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15 Apr 2012

Market Updates – 15 Apr 2012

Source:  NSE, BSE , PDICAI

Plunging stock market pushes day traders to the edge as day trading activity declines 50%turnover

Maharashtra : Prolonged weakness in the stock market has heightened concerns among day traders about their survival in the market. Over the past one year, the number of active day traders has fallen by 25-30% due to lack of intra-day trading opportunities on the bourses, according to some of the active traders. The day trading activity has declined by 50%, prompting otherwise street smart market participants to adopt a cautious strategy that includes increasing use of algorithmic trading and reducing headcount to save cost, said brokers. The day trading community, led by large players like Crosseas Capital Services and Total Securities, is struggling to cope with the adverse market conditions that caused a slump in volumes and put pressure on their margins.

Inflows into gold etfs at 5-yr high

Maharashtra : Net inflows into gold exchange-traded funds (ETFs) for the financial year 2012 were the highest in the last five financial years as muted returns in most other asset classes and an uncertain outlook for the world economy prompted risk-averse investors to flock to the yellow metal.Net inflows into gold ETFs for FY12 amounted to R3,646 crore, a 59% increase over the R2,289 crore garnered in the previous fiscal, data from industry body Amfi shows. The figure is 43 times more than the amount collected in FY09, the year the global financial crisis shook world markets. Assets under management (AUM) for the category in FY12 have more than doubled over that in the previous fiscal, and multiplied more than 20 times in the past five years.

Sensex up 133 pts on hopes of rate cut, firm global mkts

Maharashtra : The BSE benchmark Sensex gained 133 points today to close at 17,332.62 on widespread buying despite a dip in industrial growth on renewed investor hopes that RBI may cut lending rates next week at its annual monetary policy meeting. Besides, brokers said, investors did some value buying in bluechips at lower levels amid firm global markets.Metal, banking, FMCG, auto and capital goods attracted good buying. However, technology stocks saw selling on caution ahead of IT bellwether Infosys results tomorrow.

UK’s FTSE index to be traded on NSE from next month

Maharashtra : After equity indices of emerging markets, Indian investors will now be able to trade the key index of the UK. The National Stock Exchange (NSE) will launch trading in the FTSE 100, the UK’s benchmark equity gauge, from May 3.NSE already offers trading in the S&P 500 and Dow Jones Industrial Average, key benchmarks in the US. Both NSE and the Bombay Stock Exchange are offering a range of global indices to be traded in the rupee. BSE recently launched trading The FTSE 100 index accounts for over 80 per cent of the UK’s equity market capitalisation,

Commodities – Demand for natural rubber to rise 3.1%

Kerala : Global natural rubber (NR) demand is likely to increase this year, according to the initial trend in consumption. A high crude oil price may also positively impact demand world over, according to experts. This is so because an alternative for natural rubber, synthetic rubber (SR), is produced from crude oil derivatives and its prices take a cue from crude oil prices. This may also lead to a shift in the ratio of NR-SR consumption in favour of NR.In India, the demand is anticipated to rise 3.1 per cent year-on-year during Q1.

INTERNATIONAL BUSINESS – Carlsberg sells Copenhagen brewery site in $441million deal

Danish brewer Carlsberg (CARLb.CO) is to sell most of a former Copenhagen brewery site to a group of investors for 2.5 billion Danish crowns ($441 million), which will help reduce debt. The new owners will be a consortium of pension funds Realdania, PFA and Pensam as well as insurer Topdanmark (TOP.CO), the brewer said.Carlsberg, which will keep a 25 percent stake in the site, will book a pretax capital gain of about 1.7 billion Danish crowns in the second quarter from the sale.

MERGER & ACQUISITION – Trafigura to buy up to 24% stake in NOCL refinery for $130 mn

Oil trader Trafigura has made its first move into refining in Asia, investing up to $130 million for a 24% stake in Nagarjuna Oil Corp Ltd’s (NOCL) planned refinery in southern India and replacing BP as NOCL’s crude supplier. India and other emerging markets are boosting refining capacity to feed rising regional demand, while their counterparts in the United States and Europe restructure or shut plants as fuel sales slow.

Indian Overseas Bank eyes 16 to 18% credit growth in FY13

Maharashtra : Public sector lender Indian Overseas Bank (IOB) Wednesday said it is aiming a credit growth rate of 16-18% and a deposit growth rate of 18-20 per cent in the current financial year. “Currently, we aim 18-20% deposit growth and 16-18% credit growth in FY13,” IOB chairman and managing director M Narendra said. He added deposit growth for the bank stood at 18-19% for the last fiscal against 13-14% witnessed by the banking system.

Sensex, Nifty slide bank stocks gain on talk of cut in cash reserve ratio by Reserve Bank

Maharashtra : The BSE Sensex and Nifty fell on Wednesday, as a global flaring of risk aversion hit blue chips such as Reliance Industries, though broader losses were cut, as lenders gained on speculation the central bank could cut the cash reserve ratio (CRR). Fears about the potential impact in southern India from a powerful 8.6 magnitude earthquake off Indonesia also kept investors on edge, exacerbating falls in Reliance and hitting others such as Tata Power that could have been the most impacted.

Commodities – Gold may fall below $1,550 in coming months: GFMS

Maharashtra : Gold is likely to remain bearish in the short term due to lower expectations from the third round of quantitative easing (QE3) in the US and gradual abatement of the euro zone economic crisis. But, the yellow metal may recover and set a new record in the long term. The latest survey, released on Wednesday by Thomson Reuters GFMS, the global precious metals consultancy, forecast gold prices to fall below $1,550 an ounce in a month or two.

Commodity futures trading rises 52% in FY12

Commodity futures trading in India, the world’s biggest gold and sugar user, surged 52 per cent in value to a record last year, driven by bullion and farm goods. The value of commodities traded on bourses, including the Multi Commodity Exchange of India Ltd, advanced to Rs 181.3 lakh crore ($3.5 trillion) in the year ended March 31 from Rs 119.5 lakh crore a year earlier, the Forward Markets Commi-ssion, the industry regulator, said on its website on Wednesday. Bullion worth Rs 101.8 lakh crore was traded last year, 85 per cent more than a year earlier, as gold futures in India rallied to a record in December, data from the regulator showed.

NCDEX imposes 10% initial margin on four farm items

Delhi : National Commodity and Derivatives Exchange has slapped a 10% minimum initial margin on chickpea, soyabean, rapeseed and soyaoil futures, the exchange said. The margin, to be effective from Thursday, will be on top of the special and additional margins levied on these contracts, it added. The commodity market regulator, the Forward Markets Commission (FMC), cut the size of contracts a trading member can hold in chickpea and oilseed futures from Tuesday to curb excessive speculation amid expectations of a drop in output.

INTERNATIONAL BUSINESS – Spanish yield spike forces ECB to consider bond buys

The scale of market pressure on Spain is not justified given the reforms being undertaken by its government and the European Central Bank still has its bond-buying programme as an option, ECB executive board member Benoit Coeure said on Wednesday. Markets are watching closely for any signs that a rise in Spanish bond yields back above 6% may prompt a change in ECB rhetoric after policymakers in recent weeks stressed it was now up to governments to deal with the crisis, not the bank.

Carlyle eyes $7.5-8 billion market valuation in IPO

Carlyle Group LP is eyeing a market valuation of $7.5 billion to $8 billion in an initial public offering, as the US private equity firm prepares to kick off a marketing blitz to investors, perhaps next week, said a source with knowledge of the situation. Carlyle, which has $147 billion in assets under management, plans to sell a 10 percent stake to raise $750 million to $800 million in the IPO, the source told Reuters on Tuesday. The firm had said in a regulatory filing earlier this month that it might sell a 10% stake but its expectation on market value was not previously known.


Siddhesh Sardesai
IW Committee