RTTNews - The Indian market may open modestly higher on Tuesday following some intra-day recovery in Asian stocks this morning. Although short covering after about 7% loss since last Thursday may also help, a lack of positive triggers and worries on the monsoon front could lead to intermittent profit taking and volatility.
Net sales by foreign institutional investors (FIIs) totaled Rs 639.92 crore on Monday, while domestic institutional investors bought shares worth Rs.86.14 crore, provisional data released by the BSE showed. According to market regulator SEBI, FIIs sold shares worth Rs. 846.10 crore on a net basis last Friday.
The meteorological department said on Monday that there would be fairly widespread rainfall in many parts of India by Thursday. It remains to be seen if the announcement perks up sentiment.
A finance ministry release revealed that net direct tax collections rose a modest 3.27 percent during the first four months of the current financial year despite higher tax refunds. The growth in corporate taxes was 2.6% at Rs 42,685 crore against Rs 41,598 crore during the same period last year, while personal income tax, including STT, FBT and residual BCTT, grew 4.3%.
On Wall Street, stocks posted modest losses on Monday, as traders cashed in on recent gains ahead of some key economic reports on tap for this week, including data on retail sales, industrial production and weekly jobless claims. Further, the Federal Open Market Committee will make its interest rate announcement on Wednesday, with the key fed funds rate expected to remain unchanged amid a challenging economic environment. The Dow Jones Industrial Average eased 0.34%, the Nasdaq Composite slipped 0.4% and the S&P 500 index drifted down 0.33%.
The Indian ADRs closed mostly lower. ICICI Bank plunged 5.91%, MTNL plummeted 5.71%, Reddy's Laboratories tumbled 3.75%, HDFC Bank fell 3.01%, Sterlite Industries declined 2.25%, Infosys eased 1.03% and Satyam Computers shed 0.54%, but Wipro ended up 1.89%.
Crude oil prices touched as low as $70.09 before finishing lower at $70.60 a barrel, down 33 cents in New York trading on Monday, weighed down by losses on Wall Street and caution ahead of the Federal Reserve's interest rate decision later this week.
The rupee showed a modest gain on Monday, gaining 3.50 paise against the dollar. Earlier in the day, the currency hit a high of Rs.47.64 before it pared gains to finish at Rs.47.80/81.
Swine flue fears and concerns that a bad monsoon would disrupt a nascent revival in the domestic economy pulled down the Indian market sharply down on Monday despite strong Asian cues. The BSE Sensex finished at 15,010, down 150 points or 0.99% and the S&P CNX Nifty fell 44 points or 0.98% to 4,438. Sectors that may be hurt by weak rains like auto, FMCG, consumer goods, and cement stocks bore the brunt of the selling pressure followed by capital goods, realty, public sector and banking stocks, while IT stocks rose sharply after encouraging economic data underpinned hopes of a recovery in the world's largest economy.
Stocks to Watch
Export-dependent sectors such as textiles, leather, gems and jewelery could be in focus after commerce minister Anand Sharma said that the foreign trade policy to be announced later this month will contain more stimulus for strengthening exports.
State-run companies NMDC and MMTC could see some activity on reports the government would ask some cash-rich public sector companies to announce special dividends.
The promoters of Great Eastern Shipping are holding preliminary discussions with private equity firms to raise around Rs 700 crore by selling up to a 25% stake in a wholly owned subsidiary, reports suggest.
Sugar stocks may see some buying after London October white sugar LSUV9 rose more than 4 percent to $561.90 per tonne on Monday.
The Andhra Pradesh state government said that it will review the Rs 1,590-crore contract awarded to Maytas Infra-led consortium to construct a greenfield port at Machilipatnam as it failed to achieve financial closure by April 21, 2009.
Moser Baer has contested media reports that Supreme Court has issued it a notice asking it to show reason why it should not be asked to pay income tax of Rs 2978 crore. It is a sum of Rs 2.97 crore that the Income Tax Department had demanded as tax. This figure has been inflated a 1,000 times..., the company said in a statement.
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