MyValueResearch

Dawn of 19th JUNE 09

INR@ 47.13, Inflation negative, liquidity all time high, FII inflows but yields rise, Primary articles fall silently, Stocks Scare on retreat of tax breaks.US 10Y 13 BP in 1 day on borrowing, Tread Reversal – Strong US data $ rises? , Oil up on Nigeria and OPEC.IIFCL disburses 54 billion looks for more , UBS to sell Hyderabad.

 

INR
INR @ 48.16 and could edge up on Friday, after hitting 1M lows in the previous session, supported by firm regional stocks markets but the $’s strength against majors could limit gains.    INR closed at 48.21/22 , 0.2 % weaker than its previous close of 48.13/14. It fell as low as 48.32 during trade, its weakest since May 18. 1M NDF @ 48.29 . SGX Nifty flat 13 points up.

 

BONDS
Yields are expected to edge up on Friday ahead of an auction of  150 billion of bonds later in the day with a rise in U..S. bond yields also denting sentiment in spite of the negative inflation figure   Concerns over heavy federal borrowing has bogged down sentiment in the market for months and    6.07 % 2014 ended at 6.59 % on Thursday, below Wednesday’s closing of 6.61 %.  10Y  at 6.91 % on Thursday, after only 16 deals, compared with its previous close of 6.89 %.  U.S.. bonds tumbled on Thursday after the U.S. Treasury announced another record round of auctions for next week and more data provided evidence the U.S. recession was easing.  Oil steadied above $71 a barrel on Friday after bullish U.S. economic data and supply concerns in OPEC member Nigeria boosted prices a day earlier. WPI turned negative 1.61% led by the primary articles but this did not signal a weakening economy and would not prod the RBI to cut rates further.

 

STOCK
Indian shares fell 1.8 % on Thursday, dropping for the fifth session in six, as profit-taking picked up momentum on market talk the cash-strapped Gov. may roll back tax breaks for some sectors.

 

CALL
Indian call money rates stayed near the RBI’s main borrowing rate of 3.25 % on Thursday as redundant cash with banks offset outflows off the system at ease. Call ended at 3.20/30 %, unmoved from its previous close. It has traded near 3.25 % in almost every session after the RBI cut the reverse repo rate to that level on April 21. RBI  absorbed 1.31 trillion on Thursday through.

 

GLOBAL MARKET

DJIA   8,555.60  +58.42  Nikkei  9,733.13  +29.41  FTSE          4,280.86   +2.40

Hang S 17,870.87  +94.21 US10Y 3.822  +0.136  EUR 1.3894  Yen 96.56  

Gold 940.50  Crude   71.28

*  The Dow and the S&P 500 rose on Thursday, breaking a three-day losing streak, as data on the job market and regional manufacturing revived hopes that the recession-hit economy is stabilizing.

*  Strength in Vodafone and defensive tobacco stocks pushed FTSE into positive ground by close on Thursday, but gains were muted and offset by sliding commodity stocks. 

*  Nikkei average rose 0.3 % on Friday after a rise in the U.S. Dow and S&P 500, with investors picking up shares such as Canon Inc that fell earlier in the week.

*  $ rose against the euro on Thursday as traders bought back the U.S. currency after the pair failed   to break a key technical level.     Price action was choppy as traders said moves in the foreign exchange market lacked conviction and most were unsure how to trade the $.

*  Gold futures ended lower on Thursday as the $ turned higher in a volatile session, and further unwinding of fund interest because of lower inflation expectations could lead to further weakness in the metal.

*  Copper prices settled a shade higher on Thursday, recovering from earlier losses with the help of a weaker $, but signs of significant economic improvement are still needed before higher prices can be sustained, traders and analysts said.

*  Oil prices gained on Thursday as data raised hopes of an economic turnaround and disruptions from OPEC member Nigeria stirred supply concerns.

 

INDIA FRONT PAGE

*  Reliance Infrastructure  and Hyundai Engineering is tipped to bag a contract to connect Mumbai’s Bandra-Worli sea link with Haji Ali at about 15 billion The formal announcement is expected in a day or two.

*  IIFCL has disbursed 54 billion to various projects. It plans to raise further funds from the bond market but has ruled out a public offering in the immediate future, its chairman was cited as saying.

*  Elder Pharmaceuticals has signed an agreement with US-based MD Anderson Cancer Center to conduct human experiments for its newly discovered anti-cancer drug.

*  DLF Brands, the retail arm of India’s largest listed real estate firm DLF is winding up its joint venture with Italian leather and luggage accessories major Piquadro to open a chain of monobrand stores.

*  UBS has put its outsourcing centres — in Poland and in Hyderabad — up for sale. The Switzerland-based bank is in talks with Indian IT companies such as Infosys and Wipro . The centres are valued at around $200 million.

*  Personal care products maker Emami Ltd is likely to merge its real estate business with Zandu Pharmaceutical Works.
 
*  Reliance Infrastructure has started negotiating with domestic banks to tie up funds for the second phase of the Mumbai Metro project, though it is yet to win the contract.