MyValueResearch

Dawn of Feb 26th

$ rise ,INR goes beyond 50.10 , MS says 52-53 on BOP, TV says diesel cut minister says no, REUTERS’ POLL – WPI -3.3% , GDP 6.2%, 34,000 CR. Of borrowing till March, Repo 27,000+ CR. Yields harden, SGX Nifty -3 Flat.

US Stocks fall on housing data, Obama optimistic but not specific, Cu and Oil rebound on fall in inventories

Piramal may find buyer, RCom wants to borrow 13,000 Cr in 3M

Rupee
INR fell towards 50 late trade on Wednesday, posting its weakest close since early December as the $’s strength against majors overpowered its early gains on a rising share market. INR closed at its low for the day of 49.96/97 , off a high of 49.72 and 0.2 % below its previous close of 49.87/88. It was the weakest

close since Dec. 3 and took its losses this year to 2.5 %. $ index , , was up 0.3 % at 1130 GMT. The $ gained as concern about the global economy crept back in to boost the perceived safe-haven currency, while the yen continued to fall broadly. Morgan Stanley economists said. The INR could test 52-53 in the next 4 to 6 months on BOP pressures, they said.

Bonds
Yields fell from 2-½ month highs on Wednesday as some investors bought debt on hopes the RBI will cut rates to shore up growth, but supply concerns dominated. Yields seesawed on television reports of an imminent cut in diesel prices and later comments by the oil minister rejecting any such move in the near term. 8.24 % 2018 ended at 6.65 %, off the day’s high of 6.71 %, a level last seen on Dec. 5. It had closed at 6.54 % on Tuesday. GDP data due on Friday will signal further rate cuts from the RBI. Reuters poll showed on Wednesday economic growth is expected to slow to a four-year low of 6.2 % in the December quarter, hit by the spreading global financial crisis and recession in major economies. Another 340 billion INRs worth of bonds to be auctioned in the remaining weeks of the current fiscal year in addition to supplies of T Bills and SDL..

Stocks
Recovered 0.9 % on Wednesday after falling for two consecutive sessions, with banks leading the rise on renewed hopes for a rate cut to boost consumer spending and stem a slowdown in growth. India’s WPI is seen falling to its lowest in nearly 15 months at 3.3 % in mid-February as cheaper fuels reduce prices of manufactured products, a Reuters’ poll showed. Outsourcers gained on INR weakness

Call
Cash rates were virtually unchanged on Wednesday on lower demand from banks . Call ended at 4.00/4.10 %, barely moving from Tuesday’s close of 4.05/15 %. Banks parked 774.55 billion with the RBI at i on Tuesday, the highest since Jan. 2, when the banks kept 779.35 billion . Banks parked 277.75 billion INRs with the RBI at auction.

Global
DJIA 7,270.89 -80.05 Nikke 7,560.31 +99.09 FTSE 3,848.98 +32.54 H Seng12,951.22 -53.86

US10Y 2.939 +0.139 EUR 1.2732 Yen 97.80 Gold 978.50 Crude 42.48

Ø U.S. stocks fell on Wednesday as more weak housing data reinforced fears about the economy, while banks weakened in late trading after the government launched tests to gauge their ability to withstand a long and deep recession. Sales of previously owned U.S. homes plunged much more than expected January, pulling homebuilders down 2.1 %.

Ø FTSE ended 0.9 % higher on Wednesday after a roller coaster afternoon, with gains from oils and financials countering weak miners and sharp falls on Wall Street after home sales data.

Ø Nikkei average rose 1.3 % on Thursday as Nissan Motor jumped on news that it plans smaller output cuts, helping ease market fears about slumping demand, while a weaker yen helped other exporters.

Ø USD strengthened on Wednesday as weak U.S. housing data and concerns about the global economy boosted the greenback’s appeal as a safe haven despite President Barack Obama sounding a more optimistic tone.

Ø Obama tried to reassure Americans in an address to Congress that the country would emerge stronger from the financial crisis. But analysts said he shed little light on how his administration would stabilize the economy. Data showing the pace of existing U.S. home sales fell 5.3 % in January .

Ø Gold prices fell below $950 an ounce on Wednesday, declining for a third straight day, in choppy consolidation trade, and volatility will likely remain high in the near term.

Ø Copper closed up for the third straight session on Wednesday, after cautiously positive comments from U.S. Federal Reserve Chairman Ben Bernanke, but analysts warned the demand outlook for the industrial indicator remained bleak amid the worst economic crisis in 80 years.

Ø Oil prices jumped 6 % to above $42 a barrel on Wednesday, after a U.S. government report showed a sharp drop in gasoline inventories in the world’s top consumer.

India Front Page
Ø Board of Satyam Computer Services is likely to finalize the pricing guidelines for preferential allotment to a strategic investor and the criteria for short listing potential bidders at a meeting on Thursday.

Ø French drug major Sanofi-Aventis has emerged as the front-runner to buy a substantial stake in Piramal Healthcare

Ø The income-tax department has ordered a special audit of the accounts of realty firm DLF and would take necessary action after scrutiny.

Ø SEBI has imposed a penalty of 1.5 million rupees on India bulls Securities for buying and selling the same quantity of derivatives contracts on the same day between January to March 2007.

Ø SRS Orion Investment has filed a petition before the Company Law Board, demanding 8.06 billion rupees from the troubled Maytas Properties. SRS Orion has reportedly invested 6 billion rupees in Maytas.

Ø Reliance Communications will raise 130 billion rupees in debt over the next three months to meet certain capex requirements and scheduled debt repayment obligations.

Ø Airlines in India planning to enter into passenger sharing alliances with global carriers will need to take prior permission from the government.