RTTNews - Thursday, the Indian market may open flat with a positive bias on the back of mixed global cues and short covering after a sell-off in the previous session. Concerns about stretched valuations and a further correction in the absence of FII support may keep underlying sentiment cautious. Traders look forward to the inflation report scheduled to be released around noon on Thursday.
While FIIs pulled out a net Rs.363.99 crore from Indian equities on Wednesday, domestic financial institutions turned net buyers with an investment of Rs. 569.10 crore, provisional data released by the Bombay Stock Exchange showed. On Tuesday, FIIs sold shares worth Rs.711.80 crore, according to market regulator SEBI.
The major U.S. averages saw a lackluster outing on Wednesday, with the averages finishing on opposite sides of the unchanged line amid mixed sentiment with regard to the near-term prospects of the economy and the proposed financial system reforms from the Obama administration. The data on consumer prices showed a modest increase in the month of May, but the rise was less than what the economists had expected. Unable to hold on to their earlier gains, the Dow Jones Industrial Average slipped 0.09% and the S&P 500 index dropped 0.14%, but the Nasdaq Composite index ended up 0.66%.
The Indian ADRs closed mixed. Satyam plunged 8.16%, HDFC Bank declined 2.51%, Sterlite fell 2.74%, ICICI Bank edged down 0.57% and Wipro slipped 0.09%, but Infosys rose 1.06%, MTNL gained 1.82% and Reddy's Laboratories added 3.59%.
Oil prices finished a choppy session modestly higher on Wednesday in U.S. trading, as investors mulled the Energy Information Administration inventories report. The dollar weakness and a statement from Qatar's top energy official that OPEC is unlikely to agree to increase output any time soon also offered some support. After finishing at $71.03 a barrel, up 56 cents in New York trading on Wednesday, crude oil is now trading at $71.15 a barrel, up 0.17% in Asian trading.
After moving in a range of Rs.48.16-47.81, the rupee ended sharply lower at Rs.48.13/14 against the dollar, down 39 paise on Wednesday on fears about portfolio capital outflows in line with a sharp slide in the domestic stock market.
Meanwhile, a lack of buying support amid weak global cues and extensive profit taking dragged the Indian market sharply down on Wednesday. Weakness in the European markets for the fourth straight day significantly dented investor sentiment. The BSE Sensex closed near the day's lows at 14,523, down 435 points or 2.91% from its previous close and the S&P CNX Nifty fell 162 points or 3.58% to 4,356. Second-line stocks underperformed large-caps and decliners outnumbered advancers by by 1990 to 686. Realty and metal stocks bore the brunt of the selling pressure followed by public sector, oil/gas and capital good stocks.
Stocks to Watch
Infosys is reported to have received a $10 million three-year BPO deal from Microsoft for back-end support. Separately, TCS and Wipro, among others, are in discussions with Citigroup for buying its technology assets valued between $60-100 million, reports suggest.
According to reports, Reliance Communications is in exclusive talks with French telecom infrastructure provider Alcatel-Lucent to award a $500 million or Rs.2,500 crore operations and maintenance contract.
Tata Communications may rope in a strategic partner to bolster its capabilities in the emerging wireless technology, another report said.
Carriers Jet Airways and Kingfisher on Wednesday announced a hike in their fuel surcharge by Rs. 400/ticket on all domestic sectors.
Zandu Pharmaceutical Works proposed to consider and approve a scheme of arrangement for restructuring and reorganizing the business of the company with its holding company Emami.
Fortis Healthcare reportedly leads the race to acquire a part of Wockhardt Hospitals after Apollo Hospitals Group shelved its plans to buy a basket of hospitals'' from Wockhardt due to differences in
Wockhardt sold its German subsidiary Esparma to another German company Lindopharm GmbH for an undisclosed sum.
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