Business Standard

Pre-market: Flat start ahead; Dec trade data eyed

The SGX Nifty is currently quoting at 6,102.50 up 6 points indicating a lackluster start

SI Reporter Mumbai
Key benchmark indices are set for a weak start on subdued  global and emerging markets cues. The SGX Nifty is currently quoting at 6,102.50 up 6 points indicating a lackluster start a day after market participant’s rolled over from January series F&O contracts in the February series. The Nifty February month rollover stands at 72% vs the January month rollover at 68.22%. The market wide rollover was 81% vs 80.40% last month. The strongest rollover was seen in the infrastructure, telecom and realty sectors

Market participants will now wait fot the fiscal deficit numbers for December to be announced later in the day. CPI for industrial workers for December, by Labour Bureau is expected too. First revised estimate of GDP for 2012-13, by CSO is likely today.
 
"In the near term, expect a sharp technical bounce whereas resistance is expected around 6150 & 6200. Best trading strategy for traders would be buy the calls on dips with a stirct stoploss of 6020 as per closing basis," said Ravi Nathani, technical analyst at nsetoday.com. 

Foreign institutional investors (FIIs) sold shares worth a net Rs 430.20 crore on Thursday, according to provisional data.

Emerging market turmoil

A day after US Federal Reserve Chairman Ben S Bernanke announced another cut in the US' monthly bond-buying programme, Asian and emerging markets saw their stocks and currencies dropping on Thursday. Tracking a weakness in global financial markets, Indian markets also dipped, as investors were worried the Fed decision might lead to a curtailed flow of foreign equity in emerging markets, but the losses were limited and largely in line with other emerging markets.

This was in contrast with the period between May and September last year, when the rupee and Indian stocks fell sharper than their emerging market peers. At that time, India was considered one of the riskiest markets to invest in because of the country's high current account deficit and the inability of its government and central bank to control the currency's depreciation. The rupee had touched an all-time low of 68.85 on August 28.

The weak run for the Indian currency ended in early September, after Raghuram Rajan took charge as RBI governor and the government's curbs on gold imports started showing results. This time, fund managers said, the steps from the government and RBI, coupled with their repeated assurances to boost investor sentiment, augured well for the market.

Global markets

Wall Street rose on Thursday, buoyed by data showing the US economy grew as expected in the fourth quarter, following a recent sell-off triggered by concerns over emerging markets.

Despite the day's gain, the S&P 500 was still down more than 3 percent for the month. Investors have been concerned that recent bold efforts by central banks in emerging economies to stabilise their currencies may not be enough to staunch an exodus of funds from those markets.

The Dow Jones industrial average rose 67.75 points, or 0.43 per cent, to 15,806.54, the S&P 500 gained 12.8 points, or 0.72 per cent, to 1,787 and the Nasdaq Composite added 49.46 points, or 1.22 per cent, to 4,100.894.


Rollover stats:

January series started the month with Rs31,800 crore in the stock futures, Rs10,321 crore in the Nifty futures, Rs50,667 crore in the Index Option and Rs3,877 crore in the stock options.

The Nifty February month rollover stands at 72% vs the January month rollover at 68.22%.

The market wide rollover was 81% vs 80.40% last month.

The strongest rollover was seen in the infrastructure, telecom and realty sectors.

The media, fertilisers, cement and metals witnessed a poor rollover in the next series.


Other shares

Coal India will be in focus after the Ministry of Corporate Affairs on Thursday said that the Competition Commission of India (CCI) has ordered fresh investigation against Coal India (CIL).

Hero MotoCorp will be focus after the two-wheeler manufacturer reported a 7.53% rise in net profit to Rs 524.66 crore on 11.13% rise in total turnover (net sales and other operating income) to Rs 6876.78 crore in Q3 as compared to third quarter last year. Sales volume rose 6.85% to 16.80 lakh two-wheelers in Q3 December 2013 over Q3 December 2012.

Banking shares are likely to be focus today as RBI has offered some leeway to banks for early detection and resolution of bad loans. Under the new regime kicking off from April 1, lenders can finance 50 per cent of the outstanding loan value, RBI said in Framework for Revitalising Distressed Assets in the Economy, released on Thursday. Earlier, RBI had proposed to allow takeover of existing loans by new financiers at 60 per cent or more of the loan value.

State Bank of India, the country’s largest lender, on Thursday said it had raised Rs 8,032 crore by way of qualified institutional placement (QIP), which would boost its capital adequacy ratio to 12.81 per cent as compared to 12.09 per cent recorded as on September 30, 2013. The Tier-I capital of the bank will improve to 9.67 per cent, from 9.13 per cent, it added.

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Jan 31 2014 | 8:24 AM IST

Explore News