RTTNews - The Indian market is likely to open on a subdued note on Tuesday amid mixed Asian cues and due to profit taking following over 13% gains in the last 5 trading sessions.
However, with FIIs resuming their purchases and corporate earnings exceeding market expectations, the market is likely to witness stock-specific buying on alternate bouts of buying and profit taking. After some consolidation at current levels, analysts expect the market to cross the recent highs that it touched before the announcement of the Union Budget on June 6.
The major U. S. averages kicked off the week on a positive note overnight, boosted by promising earnings results and reassuring news from commercial lending giant CIT Group. While quarterly results from Halliburton Co, M&T Bank Corp, Hasbro, Eaton, and Johnson Controls largely exceeded Wall Street expectations, bolstering trader optimism, a report from the Conference Board showed that its index of leading economic indicators increased by more than expected in June, although both the coincident index and lagging index continued to decline. The Dow Jones Industrial Average moved up 1.19%, the Nasdaq Composite rose 1.2% and the S&P 500 index advanced 1.14%.
The Indian ADRs also closed mostly higher. ICICI Bank surged up 9.19%, HDFC Bank jumped 6.61%, Satyam climbed 5.69%, Infosys soared 5.01%, Wipro rallied 4.44% and Reddy's Laboratories and Sterlite advanced over 2% each, but MTNL ended down 1.03%.
After rising above $64 a barrel, crude oil futures finished at $63.98, up 42 cents from Friday's close on Monday amid strong corporate earnings, a weak dollar and news of a rescue package for troubled U.S. Lender CIT Group. In Asian trading on Tuesday, the commodity was last trading largely unchanged at $63.96 a barrel ahead of the release of a weekly inventory report from the U.S. Energy Administration Department due on Wednesday.
The rupee climbed to close at a two-week high of 48.20/21 against the dollar on Monday, up 52 paise from the previous close, boosted by the weakness of the dollar in overseas markets and hopes of improved capital inflows on the back of a sustained rally in the domestic market,
On Monday, the Indian market rallied further on the back of strong global cues, positive earnings surprises and strong institutional buying. The BSE Sensex made a gap-up opening at 14,854 and rose sharply to 15,209 before finishing at 15,191, up 446 points or 3.03% from its previous close. Likewise, the S&P CNX Nifty rose 127 points or 2.91% to 4,502, while the small-cap and the mid-cap indexes on the BSE advanced over 2.5% each. On the BSE, gainers outnumbered losers by 1837 to 832, with 72 stocks closing unchanged.
Stocks to Watch
The proposed merger between BSNL and MTNL has been put on hold for the time being, as the enabling conditions for the suggested options are not appropriate, minister of state for communications and IT Gurudas Kamat told the Lok Sabha on Monday.
UTV Software Communications has proposed to consolidate the business of its subsidiaries UMP Plc and UTV Motion Pictures (Mauritius) into the company to reap the benefits of operational synergy and enhance shareholders value.
Punj Lloyd plans to raise about $125-150 million through the QIP route to cut its high-cost debt and infuse liquidity, reports suggest.
State-run lender SBI said on Monday that its provisions on bad loans were adequate, but hinted at raising the provisions if the need arises.
Tata Steel plans to raise about $400-600 million through a global depository receipts (GDR) offering to international investors, media said.
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