold onto the gains. It ended the day with gain of 8 points. The index encountered stiff resistance around the 10 dma = 5067 and 20 dma = 5039, intraday rise saw stiff resistance around averages and it closed below the 10 and 20 dma level. Sustaining below the 10 and 20 dma should be considered negative in the near term. On the downside index has support around 4960, lower support is around 4920. Nifty Oct contract ends the Week down by 117.15 points at a premium of 10.85 points in Oct contracts adding OI by 0.4% across all active Nifty contracts. Nifty Open Int PCR at 1.289 compared to 1.500 last week on back of paring of 19.10 Lakh in Nifty puts and addition of 55.98 Lakh call options.
Nifty VIX at 24.49 from 26.28 the previous Week. Highest OI in Nifty put at 4900 Oct strike and calls is at 5100 Oct strike. Long build up was seen in POLARIS, BAJAJHIND, DABUR, YESBANK & HINDZINC over the week. Short build up was seen in CROMPGREAV, DIVISLAB, PUNJLLOYD, BHEL, GMRINFRA, GRASIM, BHARATFORG, PTC, IDEA, RELIANCE, SESAGOA, JPHYDRO, GTLINFRA, LITL, KSOILS, JSWSTEEL, RELINFRA, CHAMBLFERT, MRPL, PETRONET, ULTRACEMCO, TATASTEEL, HCC, ONGC, NAGARCONST, UNITECH, RELCAPITAL, DISHTV, CENTURYTEX & NAGARFERT over the week. Market wide rolls seen at 21.60% compared to 23.30% in last expiry and 3 month average of 21.20. Nifty rollover seen at 25.17% compared to 20.04% in last expiry and 3 month average of 25.72. Nifty rolls over % higher no of contracts compared to last expiry.

Views and Outlook:

Nifty OI PCR sees a falling trend as Nifty current month puts was paring OI during the week. Lower strike puts was also seen paring OI and significant paring was seen in 4800, 4900, 5100 and 5000 Oct strikes puts with indications of negative bias and support levels moving down. The expiry week is expected to open lower and rollover led volatility can rise during the week. Supports in Nifty near contracts seen at 4920 levels and resistances 5080 levels during the start of the week.

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Goldman posted a $3.2 billion quarterly profit

International News:

Goldman posted a $3.2 billion quarterly profit Thursday, crushing Wall Street estimates for the third straight quarter. New York-based Goldman made $5.25 a share, up from $1.81 a year ago and well above the $4.24 analysts surveyed by Thomson Financial were forecasting. International Business Machines posted third-quarter results on Thursday that met analysts' forecasts, then raised its expectations for the rest of the year, citing improving sales trends during the quarter. IBM said its net income for the quarter rose to $3.2 billion, up 14% compared to last year. Google said the worst of the recession has passed, as it reported quarterly profit and sales that rose from year-earlier results and easily trounced Wall Street's forecasts. Google's strong third quarter could be a good sign for the economy, as the company's ad clicks serve as a kind of barometer of consumers' willingness to spend. Citigroup, the lender 34% owned by the US government, posted a $101 million profit, defying expectations for a loss, as the company added the smallest amount to loan-loss reserves in two years.

Corporate news:

Inflation for the week ended October 3, 2009 stood at 0.92% against 0.70% for the previous week. The economy is unlikely to return to 9% growth level in the near future as the global slowdown may continue for some time, says Prime Minister’s Economic Advisory Council member, Govind Rao. Several Indian companies and financial institutions are planning to raise money from the overseas markets by issuing bonds.
Anil Ambani has alleged that there was a vicious and malafide campaign against his telecom company, Reliance Communications, by a known rival group. Sterlite Industries has announced a capital expenditure plan of Rs.2300 crore in a 400 kilo tonnes per annum brownfield copper smelter expansion project at Tuticorin in Tamil Nadu. SpiceJet plans to raise Rs.200 crore before the end of the current financial year. The instrument through which the funding would be done is yet to be decided. Rallis India will spend Rs.150 crore to build a factory at Dahej in Gujarat. Reliance Infrastructure has bagged a road construction project of around Rs.590 crore in Rajasthan. Polaris Software has announced that it has signed an agreement to acquire 100 per cent of Laser Soft Infosystems Limited.

Technical View:

Nifty: (5108): The index opened on a positive note and a saw profit taking at higher levels. It ended the day with loss of 9 points. The index is trading around the recent high of 5110,it has closed around the 5110 level. The index can see consolidation around the 5100 level. Index is trading above the 10 & 20 dma, near term bias should be considered positive, declines should find support around the averages. The 10 dma = 5041 and 20 dma = 4997.On the upside index faces resistance around 5167. Intra day support is around 5075 and resistance around 5152. Nifty Oct contract ends the Day marginally down by 4.90 points at a premium of 1.10 points in Oct contracts paring OI by 0.3% across all active Nifty contracts. Nifty Open Int PCR at 1.454 compared to 1.434 previous day. Nifty VIX at 26.64 marginally rising from 26.38 the previous Day. Ø Nifty put options add 17.69 Lakhs and call options add 6.38 Lakhs in OI during the day. Addition in Nifty put options seen in 4800, 5000 &4900 Oct strike during the day. Addition in Nifty call options seen in 5000 & 5100 Oct Strike during the day. Highest OI in Nifty put at 4900 Oct strike and calls is at 5300 Oct strike. FII side sees long liquidation in Nifty futures short build up in stock futures and Nifty options was bought.

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US housing starts rose to a 590,000 unit annual rate in September

Domestic News:

Yahoo Inc. raised its outlook for the rest of the year as it reported third-quarter earnings that blew past analysts' forecasts. US housing starts rose to a 590,000 unit annual rate in September, versus a revised 587,000 in the previous month. Economists expected starts at a 610,000 unit annual rate. US building permits, a measure of builder confidence, rose to a 573,000 unit annualized rate in September from a revised 580,000 unit annualized rate in August. The US Producer Price Index (PPI), a measure of wholesale inflation. PPI slipped 0.6% in September versus forecasts for a flat reading. PPI rose 1.7% in the previous month. The government is planning to give small investors a 5% discount when it sells shares in the three state-owned companies, REC, NTPC and Satluj Jal Vidyut Nigam. The government is considering a two-phase follow-on public offer FPO) of Steel Authority of India(SAIL). This move is expected to fetch the government a sum of Rs.8000 crore.
Tata Motors has bought the remaining stake of 79 per cent in Hispano Carocera SA, Spain’s largest bus and coach bodies manufacturer, for an undisclosed sum. Ess Dee Aluminium, which recently acquired India Foils, is close to making its first global acquisition in Europe. The deal is likely to be sealed within the next one or two months. Century Textiles and Industries plans to start commercial real estate development at its Worli mill land and will float a separate division to control it.
Pipavav Shipyard has signed a contract with ONGC for construction and supply of 12 offshore supply vessels at an aggregate value of about Rs.513.83 crore.

Derivative View:

Nifty Oct contract ends the Day down by 21.20 points at a discount of 10.00 points in Oct contracts paring OI by 2.0% across all active Nifty contracts. Nifty Open Int PCR at 1.381 compared to 1.500 previous day on back of paring of 14.77 Lakh in Nifty puts and addition of 26.38 Lakh call options. Nifty VIX at 26.69 from 26.28 the previous Day. Highest OI in Nifty put at 4900 Oct strike and calls is at 5300 Oct strike. Nifty puts pared position significantly in 5100, 5000 and 4900 Oct strike. No significant addition was seen in Nifty puts during the day. Nifty calls added the most in 5100, 5200 & 5300 Oct strike. Paring of positions was seen in 4900 & 5000 Oct strike. FII side saw long liquidation in Nifty futures and marginal long build up seen in stock futures and some marginal addition in Nifty options was seen. Long build up was seen in TRIVENI, BAJAJHIND, GVKPIL, RENUKA, BALRAMCHIN, YESBANK, SAIL, FEDERALBNK, HINDALCO, LICHSGFIN & APIL etc. Short build up was seen in PTC, SESAGOA, INDIAINFO, MRPL & M&M.

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Bank of America lost $1 billion in the third quarter

Domestic News:

After reporting big profits over the last six months, Bank of America lost $1 billion in the third quarter as growing numbers of consumer loans soured and the bank paid millions of dollars to wean itself off government life support. GE said its third-quarter net income fell 44% to $2.4 billion, or 23 cents per share, for the period ended Sept. 30. Results included a charge of $600 million, or 5 cents per share for restructuring and cost cutting. Apple said its fiscal fourth-quarter net income rose 47% to a record $1.7 billion, or $1.82 per share from a year earlier. Analysts polled by Thomson Reuters were looking for $1.42 per share. Asian stocks rose, driving the MSCI Asia Pacific Index to the highest level in more than a year, as earnings reports boosted confidence in the global recovery. The main barometer of inflation in India, WPI Index, will be published from November 14, 2009, providing a more accurate gauge of prices to policymakers in the government and the Reserve Bank of India. The Reserve Bank of India is unlikely to tighten liquidity in next week’s policy review despite the build-up of inflationary pressures and double-digit growth in the industrial output, according to most economists. Cement companies are expected to add 31 milllion tonnes capacity in second half of the year. FII are overweight on India, but valuations may be a concern later.

Corporate news:

RIL-RNRL dispute is scheduled for an afternoon hearing in the Supreme Court today.
RIL has been named among the top 25 global companies for 2009, which managed to outperform the competition in midst of meltdown in the financial markets. A cabinet committee approved the sale of 5% stake in NTPC. This sale is expected to fetch the government a sum of Rs.9000 crore. Tata-Quippo, the telecom tower venture between the Tatas and Kolkata-based Kanorias of Srei Group, is in advanced stages of negotiations with New York-based private equity fund Apollo Management to finance acquisition of cellular operator Aircel’s tower assets, should it win the bid. Uco Bank is likely to raise Rs.900-950 crore from follow-on public offer after a strong rally in the stock market. FCS Software has entered into a technical collaboration tie-up with Macnes, a UAE-based software company, to serve customers of its technology partner Microsoft, Oracle, IBM.

Technical View:

Nifty: (5142): The index opened on a positive note and a saw profit taking at higher levels. It ended the day with loss of 1 points. The index is trading above the recent high of 5110. Closing above the 5141 level should be considered positive in the near term. Near term bias is considered positive till index is sustaining above 5110 on a closing basis. Intra day declines should find support around the 5110 level. Lower support is around 5075.On the upside index faces resistance around 5200-5275 levels.
Nifty Oct contract ends the Week up by 191.15 points at a discount of 16.70 points in Oct contracts adding OI by 0.7% across all active Nifty contracts. Nifty Open Int PCR at 1.500 compared to 1.253 last week on back of addition of 89.77 lakh in Nifty puts and paring of 13.24 lakh call options. Nifty VIX at 26.28 from 30.25 the previous Week. Highest OI in Nifty put at 4900 Oct strike and calls is at 5300 Oct strike.
Long build up was seen in PTC, SBIN, UNIONBANK, BANKBARODA, NOIDATOLL, BHUSANSTL, SUNTV, BANKINDIA, BANKNIFTY, ESSAROIL, ORCHIDCHEM, UCOBANK, JPASSOCIAT, LITL, DENABANK, NAGARFERT, GVKPIL, ORIENTBANK, ALBK, CENTURYTEX, SESAGOA, SYNDIBANK, YESBANK, VIJAYABANK, CANBK & HDIL. Short build up was seen in BAJAJ-AUTO, CONCOR, RCOM, HINDPETRO, AMBUJACEM, KFA, INDIACEM, BHARTIARTL, BPCL, IOC & ULTRACEMCO.

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Merck net income jumped to $3.46 billion

International News:

Merck net income jumped to $3.46 billion, or $1.61 a share, from $1.12 billion, or 51 cents, a year earlier, Whitehouse Station, New Jersey-based Merck said. Asian stocks advanced as earnings reports from Australia to South Korea to Japan boosted speculation the global economy is exiting recession. Around 531,000 Americans filed new claims for unemployment last week, down from 520,000 the previous week. Economists surveyed by Briefing.com were expecting a bigger drop, to 515,000. The index of leading economic indicators (LEI) rose 1% in September after rising a revised 0.4% in the previous month. Economists thought it would rise 0.8%. The U.S. Federal Housing Finance Agency's housing price index fell 0.3% in September after rising 0.3% in August. Economists thought it would rise 0.3%. Inflation for the weekend October 10, 2009 stood at 1.21 per cent, the highest since May 23, 2009 when it was 1.34 per cent. From almost flat sales growth in 2008-09, ITC Ltd’s Lifestyle Retailing business division saw a low single digit growth during Q1FY’10. Den Networks, a cable television firm is entering the capital markets with an IPO of 2 cr shares. the price band for the issue has been fixed at Rs.195-205. ETHL Communications Holdings Ltd (ECHL), Essar Group’s holding company for telecom services, has raised Rs.4,280 cr through private placement of its zero coupon bonds.
Petronet LNG is all set to pick up a 10 per cent equity stake in ONGC Petro Additions Ltd. (Opal). Aditya Birla inks pact for Rs.1500 cr Orissa port.

Technical View:

Nifty: (4988): The index opened on a flat note and declined throughout the day’s trading session. It ended the day with loss of 75 points. The index exhibited weakness on break below the 20 dma level @ 5040. The index has closed below the 10 dma = 5067 and 20 dma = 5040,intra day pullback should face resistance around the averages. On the downside index has support around 4940-4930 band,intra day declines should find support around this level. Nifty Oct contract ends the Day down by 73.40 points at a premium of 8.80 points in Oct contracts paring OI marginally by 0.4% across all active Nifty contracts. Nifty Open Int PCR at 1.310 compared to 1.348 previous day on back of paring of 5.25 Lakh in Nifty puts and addition of 9.82 Lakh call options. Nifty VIX at 25.49 from 26.78 the previous Day. Highest OI in Nifty put at 4900 Oct strike and calls is at 5100 Oct strike. Addition was seen in 4800, 4900 & 4600 Nov strike puts, 5000 Oct, 5200 & 5300 Nov strike calls. Significant paring of position was seen in 4800, 5000 & 5100 Oct strike puts during the day.
FII side saw short build up in Nifty futures short build up in stock futures and Nifty options was bought. Long build up seen in ITC & Hindunilvr etc. Short build up seen in PIRHEALTH, LITL, HDIL, UNITECH, GTLINFRA, IOB, ORCHIDCHEM, DLF, DCHL, RANBAXY, TV-18 & RELMEDIA etc.

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China’s economy expanded at the fastest pace in a year

International News:

China’s economy expanded at the fastest pace in a year as stimulus spending and record lending growth helped the nation lead the world out of recession. Wells Fargo reported a profit of $3.2 billion in its latest quarter as strength in its mortgage-lending business and other units tempered the impact of losing billions in bad loans. Federal Reserve district banks identified commercial real estate as the weakest part of the economy, while most saw “stabilization or modest improvements” in areas including housing and manufacturing. Morgan Stanley’s third-quarter earnings were $757 million, or 38 cents a share, compared with $7.7 billion, or $6.97, a year earlier, the New York-based company said today in a statement. Walmart, the world’s largest retailer expects customers to delay holiday purchases, said John Fleming, chief merchandising officer.

Domestic News:

The Prime Minister’s Economic Advisory Council expects GDP to grow by around 6.5% in FY’10. The Centre has extended tax-free white sugar imports until December 2010.
The Finance Minister, Mr. Pranab Mukherjee, has categorically told Communications Minister, Mr. A Raja that 3G licenses cannot spill over to the next calendar year under any circumstances. The auction is expected to generate revenues of Rs.30,000 crore to the government. The strike by employees of auto component manufacturer Rico Auto and other auto ancillary companies have caused a production loss of around Rs.25 crore. The government is considering divesting 31% stake in Hindustan Copper, as per Mines Minister, Mr. B K Handique. Mahindra Satyam has bagged contracts aggregating UAE dirham 30 million(about Rs.38 crore) from the Middle East and North African region. RPG Cables is planning to bring in a new strategic investor a part of a plan to raise about Rs.200 crore to clean up debts and for erecting a new facility in Gujarat. Areva T&D India has been awarded a Rs.900 crore EPC contract by Mahashtra State Electricity Commission. Hedge fund Galleon is expected to liquidate its holdings. The fund has investments in Edelweiss Capital (7%), Shriram EPC(4.6%) and 0.3% in recently-listed Pipavav Shipyard.

Derivative View:

Nifty: (5063): The index opened on a flat note and declined throughout the day’s trading session. It ended the day with loss of 51 points. The index witnessed profit taking around 5150 level. Index has closed around the 10 dma level around 5067. Sustaning below the 5067 level can see it decline further towards the 20 dma level around 5040,lower support is around 5004.On the upside index faces resistance around 5095-5120 band. Nifty Oct contract ends the Day down by 33.65 points at a premium of 7.20 points in Oct contracts adding OI by 1.1% across all active Nifty contracts.
Nifty Open Int PCR at 1.348 compared to 1.381 previous day on back of addition of 3.91 Lakh in Nifty puts and addition of 14.06 Lakh call options. Nifty VIX at 26.78 from 26.69 the previous Day. Highest OI in Nifty put at 4900 Oct strike and calls is at 5100 Oct strike. Addition was seen in 5000 and 5100 strike Oct calls and 5000, 4900 & 5100 strike Oct puts saw paring of OI. FII side saw short build up in Nifty futures short build up in stock futures and Nifty options was written. Long build up seen in POLARIS, ROLTA, EKC & JINDALSTEL etc. Short build up seen in CROMPGREAV, PIRHEALTH, DIVISLAB, HCC, YESBANK, DABUR, TATAMOTORS, AUROPHARMA, SESAGOA & SYNDIBANK etc.









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Consumer sentiment took a plunge in October

International News:

Consumer sentiment took a plunge in October, according to a Conference Board report released after the start of trading.Home prices rose for the fourth month in a row in August, according to the S&P Case-Shiller Home Price index of the 20 largest metropolitan areas. The largest U.S.-based steel maker said it lost $303 million, or $2.11 per share, for the three months ended Sept. 30. The Governor of Reserve Bank of India hiked Statutory Liquidity Ratio (SLR) by 1% to 25% from the earlier 24%. Other key rates were kept unchanged. The Finance Ministry will explore a partial year-end rollback of the excise duty cuts announced earlier. Government may cut sugar levy quota for the month of November by around 9%. The CBI has alleged that the grant of ‘Unified Access Service Licenses’ for 2G spectrum to some private companies caused a loss of over Rs.22000 crore to the government. Hyundai Motor India has taken Mahindra Renault to the Delhi High Court, objecting to the latter’s plan to launch a compact car in the country with the name ‘Sandero’, alleging the rival was trying to cash on its popular Santro brand with a similar sounding name. Birla Corporation is looking at overseas opportunities for acquisition of cement facilities. After diversifying into hospitality sector with an investment of Rs.100 crore on converting a 20-acre orchard into a five-star resort-cum-spa in Anand, the Elecon group of engineering companies plans to invest another Rs.400 crore on its expansion and further diversification into developing recreational, sports and residential properties.

Technical View:

Nifty: (4864): The index opened on a negative and declined throughout the day’s trading session. It ended the day with loss of 124 points. The index encountered stiff resistance around the 10 and 20 dma level and is exhibiting near term weakness.
It has closed below the critical support level of 4900 suggesting near term negative bias. On the downside lower supports are around 4780-4736. Nifty Oct contract ends the Day down by 129.70 points at a premium of 1.85 points in Oct contracts adding OI by 15.2% across all active Nifty contracts. Nifty Open Int PCR at 1.095 compared to 1. 314 last Day on back of paring of 36.33 Lakh in Nifty puts and addition of 64.3 Lakh call options. Nifty VIX at 28.18 from 25.28 the previous Day. Highest OI in Nifty put at 4700 Oct strike and calls is at 5100 Oct strike. Market wide rolls seen at 44.56% compared to 3 month average of 40.79% and 6 month average of 38.39%. Nifty rollover seen at 50.16% compared to the 3 month average of 44.14. Nifty sees 36% higher rollover (86114 contracts) compared to the previous expiry. FII side sees short build up in Nifty futures, Long liquidation in stock futures and Nifty options was bought.

Views and Outlook:

Higher rolls were seen and significant short build up seen in Nifty. Nifty OI PCR is moving down and IV is seen rising and is indicating further downsides in the coming days. Highest OI in Nifty put options moves down to 4700 Oct strike with indications of support moving down to 4730 levels in the current expiry.

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