Market commentary
equity
GLOBAL MARKET OVERVIEW
z The Dow Jones Industrial Average Index (DJIA)
rose despite ongoing credit concerns and weak
economic data. On the economic front, jobless
claims came in at 342,000 for the week, which
was below expectations of 375,000 claims. New
home sales totaled 526,000 during March 2008,
declining 8.5% month-over-month. Market
expected sales of 580,000 units for the month.
On the other hand, durable goods orders for
March 2008 slipped 0.3%, but climbed 1.5%
excluding transportation.
z Gold prices traded around $905 an ounce
tracking global markets.
CRUDE OIL
z Oil prices rose to $120 per barrel due to supply
related concerns and a weak dollar. Additionally
prices rose as a labour strike closed a North Sea
pipeline, due to rising geopolitical tensions
between the United States and Iran and unrest
in Nigeria.
million in quarter ended March 2008.
Consolidated total revenues of the company grew
18.13% on Y-o-Y basis and a sequential rise of
2.95% during the quarter to Rs 60,980 million.
z Biocon profits rose 31.16% to Rs 620.30 million
from Rs 472.90 million in the same quarter, last
year. Net sales declined marginally 5.92% to Rs
2,197.50 million, while total income for the
quarter declined 1.09% to Rs 2,367.10 million,
when compared with the prior year period. The
company also announced a bonus issue.
OUTLOOK
z On one hand, near term trend in the market is
likely to be dictated by inflows from foreign
funds, international developments especially on
the sub-prime crisis front and commodity prices.
On the other hand, market focus in the coming
weeks will remain on the fourth quarter earnings
report season and domestic economic data (IIP
and inflation).
WEEKLY SNAPSHOT
DOMESTIC MARKET
z The markets rose influenced by upbeat corporate
results, good derivative rollovers and firm global
markets. Sensex and S&P CNX Nifty settled above
the key levels of 17,000 and 5,000 points.
“In investing,what is comfortable
is rarely profitable”
- Robert Arnott
z RCom buys UK WiMax operator eWave World.
z Reliance Retail ties up with Office Depot,
buys eOffice.
z Ranbaxy
picks
up
9.54%
stake
in
Orchid Chemicals.
z Era Infra bags contract from Lanco.
z SEBI permits mutual funds to launch Real Estate
Mutual Funds (REMFs).
z Tata Consultancy Services (TCS) registered a
Y-o-Y increase of 4.15% and a sequential decline
of 6.17% in consolidated net profit to Rs 12,450
APR 21 - APR 25, 2008
25/04/08
change
% change
Data as on April 17, 2008
Sensex
16,481.2
17,126.0
644.8
3.9
Nifty
4,958.4
5,111.7
153.3
3.1
CNX Midcap
6,836.4
7,056.2
219.8
3.2
Re/dollar
39.9
40.1
FII flows (Rs cr)*
49.6
579.60
0.2
NA
0.5
NA
Data as on April 18, 2008
DJIA
12,849.4
12,891.9
42.5
0.3
Nasdaq
2,403.0
2,422.9
20.0
0.8
FTSE 100
6,051.3
6,091.4
40.1
0.7
Hang Seng
24,197.8
25,516.8
1,319.0
5.5
Nikkei
13,476.5
13,863.5
387.0
2.9
CAC 40
4,961.7
4,978.2
16.5
0.3
DAX
6,843.1
6,896.6
53.5
0.8
5.0
4.3
Crude Oil
$115
$120
*cumulative
Source: www.sebi.gov.in, www.bseindia.com
Market commentary
debt
GLOBAL MARKET OVERVIEW
z US treasury prices fell as signs of the US
economy's resilience supported expectations that
the Federal Reserve may soon take a break from
cutting rates.
z Oil prices rose due to supply related concerns.
Prices also rose as a strike closed a British oil
pipeline and due to geopolitical tensions between
the United States and Iran.
DOMESTIC MARKET
z G-Sec yields remained steady with investors
uncertain whether the central bank would increase
the short-term repo lending rate in its monetary
policy review meeting on April 29, 2008. Call rates
traded in the range of 5.00%-8.00%.
z The rupee fell weighed down by dollar buying by
companies and banks.
APR 21 - APR 25, 2008
possible slower growth in the economy. Direct
taxes grew by 38% to Rs 3.09 trillion in the last
fiscal year, while indirect taxes were more than
Rs 2.79 trillion.
z Forex reserve rose by $1.167 billion to touch
$313.534 billion for the week.
OUTLOOK
z Liquidity will be an important factor taking
into consideration the demand for credit. The
central bank will auction 6.57% Government Stock,
2011 for Rs 3,000 crore under MSS on April 30,
2008. The market may face tight liquidity
following the first stage of the cash reserve ratio
(CRR) hike by the Reserve Bank of India (RBI)
coming into effect from April 26, 2008. The debt
market will be looking forward to RBI’s Monetary
policy meeting on April 29, 2008 and US Federal
Reserve meeting on April 29-30, 2008.
Surplus cash may prompt RBI to
hike key rate
YIELD MOVEMENTS
-The Economic Times, April 25, 2008.
Apr 21, 2008
Apr 25, 2008
8.19
8.28
8.06
YIELD %
z The 364-day and 91-day Treasury bill auction on
April 23, 2008 saw a cut-off of 7.69% and
7.44% respectively.
z Inflation rose to 7.33% for the week from 7.14% in
the previous week due to increase in prices of food
and primary products. The wholesale price-based
annual inflation rate stood at 6.34% in the
corresponding week last year.
z The central bank wants to ease credit flow to
agriculture sector. In order to balance growth with
inflation, the Reserve Bank of India (RBI) is likely to
tighten the margin or collateralised requirement
for credit or working capital loans to industrial
houses while relaxing credit flow to the
farm sector. (Source:- Business Standard)
z India's tax receipts crossed Rs 5.88 trillion during
2007-08, and senior officials are confident of
attaining this year's target despite duty cuts and a
7.86
8.18
7.84
7.62
7.77
7.40
10 yrs
G-Sec
Source: www.debtonnet.com
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