Europe debt fears hit mkts, Euro at year low

Europe debt fears hit mkts, Euro at year low


LONDON: European equities dived and the euro hit a new one-year dollar low on Tuesday, failing to win support after eurozone finance ministers agreed a 110-billion-euro (145-billion-dollar) Greek bailout.

In late morning deals, the London stock market slid 1.51 percent, Paris lost 2.04 percent and Frankfurt shed 1.36 percent. Elsewhere, Madrid tumbled 3.26 percent and Athens slumped by 3.71 percent.

In foreign exchange trade, the European single currency nosedived to 1.3088 dollars on Tuesday, plumbing the lowest level since April 28, 2009.

"Markets do not seem greatly impressed by the launch of the Greek rescue plan," said Unicredit analyst Marco Annunziata.

"The 110-billion-euro program... barely met expectations, without generating any positive surprise, and this probably helps explain the lukewarm reaction."

Over the weekend, eurozone finance chiefs approved an unprecedented three-year package of loans for Greece, struggling to shake off a crippling debt and deficit burden.

"The EU/IMF bailout of Greece provides enough funding for the next 12 months or so," said VTB Capital economist Neil MacKinnon.

Also Read

→ Gold hits 5-month high on Greece bailout concerns

→ IMF's dilemma: Help Greece, avoid villain label

→ Debt-hit Greece still spends billions on weapons

→ Greece's plan will convince markets: IMF

"However, the ability and willingness to bail out another eurozone fiscal miscreant is politically difficult," he added, hinting at other fiscally-challenged nations like Ireland, Spain and Portugal.

Of the 110 billion euros (145 billion dollars) to be made available to Greece, the eurozone would provide 80 billion and the International Monetary Fund 30 billion.

And in a policy U-turn, the European Central Bank agreed to accept Greece's junk-rated government bonds as collateral for loans.

In return, the Greek Socialist government will have to impose harsh austerity measures, as it seeks to slash its public deficit from nearly 14.0 percent of output last year to less than 3.0 percent by the end of 2014.

"The ECB's decision to suspend minimum collateral requirements for Greek bonds helps alleviate an imminent banking crisis but the ECB might find they end up doing this for other 'club Med' bonds," added MacKinnon.

More @ http://economictimes.indiatimes.com/markets/global-markets/Europe-debt-fears-hit-markets-Euro-at-year-low-against-dollar/articleshow/5890251.cms


*******************************************
Govt for RIL cutting gas output for Petronet sake; RIL says no

Nifty ends below 5150 on weak global cues

HCL signs $500 mn IT deal with US pharma giant MSD




Src: EConomictimes

China may 'crash' in 9-12 months: Marc Faber

China may 'crash' in 9-12 months: Marc Faber


SINGAPORE: Investor Marc Faber said China’s economy will slow and possibly “crash” within a year as declines in stock and commodity prices signal the nation’s property bubble is set to burst.

The Shanghai Composite Index has failed to regain its 2009 high while industrial commodities and shares of Australian resource exporters are acting “heavy”, Faber said. The opening of the World Expo in Shanghai last week is “not a particularly good omen”, he said, citing a property bust and depression that followed the 1873 World Exhibition in Vienna.

“The market is telling you that something is not quite right,” Faber, the publisher of the Gloom, Boom & Doom report, said in a Bloomberg Television interview in Hong Kong on Monday.

“The Chinese economy is going to slow down regardless. It is more likely that we will even have a crash sometime in the next nine to 12 months.”

Also Read

→ Bubble forming in the property maket of China: Mark Matthews

→ Risk of asset bubbles in emerging mkts: IMF chief

→ China sounds alert over new asset bubbles in world economy

An index tracking Chinese stocks traded in Hong Kong dropped 1.8% on Monday, the most in two weeks, after the central bank raised reserve requirements for the third time this year.

The Shanghai Composite has slumped 12% this year, Asia’s worst performer, as policy makers seek to rein in a lending boom that’s spurred record gains in property prices. China’s markets are shut for a holiday on Monday.

Copper touched a seven-week low and BHP Billiton, the world’s biggest mining company, fell the most since February on concern spending in the world’s third-largest economy will slow and after Australia boosted taxes on commodities producers. Rio Tinto, the third-largest, slid as much as 6 %.

Chanos, Rogoff

Faber joins hedge fund manager Jim Chanos and Harvard University’s Kenneth Rogoff in warning of a crash in China. China is “on a treadmill to hell” because it’s hooked on property development for driving growth, Chanos said in an interview last month.

As much as 60% of the country’s gross domestic product relies on construction, he said. Rogoff said in February a debt-fuelled bubble in China may trigger a regional recession within a decade.


More @ http://economictimes.indiatimes.com/markets/global-markets/China-may-crash-in-next-9-12-months-Marc-Faber/articleshow/5887630.cms





*****************************************
Top 5 stock picks | Mid-term picks | Gainers, losers & recos | Q4 Earnings




Heard on the Street: Tata Motors skids as US hedge offloads shares

Domestic fund goes ga-ga over Graphite India

An aggressive fund manager of a large domestic fund house is going bananas over Graphite India, a manufacturer of graphite electrodes.

According to the grapevine, this fund manager has bought a sizeable chunk of the stock recently, as he is betting on better prospects for the industry. On Monday, the stock, which has risen 16% in a month, closed at Rs 102, down almost 1% from the previous close.

According to analysts, growth of graphite electrodes, a key input in steel production through the electric arc furnace (EAF) route, will increase rapidly compared to EAF steel production in the next couple of years as steel manufacturers are stocking up graphite electrode inventory.

Further, the company is also expected to reap strong labour cost advantages as compared to its peers in the developed markets.

Tata Motors skids as US hedge offloads shares

Shares of Tata Motors snapped a three-day winning rally on Monday, ending at Rs 855.55, down almost 2%. According to the grapevine, a US-based hedge fund, whose Asia operations are run by a maverick fund manager, has offloaded a portion of their holding it had accumulated recently.

Brokers said the fund booked profits partly after the stock rose 6% last week compared to Sensex’s drop of 0.5%. The stock’s trating, which was a sell at most brokerages till recently, has been upgraded to a buy due to improvement in operations of Jaguar and Land Rover, which has been the cause of concern for most investors.

(Contributed by Apurv Gupta)

******************************************

Daily News Roundup - May 4 2010

Mumbai derailed, markets back on track

Biocon

Vijaya Bank

Subros

Indian Bank

Ashok Leyland Ltd

Src: Economictimes, DP blog and etc

Stocks Views

Indian Bank

Andhra Bank

Ashok Leyland Ltd

Tech Mahindra

Siemens

Idea Cellular Results

Glenmark Pharma

HDFC Q4 profit up 26% at Rs 926 cr

JSW Steel Q4 net profit at Rs 611 cr




Src: DP blog and Business-standard

Stock and Market Views

Strategies: How to trade 8 stocks that buzzed last week

April bonanza: TVS Motor sales rise 28%, Maruti up 30% YoY

ONGC Vs Reliance,which is a better stock to invest in?

India weighs capital controls with Re on rise

Warren Buffett to visit India, won't rule out investment

ArcelorMittal exploring tie-up with SAIL

Check out world's 10 most expensive hotel suites

India Inc's million-dollar executives

Heard on the Street


******************************************
Two attractive mid cap stocks Sanjay Chhabria

JSL: To ride the revival of global steel demand KRChoksey

IFCI: Momentum pick Anand Rathi

TECHNICAL ANALYSIS: Index Outlook: Uneasy lies the market
The Greek tragedy continued to cast its pall of gloom over financial markets last week. Stock prices across the globe crumbled on Tuesday on S&P downgrading Greek sovereign debt rating to junk status. Indian equities were relatively ...

STOCKS: Cadila Healthcare: Buy
Investors with a long-term perspective can consider taking exposure to the stock of ...

STOCKS: GlaxoSmithKline Pharma: Hold
Shareholders with a two-three-year investment horizon can retain their exposure to the stock of GlaxoSmithKline Pharma (GSK Pharma). A strong first quarter performance, planned launches from the company's product pipeline and the parent GSK ...

IPOS: Jaypee Infratech — IPO: Invest at cut-off
Investors with a penchant for risk can consider the initial public offer of infrastructure developer, Jaypee Infratech, a subsidiary of the listed Jaiprakash Associates. A unique combination of infrastructure and real-estate development, ...

IPOS: Satluj Jal Vidyut Nigam — IPO: Invest at cut-off
Investors with a long-term horizon can subscribe to the initial public offering from the hydro power generation company, Satluj Jal Vidyut ...

TECHNICAL ANALYSIS: Pivotals
RIL moved in line with our expectation, reversing lower from the intra-week peak of Rs 1,092 to achieve our short-term target of Rs 1,025. A short-term down-trend is currently in progress from the April 7 peak. Third wave of this move has ...

TECHNICAL ANALYSIS: Query Corner: RNRL trading above critical support
I am holding Reliance Natural Resources Ltd (RNRL) purchased at Rs 85. Please advise the long and medium-term outlook for this company. Rahul Gupta, Kumbesh, C. Mohandass, ...

TECHNICAL ANALYSIS: Sizzling Stocks: Cholamandalam DBS Finance (Rs 125.3)
Cholamandalam DBS Finance began the week on a relatively sedate note at Rs 101. The fireworks came much later, on Thursday when the stock closed 16 per cent higher. The rally continued on Friday to take the stock to the intra-week peak of ...

TECHNICAL ANALYSIS: Stock Strategy: Consider shorting Apollo Tyres, Bharti Airtel
Apollo Tyres (Rs 70): After hitting its all-time high at Rs 82.5 in April earlier, the stock has been witnessing a steady decline in price. The stock faces major support at Rs 47 and resistance at Rs 76. Only a close above Rs 76 would change ...


*****************************************

India Telecom 3G Update

Biocon

India Cements

Mahindra Holidays and Resorts

CESC

IDFC Ltd

Jaypee Infratech IPO Review

IDBI

Polaris Software

Canara Bank

Firstsource Solutions

Bharat Electronics

Madhucon Projects

Ashok Leyland

Everest Industries

Exide Industries Limited

Src: Economictimes, Businessline, DP blog and Valuenotes etc

2200 firms may go MNC way by 2024: PwC

2,200 firms may go MNC way by 2024: PwC


EW DELHI: India may overtake China as the largest source of new MNCs from the emerging markets, with over 2,200 domestic firms forecast to open overseas operations over the next 15 years, says a PricewaterhouseCoopers report.

According to the report titled the Emerging Multinationals, the competitive landscape is set to be transformed over the next decade as Indian and Chinese multinationals lead the way in seeking new markets outside their home markets.

"India is expected to produce the most new multinational companies, overtaking China as the emerging world's largest source of new multinationals. Over 2,200 domestic companies are projected to open operations outside over the next 15 years (between 2010 and 2024)," the report says.

Driven by the rapid pace of globalisation and revolution in information and communications technologies, the number of companies from the emerging markets choosing to set up operations abroad has increased in the past five years.

The report suggests this trend is expected to continue over the next 15 years, as new multinationals from emerging economies rise in prominence on the global economic stage.

Also Read

→ MNC, domestic pharma cos lock horns over patents in India

→ Cairn, BAT ahead of Unilever in most valued MNC in India list

→ People of Indian origin heading MNCs

→ Tamil Nadu looks to lure MNCs with country-specific zones

"It is encouraging to know that India will replace China as the largest source of new MNCs in the emerging world from 2018 onwards. The key drivers for this are the relative increase in both investment intensity as well as openness that the domestic economy offers," PwC India leader for markets and industries Jairaj Purandare said.

India and China would also be joined by an array of companies from Singapore, Russia, Malaysia and South Korea in terms of setting up MNCs.

According to the report, some of these new MNCs would become international powerhouses and would require services all over the world; for example, to support their IT and telecom networks.

PwC report says more and more new MNS are moving straight into the developed economies as opposed to setting up their first foreign operation in a neighbouring emerging market.

The global consultancy major used econometric techniques to project the number of new multinationals arising from a sample of 15 emerging economies over the next 15 years.

The countries analysed are --Argentina, Brazil, Chile, China, Hungary, India, Malaysia, Mexico, Poland, Romania, Russia, Singapore, South Korea, Ukraine and Vietnam.

*************************************

As Greece falters, fears stretch around the world

**************************************
NSE revises lot sizes of F&O scrips w.e.f. Apr 30

NSE revises lot sizes of F&O scrips with effect from April 30, 2010.

SEBI had advised exchange to standardize lot size for derivative contracts on individual securities once in every 6 months as per circular no. SEBI/DNPD/Cir- 50/2010 dated January 8, 2010. In pursuance to the revised methodology mentioned in the SEBI circular, NSE proposed to carry out revision of market lot for derivatives contracts.

For full list of revised lot sizes, click here...

Src: ET and Moneycontrol

Ripple effect on D-St as EU crisis spreads

Ripple effect on D-St as EU crisis spreads


contagion seems to be spreading fast across Europe. Ratings major Standard & Poor’s (S&P) on Wednesday cut its ratings on Spain by one notch to AA from AA-plus.

Earlier in the day, Indian shares joined the worldwide slide in equities and commodities, after S&P had lowered Greece’s debt rating to junk and that of Portugal by two notches on Tuesday.

Brokers and fund managers said the outlook on India’s economy and corporate earnings remained upbeat, notwithstanding the latest upheavals in Europe. But the flow of foreign money into the stock markets could be affected as global investors booked profits in emerging markets like India, to offset losses in other parts of the world, they said.

“The developments in Europe are unlikely to hurt the earnings potential of Indian companies, but investors may question the price-to-earning multiple of (Indian) equities,” said Kenneth Andrade, head-investments, IDFC SSKI Asset Management.

Also Read

→ PE firms take stock, use uptrend to exit

→ Global markets in a tizzy as S&P junks Greece

→ What do equity analysts' recommendations mean?

→ Funds rethink India, China strategy: Morgan Stanley

Indian shares are trading 16-17 times estimated earnings for the current financial year, and most investment managers say they are neither cheap nor too expensive.

BSE’s 30-share Sensex shed 310.54 points, or 1.8%, to close at 17,380.08. The 50-share Nifty crashed 92.90 points to close at 5,215.45. Key markets in Asia ended 1-2% down, and European markets too declined 1-2%.

“While valuations in India are not too stretched, in the immediate term, we remain anxious about the global risk trade unwinding,” said Keshav Sanghi, MD and head of equities, Citigroup Global Markets, India. Bond prices moved up a little and traders expect that the 10-year government paper to be auctioned on Friday will have a yield of below 8%.

Provisional data on the stock exchanges showed foreign funds were not heavy sellers even as many second-line shares fell sharply. Overseas investors net sold Rs 131 crore of shares while domestic institutions bought Rs 324 crore of shares on a net basis. So far in 2010, foreign funds have net bought $6 billion of Indian shares.

Market players expect more volatility on Thursday because of the expiry of derivatives contracts. If the downtrend persists, many traders holding long positions may choose not to carry them forward.

“Emerging markets in Asia have not yet seen a knock-on contagion impact on account of Greece and Portugal and retraced less than Brazil or Mexico today,” Mr Sanghi said. “I believe that there are quite a few macro international variables that still need resolution and the market is in a wait-and-watch mode near term,” Mr Sanghi added.

In the global markets, yields on Greek two-year debt soared to a record 26% and the euro hovered around near a one-year low against the dollar as investors worried that the sovereign debt crisis in parts of Europe may soon spread to markets as well.

Shares of metal, oil and gas, and realty companies were the worst affected, with the respective sectoral indices on BSE falling 2-3%. Shares of FMCG and healthcare companies closed flat to slightly lower, as investors moved a part of their money to defensive stocks.

“The problems of Greece do not have any direct implications for India,” said Vikram Kotak, chief investment officer, Birla Sun Life Insurance.

“But the big worry is a series of bad news—interest rate hike, inflation, high valuations, spate of share offerings—hitting all at once. We see the Sensex moving in a range of 14,000-18,000 over the next few months. But at the moment, a correction appears more likely,” said Mr Kotak.

Top gainers & losers I Q4 Earnings I Top 5 stock picks

Pre Market: Stocks seen subdued; F&O expiry watched

Downward pressure likely to stay in the near term

Great Offshore, Bharti, Indian Hotel, PVR potential investment targets

HDFC board to consider stock-split

Markets may head to 15K level: Shankar Sharma

SJVNL IPO

DLF Limited

Patni Computers

Container Corporation

Manappuram General Finance

Tara Health Foods

SJVNL IPO Analysis

Src: ET and DP blog

RNRL gains on hopes of early SC verdict in gas case | Citi downgrades RIL

RNRL gains on hopes of early SC verdict in gas case | Citi downgrades RIL


Shares of Anil Ambani owned Reliance Natural Resources (RNRL) and Reliance Power gained momentum after media reports that the Supreme Court may announce verdict in RIL-RNRL gas dispute case in a week’s time.

It has been reported that the Chief Justice of India KG Balakrishnan, who is leading the 3-member Supreme Court bench on the gas dispute case, will retire on May 11.

At 10:35 am, shares of RNRL were at Rs 66.70, up 7.06 per cent or Rs 4.40 on the BSE. It touched a high of Rs 67.85 and low of Rs 61.50.

Reliance Power was up 1.30 per cent or Rs 2.05 at Rs 159.95. It touched a high of Rs 161.65 and low of Rs 155.20.

Meanwhile, share of Reliance Industries continued its downtrend after disappointing quarterly results. The scrip was down 2.26 per cent at Rs 1037.25 on the NSE.

RIL and RNRL has been fighting a legal battle over the supply of 28 million units of gas for 17 years at $2.34 per unit to RNRL from the gas fields of Krishna-Godavari basin, which had been awarded to Mukesh Ambani’s RIL as part of the New Exploration or Licensing Policy (NELP).

***************************************

Reliance Industries discovers more oil in Cambay basin



MUMBAI: Energy major Reliance Industries has discovered more oil on India's western coast, raising the potential of the exploratory blocks it has been drilling, the company said on Wednesday.

India's biggest conglomerate whose businesses span petrochemicals, refining, oil and gas exploration and retail said the current flow was at 300 barrels of oil per day (bopd) at the onland exploratory block in the Cambay basin in Gujarat state.

The potential commercial interest of the discovery is being evaluated through more data gathering and analysis, it said in a statement. "The discovery is significant as this play fairway is expected to open more oil pool areas leading to better hydrocarbon potential within the block," it said.

Reliance holds 100 per cent participating interest in the block, and three earlier discoveries had a flow rate of 500 bopd. The company has so far drilled 14 exploratory wells in the block that covers an area of 635 square kilometres.

Last year Reliance, controlled by billionaire Mukesh Ambani, started pumping gas from its block in the vast Krishna Godavari (KG) basin off India's east coast, where it made the country's largest gas find. It has been producing 60 million standard cubic metres a day (mmscmd) of gas from the block.

Also Read

→ Accumualate Reliance: Institution Broking and Global Research

→ Regulator hikes hauling tariff for Gail, Reliance Gas in ‘haste’

→ Raghu Pillai to quit Reliance Retail by mid-year

→ Reliance Communications, US firm tie up for application stores

→ Reliance promises to come out with better results in FY10-11: Deven Choksey

At peak output of 80 million mmscmd it could nearly double India's gas output. Reliance also produces oil from its D6 block in the KG basin, and holds a stake in the Panna, Mukta and Tapti oil and gas fields off India's west coast.

The company, which owns the world's largest refining complex in Gujarat, earlier this month agreed to pay $1.7 billion to form a joint venture with Atlas Energy at one of the most promising natural gas deposit regions in the United States.

At 0745 GMT, shares in Reliance shares, which has a market value of $78 billion, were trading down 2.6 per cent at 1,033.80 rupees in a Mumbai market down 0.85 per cent.

*****************************************
Markets nosedive as Greece concerns loom




Src:Economictimes.indiatimes

Global mkts in a tizzy as S&P junks Greece

Global mkts in a tizzy as S&P junks Greece


MUMBAI: Stocks, bonds, crude oil and commodities tumbled as investors feared a wave of sovereign debt crisis, similar to the 1997 Asian crisis, after Standard & Poor’s cut Greece’s rating to junk and lowered Portugal two notches. Safe haven gold rose.

Investors fear the downgrade of these two nations may be the beginning of a series of such moves as most governments are burdened with debt after they spent their way out of recession following the credit crisis. Even the US is under threat of losing its top rating.

“The biggest risk now is that the market speculates against every single indebted peripheral country, and that could lead to a sovereign debt crisis,” Axel Botte, a strategist at AXA Investment Managers in Paris, told Bloomberg News. “The contagion risk is real. It’s much easier to bail out a bank than to bail out a country.”


The Stoxx Europe 600 Index slid 3.1% in New York, Standard & Poor’s 500 Index lost 1.6%, crude oil sank 2.4%, while copper plunged 4.3%. ADRs of ICICI Bank and HDFC Bank crashed. Gold rose 0.7%, or $8, to $1161.57 an ounce.

Standard & Poor’s cut Greece three levels to BB+, or junk, and lowered Portugal two steps to A- as they stare at a default. Greek notes slid earlier as concern deepened that the nation will ask investors to accept delayed or reduced debt payments.

The European Union, which had pledged to support Greece, has been dragging its feet on the conditionalities to extend a bailout. Emerging markets could be the worst-hit in a sovereign crisis as global investors pull out funds in a flight to safety.

Global investors could sell developing market stocks and bonds, and buy US treasuries or German bonds which are considered the safest. The cost of borrowing for both companies and countries are set to rise.

“We could see another wave of forced deleveraging, which could obviously affect any high-yielding assets, including emerging-markets debt,” Luis Costa, an emerging markets strategist at Citigroup, was quoted as saying by Bloomberg.

The average spread for emerging-market bonds over the US treasury climbed 18 basis points to 261 basis points, the largest increase since February.

A basis point is 0.01 percentage point. The MSCI Emerging Markets Index dropped 1.7% and Brazil’s Bovespa index tumbled 2.4%. The Shanghai Composite Index sank 2.1% earlier to a six-month low, the most since February 5.

“We’re entering a phase of blind panic,” said Orlando Green, an interest-rate strategist at Credit Agricole CIB in London. “Given the inaction of the euro nations to back Greece and to get things done quickly, we’ve found now this inaction has been a big obstacle. That’s not satisfying for the markets, and not for S&P either; hence, the downgrade.”



Related News:

Wall St slips on Greece, Portugal rating downgrade

******************************************
Pre Market: Weak start likely as Greece contagion pressures global equities

Funds rethink India, China strategy: Morgan Stanley

Top gainers & losers I Top 5 stock picks I Mid-term picks

Coromandel a good stock to buy: Gaurang Shah

SC verdict on RIL-RNRL gas case in next few days: Sources



*******************************************

Jayant Agro-Organics

Sterlite Industries

IRB Infrastructure Developers

Indian Bank

Maruti Suzuki

Mandhana Industries IPO Note

Tara Health Foods IPO Analysis

Tarapur - Mandhana - Nitesh - Grey Market Premiums

Src: ET and Moneycontrol and DP blog etc

Reliance Q4 Results

Reliance Q4 net rises; refining margins drag

Energy major Reliance Industries posted a 30% rise in quarterly profit but lagged estimates as lower-than-expected refining margins offset gains from higher gas output off India's east coast.

India's largest listed conglomerate, controlled by billionaire Mukesh Ambani, has been scouting for acquisitions overseas, and progress on that front will determine its outlook.

"We continue to seek growth opportunities within India and globally to accelerate further value creation," Ambani said in a statement.

Reliance, with interests in petrochemicals, refining, oil and gas exploration, and retail, posted January-March net profit of Rs 4710 crore (USD 1.1 billion) versus Rs 3630 crore a year earlier.

The year-ago results were restated to include figures from Reliance Petroleum, which it absorbed last year.

A Reuters poll had forecast quarterly net profit of Rs 5190 crore.

Margins at Reliance's flagship refining business stood at USD 7.5 a barrel for the quarter, but lagged market estimates of USD 8.3 a barrel. Analysts expect margins to rise as the global economy recovers.

The company recently said it would pay USD 1.7 billion to form a joint venture with Atlas Energy at one of the most promising natural gas deposit regions in the United States.

The outcome of a long-running gas dispute with Reliance Natural, led by Mukesh's younger brother Anil, will also have a bearing on the company's outlook.

Reliance is unable to hit peak gas production of 80 million standard cubic metres a day (mmscmd) at its D6 block in the vast Krishna Godavari basin in the Bay of Bengal due to customers not buying allocated volumes, and a lack of pipelines.

But analysts say current production of 60 mmscmd is still enough to boost results. Reliance began pumping gas from the block in April last year.

Shares in Reliance, India's biggest listed firm with a market value of about USD 78 billion, have dropped 8% in the past two weeks, while the broader Mumbai market is down 2.6%.

RIL Q4 nos disappoints street, but experts are not worried


*******************************************
Src: Moneycontrol.com