Sensex slides from intra-day high, but still ends 174 pts up

Sensex slides from intra-day high, but still ends 174 pts up
Nifty ends with modest gains as rally fizzles out

Equities ended off highs on Tuesday as profit booking set in at higher levels half way through the session. While buying was seen in IT and healthcare stocks, meltdown in commodities market weighed on metal stocks.

The Sensex and Nifty opened higher by 500 points and 150 points respectively, as other Asian markets welcomed the move by global economies to infuse liquidity in banks. Reserve Bank of India’s decision to infuse funds to the tune of Rs 20,000 crore through short-term lending route to help mutual funds meet their liquidity needs and overcome redemption pressure, further lifted sentiments. But the euphoria was short-lived as traders took it as opportunity to offload positions pulling indices to lower levels.

The BSE Sensex ended at 11,483.40, up 174.31 points or 1.54 per cent from its previous close. The index fell 400 points from the high of 11,870. NSE’s Nifty fell 130 points from its high of 3648.25 to close at 3,518.65, up 0.80 per cent or 27.95 points. The index touched a low of 3,491.50.

“Market opened with a gap-up but as selling emerged at higher levels the gap closed and the market ended on weak note. We are in a corrective rally and the bottom is not made yet. If 3,100 doesn’t hold, Nifty may fall to 2800-2850,” said, Bharat Dalal, fund manager, Dawnay Day AV Financial Services. BSE Midcap Index ended up 1.60 per cent and BSE Smallcap Index closed 2.25 per cent higher. BSE IT Index was up 5.36 per cent, BSE Healthcare Index moved 4.66 per cent higher and BSE Realty Index gained 1.84 per cent. BSE Metal Index ended 1.94 per cent lower.

Biggest Sensex gainers were Satyam Computer (7.38%), Infosys Technologies (5.87%), Jaiprakash Associates (5.2%), ICICI Bank (5.18%) and Reliance Infrastructure (5.09%). However, losses in Reliance Communications (-4.83%), Hindalco Industries (-4.11%), ONGC (-3.81%), HDFC Bank (-3.47%) and NTPC (2.7%) capped the upside. Market breadth on BSE showed 1,656 declines against 972 advances.

European markets continued with their up-run after several European governments came forward to inject funds in the banking system. FTSE 100 was up 5.69 per cent, CAC 40 advanced 5.09 per cent and DAX was up 5.33 per cent. US stock index futures are also pointing towards a gap-up opening on reports of plans to inject $250 billion into embattled banks. Dow Jones futures were up 0.4 per cent and Nasdaq 100 futures were up 1.2 percent.

Source:ET,Sify

If you had invested Rs 1 lakh on Jan 10, 2008...What would be the Value As on Oct 10 2008

If you had invested Rs 1 lakh on Jan 10, 2008...

A bout of negative news flows over the last few weeks has led to high volatility in the stock markets across the globe, including India. So much so that the Sensex has already fallen by more than 50 per cent from the all-time peak of 21206 on January 10 this year, and experts believe the markets might shed more weight in the near term owing to the current financial crisis, weak international cues and concerns of slowing down of world economy.

Last Friday also, the Sensex shed 800.17 points, after being down by close to 1,100 points at one stage, and ended at 10,527.85. In the current scenario, have you ever tried to find out the worth of your money if you had invested Rs 1 lakh in any of the following scrips on Jan 10, 2008?

Jaiprakash Associates
Closing on Jan 10: Rs 430.95
Closing on Oct 10: Rs 76.15
Change (%): (-) 82.33
Your Rs 1 lakh would now be worth: Rs 17,670

More Stk Comparison with details: If you had invested Rs 1 lakh on Jan 10, 2008...

Source:ET

Top Headlines Today

Top Headlines Today
Mkt recover on FM comments, positive global cues
Jet, Kingfisher join forces to tide over slump
Nano may roll out on Ratan Tatabs 71st bbday
No risk for ICICI UK arm: Moody's, S&P
Axis Bank Q2 net goes up by 77 per cent

BSNL to roll out 3G services in NE states, Chennai by Jan
Figures too can lie: IIP under cloud, govt works on new index
ICICI Bank surges 19 pc after CEO's assurance
Kamath asserts ICICI Bank has no liquidity problem
Billionaire investor Soros backs US' rescue plan

Axis Bank net surges 77% to Rs 403cr
Moody's, S&P also give clean chit
US stocks: Futures jump on bank rescues; Morgan higher
Core Projects and Technologies massive Fall
BSE Bulk Deals to Watch - Oct 13 2008
NSE Bulk Deals to WAtch - Oct 13 2008

Capital Goods
Futures and Options - Oct 13 2008
India Pharma
Markets pull back
Post Session Commentary - Oct 13 2008
Market recovers on firm global stocks

Suzlon Energy
CRR Cut, Infosys Technologies, Results Preview
Chemcel Biotech ends at 68% discount over IPO pric...
Reliance Industries
Market may remain volatile
Bullion metals drop for second straight day
Market may recover in volatile trade

SOurce:Sify,ET,Deadpresident,BS etc

Sensex (+781 pts) recover on FM comments, positive global cues

Mkt recover on FM comments, positive global cues

Bulls staged a strong comeback on Monday as sentiments turned positive on assuring comments from Finance Minister P Chidambaram and also as global markets opened higher after steps by European markets to curb on-going financial crisis.

After the worst fall last week, markets opened with a gap-up in line with other Asian markets on reports that European countries were collectively infusing funds to ease credit in banking system. In another development, UK government said it would inject $63 billion into three banks to keep liquidity crunch at bay.

Back home, Finance Minister Chidambaram’s statement that Indian economy was growing at a robust pace and assurances that the Reserve Bank of India will infuse more funds to fight credit squeeze boosted sentiments. Investors began taking long positions in frontline stocks which were battered heavily. Efforts by management of ICICI Bank to clear air on their financial positions helped as the scrip shot up recovering losses in previous sessions. “In early part of trade there was build-up of long positions and later as the market gained momentum, traders began to cover short positions, taking indices to higher levels,” said technical analyst, Birendra Kumar Singh of Religare Securities.

Bombay Stock Exchange’s Sensex closed at 11,309.09, up 7.42 per cent or 781.24 points. The index touched an intra-day high of 11,361.32 and low of 10,817.68. National Stock Exchange’s Nifty ended at 3490.70, up 210.75 points or 6.43 per cent. It touched a high of 3510.20 and low of 3272.90 during the day.

BSE Midcap Index was up 4.40 per cent and BSE Smallcap Index gained 3.85 per cent. “In this bear phase, Sensex has seen four pull-back rallies from its channel supports. Friday’s low of 10,239 was the fourth channel support. On earlier occassion, Sensex rallied some 3,000 points and now we may see 1,500-3,000 points rally. Targets for the Sensex will be 11,700, 12,000 and 12,500, provided it manages to close above 11,501. But if it falls below Friday’s low then we may see a continuation of negative trend and next target would be 9,898,” said Birendra Kumar. Reliance Communications (19.92%), Reliance Infrastructure (17.13%), ICICI Bank (16.71%), Sterlite Industries (15.99%) and HDFC Bank (12.58%) were the major Sensex gainers. Ranbaxy Laboratories (-5.88%) and ONGC (-1.02%) were the only losers. Market breadth remained extremely positive through the day. On BSE, there were 1687 advances against 926 declines.
---------------------------------------
Sensex gains 809 pts on strong global cues
Equities pull-back to close higher
Sensex above 11,000, ICICI Bank up 20%
Jet, Kingfisher join forces to tide over slump
-----------------------------------------------
AXIS Bank Q2 net up at Rs 402.91 cr
Bankex surges 12.3%, Axis Bank zooms 20% on strong Q2

AXIS Bank Ltd has announced the following Unaudited results for the quarter ended September 30, 2008:

The Bank has posted a net profit of Rs 402.91 crore for the quarter ended September 30, 2008 as compared to Rs 227.82 crore for the quarter ended September 30, 2007. Total Income has increased from Rs 2059.37 crore for the quarter ended September 30, 2007 to Rs 3239.45 crore for the quarter ended September 30, 2008.


Source: SIfy,ET

Investors Guide from ET and Mkt Outlook

Investor's Guide

Is there any respite on the anvil?13 Oct, 2008, 0455 hrs IST
Technical analysis assumes that all news, including what lies ahead, has been factored in the price of an asset. ETIG presents a snapshot of what the charts of Nifty and everything that affects it tell us...

The bull is dead, long live the bull 13 Oct, 2008, 0446 hrs IST, Shakti Shankar Patra
The very existence of free market capitalism seems to be at stake. JUST STAY OUT.

Markets in a bottomless pit 13 Oct, 2008, 0442 hrs IST, Deepak Mohoni
The market’s longterm (major) trend clearly remains down. It will be best to take the level to be crossed for a major uptrend (i.e. bull market) as the last but one intermediate top of 15,580, made on August 12.

Credit crisis may spur oil mergers in Africa 13 Oct, 2008, 0440 hrs IST
The global credit crunch can usher in a new wave of mergers and acquisitions (M&As ) in the oil sector, especially in Africa where small firms will find it difficult to bankroll exploration.

Oil on slippery terrain 13 Oct, 2008, 0435 hrs IST, Ramkrishna Kashelkar
Recent fall in crude oil prices will ease pressure on the government’s treasury, but refining companies are likely to take a hit.

Health check: Cipla and Dr Reddy's Labs 13 Oct, 2008, 0427 hrs IST, Kiran Kabtta
While Cipla follows a low-risk strategy of branded generics and alliances to grow in overseas markets, DRL believes in taking big bets.

Edelweiss maintains 'buy' recommendation on Opto Circuits 13 Oct, 2008, 0422 hrs IST
Edelweiss cancelled the proposed $100-million acquisition of an European company as the demanded price was not justifiable from an economic value perspective.

BNP Paribas maintains 'buy' rating on Shiv-Vani Oil & Gas 13 Oct, 2008, 0421 hrs IST
BNP Paribas maintains ‘buy’ rating on Shiv-Vani Oil & Gas, while reducing the target price from Rs 800 to Rs 522 on higher borrowing costs and multiple contractions.

Indian debt market: It ain't so grim after all 13 Oct, 2008, 0418 hrs IST, Karan Sehgal
The yield curve in the Indian debt market doesn’t necessarily suggest that doomsday is upon us.

Jain Irrigation Systems is good long-term bet for investors 13 Oct, 2008, 0413 hrs IST, Shikha Sharma....Jain Irrigation Systems’ expansion plans, diversified business model and improving efficiencies make it a good long-term bet for investors.
---------------------------------------------------
Maximum downside of 3,050

Last week saw global carnage with all the major markets down by double-digits. The Nifty lost over 14 per cent at 3,279.95 points and it hit a low of 3,199 on Friday. The Sensex was off 15.95 per cent and the Defty down 16.65 per cent as the rupee tested support at Rs 49 before settling at Rs 48.72.

The FIIs have sold close to Rs 5,000 crore of equity in October and Indian institutions have sold about Rs 900 crore. Smaller stocks were harder hit with the Nifty Junior and the Midcaps 50 down 19.9 per cent and 21 per cent respectively. The BSE 500 was off 17.5 per cent. Volumes were moderate and calculation of advance-decline ratios was absurd, since there were almost no advances.

Outlook
Next week prices are likely to move between 3,050-3,450. By closing below 3,800, the market set a maximum downside target of 3,050-3,100, which could be fulfilled. Momentum indicators are oversold but prices could fall until short-covering is triggered close to settlement. But any bounce will be very sharp and a 200-250 point rise in a single-session is likely sometime next week. Either way, big intra-day swings are probable.

Rationale
There has seldom if ever, been a down move of comparable dimensions. Chart patterns of support/resistance are now based on mid-2006 trading patterns. Volumes have been low. There is no major short-term resistance between the Friday close of 3,279 and 3,450. A single session of buying could therefore drive prices up a lot.

Counter-view
Gut-feel says delivery-backed selling will continue, interspersed with occasional short-covering. But there is a chance the market could recover and consolidate with range-trading between 3,400-3,800. The intermediate downtrend started in mid-July and could mature over the next week or two.

Bulls & bears
Stay away from anything outside the highly liquid F&O population. Instead of seeking bullish stocks, which are not easy to locate, long traders could focus on over-sold counters. This is where bounces could generate 7-10 per cent in a single session. Power Grid and Ranbaxy are among the few stocks that actually seem bullish.
On the short side, most stocks that made downside breakouts have fulfilled initial target projections. But many stocks look as though weakness could intensify. These include GMR Infra, HCL Tech, HDFC, Hero Honda, RCom, Idea, Reliance Capital, Dabur, HUL, RPower and Suzlon.
In terms of critical sectors, metals may be bottoming out. While Tata Steel, Sesa Goa and Jindal Steel look to have further downsides, SAIL, Hindalco and Sterlite appear to have found support. In banking, PSUs such as Canara, Indian Overseas, Oriental and SBI look much stronger than ICICI, Kotak, Yes Bank, etc. The IT sector seems to have some downside as well – HCL Tech and Wipro look quite exposed along with second-rank stocks like Rolta and the entire ITES segment.

MICRO TECHNICALS
HCL TechCurrent Price: Rs 170.25Target Price: Rs 145
The stock made a downside breakout on high volumes. It has a target of Rs 145 and in fact, hit that level briefly on last Friday. Keep a stop at Rs 179 and go long. Wide stops are necessary because there could be a huge intra-day swing. Below Rs 150, start booking profits.

RILCurrent Price: Rs 1,527Target Price: Rs 1,630

The stock made another downside breakout when it closed below Rs 1,630. It appears to have good support at the current level and short-covering could pull the price back till Rs 1,630. Keep a stop at Rs 1,510 and go long. Book profits above Rs 1,615.

Reliance PowerCurrent Price: Rs 124.15Target Price: Rs 112
The stock has made a downside breakout to hit another historic low. It has a possible target of about Rs 110. Keep a stop at Rs 127 and go short. Start booking profits below Rs 114. If the stock does climb above the Rs 128 stop, it could move till Rs 136 on the bounce.

Yes BankCurrent Price: Rs 71.95Target Price: Rs 65
The stock has made a downside breakout on a big volume expansion. It has a likely target of Rs 65 although there could be some support at current levels. If it bounces within the next three sessions, the upside target will be about Rs 90. Take a stop at Rs 75 and go short. Cover at Rs 65. If the stop is triggered, go long with a target of Rs 90 and a stop at Rs 74.

Source: ET,BS

Mkt Outlook,Stk analysis from BusinessLine

Index Outlook

Sensex (10527.8)
Last week’s rout in stock prices was on a scale that none of us have witnessed in our lifetimes. Sample this, the Dow Jones Industrial Average declined 18 percent, its worst weekly decline ever, Nikkei crashed 18 per cent in just three sessions, the unshakeable DAX, the German stock index, recorded a 21 per cent weekly decline and the volatility index of Chicago Board Options Exchange, the investor’s fear gauge, touched 77 on Friday. This index has not risen beyond 48 in the last two decades.
It was capitulation with a capital C as investors abandoned equities and stock prices were sucked in to a black hole. The decline was broad-based, giving investors no place to hide. The selling was spear-headed by the FIIs who have already pulled out close to $1 billion in October so far. The tally of net outflow this year has crossed $10 billion. Static open interest shows that traders are equally bewildered by the market’s moves.
With the breaking of the 12000 bastion and the 2000-point weekly slump, the possibility of resumption of the structural up-trend in the near future appears remote. Sensex closed emphatically below 12000 on Monday and went on to record a trough at 10240 on Friday. Oscillators have moved deep in to over sold zone, but the downward momentum is not showing any sign of abating yet.
The movement of the index last week has resolved the quandary that we were mulling over – whether the second leg of the correction from 21206 peak has ended at 15579 or if it will continue for a few more months resulting in a range between 12000 and 16000. The breadth, swiftness and the wide-spread devastation of the move last week leaves no room for doubt that the third wave from the 21206 is currently unfolding. We had indicated in our column dated September 28, 2008 that the minimum target for this wave was 10207. This target was achieved last week. Since we are reviewing the long-term counts in a separate column, we will stick to medium and short-term view in this week’s index outlook.
Both medium and short term trends are down. However, the index is approaching a band where a cluster of long-term supports are positioned. The levels where medium-term supports can be expected are - 9972 (July 2006 trough), 9700 (61.8 per cent retracement of the up-move from 2001 and 8800 (trough formed in June 2006). Even if the vertical decline halts at either of these levels, there would be a period of intense volatility for a few weeks before a bottom is formed.
The resistances for the week ahead would be at 11433 and then 11753. Failure to move above these resistances would mean that the down trend would continue. The negative medium term outlook will be mitigated only on a weekly close above 12500.

Nifty (3279.9)

Nifty declined below the 3800 level on Monday and recorded a trough at 3198.9 on Friday, way below our outermost medium-term target. Though we were anticipating a decline, the swiftness definitely took us by surprise. The supports on the long-term charts for the Nifty are now at 2940 (61.8 per cent retracement of the up-move from 2001) and then at 2595 (June 2006 trough). The medium term outlook will turn positive only on a weekly close above 3800.
Near term resistances would be at 3530 and 3610. Reversal below these levels will indicate further weakness. Subsequent resistance is at 3879.Global Cues
Most global indices lost between 15 to 25 per cent last week, proclaiming it as the worst week ever for stocks. The DJIA sliced through the support band between 10200 and 9900 to an intra week trough at 7882. The four-year old bull-market in DJIA has been decimated with the index just a whisker short of the 2003 trough at 7416. We are now staring at the possibility of a multi-year bear market in DJIA that corrects the entire up-move from 1932. The situation is similar in FTSE. Italy’s MIBTEL index has already reached its 2003 trough.
Asian and Latin American markets were relatively resilient, having yielded about 60 per cent of the gains made since 2003. Nikkei is the only exception, the index is just 600 points above its 2003 trough. Commodities too reeled as risk aversion spread to all asset classes. CRB index declined 9 per cent. This index has now given up more than 50 per cent of the gains made since 2001.
------------------------------------------------

STOCKS: Infosys Technologies: BuyInvestors with a one-two year perspective can buy the shares of Infosys Technologies, considering its attractive valuations and reasonable business prospects, despite the current rough ...

TECHNICAL ANALYSIS: Query Corner: What the charts sayI have purchased Themis Medicare and Kalindee Rail Nirman for Rs 250 and Rs 215 respectively. Please give your view on these ...

INTERVIEW: What the CRR cut means for investorsThe RBI’s recent move to cut the cash reserve ratio by 150 basis points was welcomed by many participants in the debt market as it is expected to infuse much wanted liquidity to the extent of Rs 60,000 crore into the banking

STOCK MARKETS: Some lessons from the dotcom crashAll said and done, when it comes to the stock market, it is the dotcom bubble that burst at the beginning of the new millennium that springs to mind. This fall did drive home an important tenet — valuations always matter, no matter how ...

Reliance Infra (October 12, 2008)
Query Corner: What the charts say (October 12, 2008)
Index Outlook (October 12, 2008)
Reliance (October 12, 2008)
SBI (October 12, 2008)
Tata Steel (October 12, 2008)
Infosys (October 12, 2008)
Unitech (October 12, 2008)

STOCKS: Union Bank of India: BuyInvestors can consider buying the Union Bank of India stock with an investment horizon of more than a year. A low price-to-book value, with a high return on equity, indicates the stock to be relatively undervalued. Investors should, however, ...

STOCKS: GlaxoSmithKline Consumer Healthcare: BuyFMCG stocks have withstood the market fall better than others, but with the ongoing ‘flight to safety’ bidding up their prices, frontline stocks in the sector are now quite expensive in relation to the rest of the ...

DERIVATIVES MARKETS: Another volatile swing on the cards for NiftyBears tightened their grip heavily on the markets causing one of the steepest falls in the history of ...

Stocks now valued at 2005 levelViews differ on whether valuations are attractive

ICICI Bank sends SMS to allay fears of depositors

Source:BusinessLine.

Infy Q2 marginally above estimates, RIL gas block has 40 Tcf gas reserves

Infy Q2 marginally above estimates
Infosys Q2 net up 30.2%, will not increase bid for Axon
Infy plays it safe
Infosys Q2 net up at Rs 1432 cr Declares 200% interim Infosys headcount rises above 1 lakh
Infosys FY09 dollar term guidance seen under pressure

The Spetember’08 quarter results of Infosys Technologies are marginally above analyst estimates. A weaker rupee against the dollar aided 11.6 per cent sequential growth in revenue while net profit rose by 10 per cent.

Infosys also reported improved operating profitability during the September quarter. Operating margin expanded by 264 basis points sequentially (QoQ) and 184 bps year-on-year to 33.1 per cent. Net margin showed a marginal drop of over 40 bps to 26.4 per cent sequentially and annually.

As hinted by a report in ET today, Infosys recorded a decline in its new client additions. These reduced to 40 in the September quarter from 49 a quarter ago and 48 a year ago. Though Infosys has given robust number for the latest ended quarter, it has cut its dollar guidance for FY’09 by over 5 per cent citing the global macroeconomic turmoil. For FY’09, it expects EPS to be $2.24, down from $2.32 earlier. Revenue is expected to be $4.72-4.81 billion, down from earlier estimation of $4.97-5.05 billion. Going by its revised guidance, Infosys now expects its revenue to grow by just over 13 per cent annually for FY’09. The stock was down 6 per cent to Rs 1,176 on BSE in the early morning trade.
--------------------------------------------
RIL gas block has 40 Tcf gas reserves

Reliance Industries' prolific D6 block in Krishna Godavari basin off the east coast contains in-place reserves of 40 Trillion cubic feet, said the firm's junior partner Niko Resources.

The company has made 20 gas and one oil discovery in the 7,645 sqkm KG-DWN-98/3 or D6 block in deep-sea of Bay of Bengal, said Edward S Sampson, Chairman of Board, President and CEO of Niko in analyst calls. These discoveries have resulted "in 40 Tcf gas in-place," he said.

Reliance is the operator of the block with 90 per cent stake, while Niko has the remaining 10 per cent. Dhirubhai-1 and 3 gas finds, the two discoveries that are being put into production in the first phase, would start pumping gas by December/January and by 2010 would almost double availability of gas in the country. The two fields would by mid-2009 produce 40 million standard cubic meters per day of gas, which would be doubled by 2010. Development plan has been submitted for nine out of the 15 satellite discoveries in the block, Sampson said. "40 additional exploration prospects are being targeted." Reliance is investing USD 5.2 billion in developing Dhirubhai-1 and 3 discoveries and would pump in an additional USD 3.5 billion to extend the peak output to 7-8 years.

The satellite fields would produce about 25 mmscmd, while another 9 mmscmd gas would be produced from the MA oil field in the same block. Reliance, last month started producing oil from the MA field and the output is expected to reach 20,000 barrels per day in one month from the current 5,500 bpd. Gas flowing along with the oil is currently being re-injected into the wells and this gas would flow together with Dhirubhai-1 and 3 gas. Peak oil output of 40,000 bpd from MA would be achieved in 6-8 quarters, he said.

Other CORP stories::::
Higher NPAs, slow biz growth troubling ICICI stock
Gold set to breach Rs 15,000 mark by Diwali
ICICI Bank facing no liquidity crisis: Chanda Kochhar
Re closes stronger at 48.12/17
Citi, Goldman see RBI easing liquidity

No unusual activity seen: SEBI
Japanese insurer files for bankruptcy
JSW to become India's largest pvt sector steel maker by Dec
Poor data inflow may delay new monthly WPI
ICICI Bank plunges 26 per cent
RIL hits 52-week low of Rs 1,480

Source:SIfy,ET,BS etc

Inflation rate slips to 11.80%, RBI cuts CRR by 150bps, IIP dn to 1.3 percent

Inflation rate slips to 11.80%
Inflation falls to 11.8%
Inflation at 11.80%; down from 11.99 WoW

Inflation inched down to 11.80 per cent for the week ending September 27, compared to 11.99 per cent in the week before.
The rate was below a median forecast of 11.98 per cent in a Reuters poll of analysts.

Inflation for the week ended August 2 was revised up to 12.91 per cent from 12.44 per cent.
The annual inflation rate was 3.36 per cent during the corresponding week of the previous year.

The wholesale price index is more closely watched than the consumer price index, which is published monthly, because it covers more number of products and is released weekly.
-----------------------------------
RBI cuts CRR by 150bps, to inject Rs 60,000cr tomorrow
RBI cuts CRR by another 100 bps
RBI cuts CRR to 7.5%
Factoring in the deterioration in the global financial environment, the Reserve Bank of India (RBI) today announced an additional 100 basis point reduction in the cash reserve ratio (CRR), or the proportion of deposits banks set aside. The move is aimed at injecting more liquidity into the system

On Monday, RBI had announced a 50 basis point reduction in CRR. Now, the CRR will fall to 7.5 per cent of the net demand and time liabilities, against 9 per cent at present, from the fortnight starting tomorrow. With today’s move, RBI said, Rs 60,000 crore will be injected into the system, instead of Rs 20,000 crore due to the 50 basis point cut announced earlier.
“This measure was undertaken with a view to injecting liquidity into domestic financial markets so as to alleviate the pressures brought on by the deterioration in the global financial environment. In the ensuing days, the global situation has worsened further. International stock markets and money markets had been adversely affected in a significant manner. Central banks across the world have responded to these extraordinary developments by synchronised policy actions including measures for liquidity infusion,” RBI said in a statement this morning.
In a coordinated move the US Federal Reserve, Bank of England, the European Central Bank and the Chinese central bank had lowered interest rates on Wednesday in the wake of the global financial turmoil.
In India, the call rates have stayed in double-digit zone. Rates had touched a high of 17 per cent following the payment of advance tax by companies. Today, according to data on the Clearing Corporation of India website, at 11.30 AM, the weighted average call rate was 19.77 per cent, with rates in the range of 11-23 per cent.
The cut, however, failed to cheer the stock markets, with the BSE Sensex 805 points down at 10,521 at noon. According to Bloomberg data, the rupee fell to an all-time low of 49.26 against the US dollar as foreign institutional investors have been pulling out money from the Indian stock markets.
The statement said that RBI is ready to respond swiftly to meet any liquidity requirements that may arise in the context of the highly volatile external situation. “The Reserve Bank is monitoring developments closely and continuously and would respond swiftly and even preemptively to any adverse external developments impinging on domestic financial stability, price stability and inflation expectations and the continuation of the growth momentum of the Indian economy. The Reserve Bank is committed to maintaining financial stability and active and flexible liquidity management using all policy instruments is an integral part of this objective,” the press release said.
In addition, it sought to comfort the market by saying that the macroeconomic fundamentals of the Indian economy remained “strong and resilient and that India's financial system is sound, well-capitalised and well-regulated”. It added, “Money and forex markets in India have been operating in a relatively orderly manner. The current domestic market conditions are essentially a reflection of the adverse developments and extreme uncertainty in international financial markets.”
RBI had not cut CRR since June 2003, when it was lowered 25 basis points to 4.50 per cent. The 150 basis point reduction is the steepest since 2001.
---------------------------------------------
Industrial growth slumped to 1.3% from 10.9% in August
Aug infrastructure output up 2.3 pc
August IIP at 1.3% vs 10.9% a year ago
Industrial growth nosedives to 1.3%

NEW DELHI: India's industrial growth slumped to 1.3 per cent in August this year, compared to a 10.9 per cent growth in August 2007, the government announced here Friday.

The figure was well below a forecast for growth of 6.1 per cent in a Reuters poll of economists. Output growth has fallen from the double-digit levels seen early last year as tight monetary policy and a stronger rupee lowered demand in the economy. Manufacturing production rose 1.1 per cent in August from a year earlier. Industrial output rose 8.1 percent in fiscal 2007/08 (April-March), compared with 11.6 percent in 2006/07.


Other Stories:
Rupee hits record low; RBI helps recovery
Chidambaram comments on markets’ free fall
JSW Steel Q2 output up 14%
Infosys Q2 net up at Rs 1432 cr

Source: ET,Sify,BS etc

Sensex ends 801 pts down on weak global mkts and declining IIP growth

Sensex ends 801 pts down on weak global markets and declining growth
Market retreats on dismal IIP growth at 1.3%
Inflation eases but no respite for markets; Sensex down 7%
Stock futures point to sharply lower Wall Street open

Investors, taking cues from bleeding global markets, pressed the panic button at the opening bell on the major Indian bourses this morning. As stock prices went tumbling down, the Sensex crashed by around 9.5% to 10,239.76 within the first few minutes.

Stockometer
Infosys Technologies reported a near 10% jump (quarter on quarter) in its net profit but the company's sales fell short of market expectations and the stock went down by over 17% to Rs 1040. Other IT majors and a host of old economy blue chips, including index heavyweights, too nosedived on selling pressure. Infosys Technologies, however, bounced back smartly - it even enjoyed a spell in the positive territory this afternoon - and significantly trimmed down its losses.
Top gainers
Just as it appeared that the Sensex would hit the 10% lower circuit and force a stoppage of trade, the Reserve Bank announced a surprise 150 basis point cut in Cash Reserve Ratio. The Sensex then staged a strong recovery and rose to a high of 10,904.13. The Nifty, which had plunged to 3198.95 in early trade, rallied to around 3400.
Worst losers
However, the recovery proved short-lived as dismal industrial production figures triggered another strong round of selling across the board. Thereafter, despite a couple of modest recoveries from lower levels, the benchmark indices Sensex and Nifty ended the session with huge losses today.
Scrip Scan
While the Sensex ended the day at 10,527.85 with a loss of 800.51 points or 7.07%, the Nifty settled at 3279.95 with a loss of 233.70 points or 6.65%.
Experts' Talk
Ranbaxy Laboratories (4.75%) and State Bank of India (2.3%) were the only gainers from the Sensex today. From the Nifty pack, except Ranbaxy and State Bank of India, the others ended in the negative zone.
Reliance Communications lost a little over 21%. ICICI Bank, despite regaining some lost ground, closed lower by as much as 19.7% today. Reliance Infrastructure lost 19.2%. Jaiprakash Associates eased by 16.25%. Tata Steel lost nearly 15%. Hindalco went down by 11.15%.
HDFC, DLF, BHEL and Larsen & Toubro lost 8% - 9%. Reliance Industries posted a loss of 7.4%. Hindustan Unilever, Wipro, Sterlite Industries, Grasim Industries, Bharti Airtel, Satyam Computer Services, NTPC, HDFC Bank, ACC, Mahindra & Mahindra, ONGC, Tata Motors, Tata Power, Tata Consultancy Services, Tata Motors, Maruti Suzuki and ITC also ended with sharp losses.

Suzlon Energy lost 17.65% today. Unitech (down 12.15%), Cairn India (down 11.9%) and Ambuja Cements (down 11.6%) also suffered heavy losses. Reliance Power, Tata Communications, HCL Technologies, Siemens, ABB, Zee Entertainment, SAIL, Cipla, Punjab National Bank, GAIL India, Sun Pharmaceuticals and Reliance Petroleum lost 5% - 9%.

Realty stocks Orbit Corporation, India Bulls Real Estate, HDIL, Mahindra Lifespace, Penland, Anant Raj Industries, Akruti City and Omaxe declined sharply.

Metal stocks Welspun Gujarat, Gujarat NRE Coke, Jindal Saw, Ispat Industries, Sesa Goa, Jindal Steel, Hindustan Zinc, Jai Corp and NMDC suffered sharp losses.

Among capital goods stocks, Elecon Engineering, Jyoti Structure, Punjab Lloyd, Usha Martin, Areva, Walchandnagar Industries, Alstom Projects, Reliance Industrial Infrastructure, Everest Kanto Cylinder, Crompton Greaves, Havells India, Gammon India, BEML, Bharat Bijli, AIA Engineering and Lakshmi Machine Works went down sharply.

Midcap and smallcap stocks were battered once again. Mirroring the sell-off, the Midcap and smallcap indices lost 8.34% and 7.31% respectively.

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The market breadth was very weak. Out of a total of 2619 stocks traded on BSE today, only 382 stocks closed on a positive note. 2189 stocks posted losses and 48 stocks ended flat.

Sensex sheds another 800pts, down over 50% from peak

Source:Sify,ET,BS etc