Sensex loses 137 points, Nifty ends below 7600 ahead of Budget

09 Jul 2014

1

03:35 pm Market closing
Just a day ahead of Budget, investors grew cautious and preferred to book profits taking away a major chunk of gains from the market. The Sensex was down 137.30 points at 25444.81 and the Nifty was down 38.20 points at 7585.00. About 909 shares have advanced, 2069 shares declined, and 87 shares are unchanged.

ONGC, ITC, Hindalco, GAIL and Tata Steel were top gainers in the Sensex. Among the losers were Bajaj Auto, Coal India, Maruti, Tata Motors and M&M.

03:20 pm Auto recall
Homegrown auto major Mahindra & Mahindra is recalling around 23,000 units of a select variant of its popular sports utility vehicle Scorpio to rectify faulty pressure regulating valves. The company said it would carry out preventive inspection of some parts of its Scorpio Ex variant manufactured between May 2012 and November 2013.

"This recall is limited only to the Scorpio Ex variant manufactured during the said period and does not affect any other Scorpio variants," the company said in a statement.

03:10 pm Power output: Power generation fell short by nearly 8 billion units of the target of 975 billion units in the last financial year.

"Electricity generation by the utilities was targeted at 975 billion units of which 967.15 billion units was achieved during the financial year 2013-14," the pre-budget survey tabled in Parliament today said.

However, the power generation in 2013-14 was higher by 6 percent compared to production of 912.06 billion units in 2012-13. The electricity generation through thermal power plants grew by 8.3 percent in 2013-14. Power production from gas-based plants declined by 33.4 percent during the year, the survey said.

03:00pm Market Update: The Sensex plunged 193.83 points to 25388.28 and the Nifty slipped 56.55 points to 7566.65. About 793 shares have advanced, 2107 shares declined, and 84 shares are unchanged.

Shares of M&M, Maruti Suzuki, Coal India, Tata Power, Bajaj Auto and Jindal Steel declined 3-5.5 percent.

02:50pm IndusInd Bank posts stable nos in Q1
Private sector lender IndusInd Bank met street expectations with the net profit in first quarter of current financial year 2014-15 rising 25.7 percent year-on-year to Rs 421 crore supported by stable asset quality and higher other income.

Net interest income, the difference between interest earned and interest expended, increased by 17.7 percent on yearly basis to Rs 800 crore and other income (non-interest income) 22.5 percent to Rs 576.4 crore in the quarter gone by. However, net interest margin declined marginally to 3.66 percent from 3.75 percent on quarter-on-quarter basis.

According to CNBC-TV18 poll estimates, analysts had expected the bank to report net profit of Rs 420 crore and net interst income of Rs 805.3 crore for the quarter.

02:40pm Coal India needs to restructure, says FM
India needs to restructure state behemoth Coal India quickly to raise output to feed fuel-starved power plants, the finance ministry said in a Economic Survey report, as the country grapples with rising imports amid a push for electricity to all.

Coal India (CIL), the world's largest coal miner, accounts for about 80 percent of India's production of the black rock but has failed to meet its output targets for years due to delays in obtaining environmental approvals to expand mines and what critics say are inefficiencies owing to its size.

"The process of restructuring CIL needs to be pushed through swiftly to boost coal production," said the finance ministry in the Economic Survey report presented to parliament on Wednesday.

02:30pm Experts on Economic Survey
The finance minister Arun Jaitely tabled the Economic Survey for the year 2013-2014, which projected the gross domestic product (GDP) growth at 5.4-5.9 percent for FY15 with the possibility of the GDP hanging around the lower side of the projections.

Rupa Rege Nitsure, Chief Economist & General Manager, Bank of Baroda believes the figure of 5.4 percent was slightly exaggerated given the government is yet to deal with the downside risks to GDP due to low rainfall and geo-political tensions.

Sajjid Chinoy, JPMorgan believes the mention of the new FRBM Act and government's will to target the headline inflation is positive, though how much of it is translated into the Budget speech tomorrow is yet to be seen.

Even Samiran Chakraborty, Head of Research, Standard Chartered Bank believes that the acknowledgment of FRBM Act and the need for a framework to target CPI inflation in the very first Economic Survey is commendable.

Jayesh Mehta, MD & Country Treasurer, Bank of America and Pronab Sen, former Pr. Adviser, Planning Commission also contributed to the discussion.

02:20pm Infosys Q1 earnings on Friday
According to CNBC-TV18 poll estimates, profit after tax of the company is seen going down 10.8 percent sequentially to Rs 2,667 crore on revenues of Rs 12,814 crore that may fall 0.4 percent compared to March quarter (FY14). However, dollar revenue is likely to increase 2.29 percent to USD 2,140 million in April-June quarter as against USD 2,092 million in previous quarter.

Earnings before interest and tax (EBIT) may fall 10.9 percent at Rs 2,924 crore and margin may decline 270 basis points quarter-on-quarter to 22.8 percent during the quarter due to rupee appreciation (3 percent) and wage hike (offshore wages hiked 6-7 percent and onsite 1-2 percent).

02:10pm Market Expert
The market is in for a good time ahead, but first it needs to digest the steep run-up and take a breather, says Sanju Verma CEO, Violet Arc Global Managers. She sees profit-booking as market seems to be pausing after the big run. She expects the Nifty to cross 8000 in a post-budget move.

She advises not to trade tomorrow as volatility will be very high in the market. ''I would recommend traders to buy a bull strangle,'' she told CNBC-TV18 in an interview.

Verma is bullish on the metal sector at the moment.

02:00pm Equity benchmarks remained under pressure amid volatility in afternoon trade weighed down by auto, technology, power, healthcare and capital goods stocks. However, the buying in oil & gas post fall in Brent crude and FMCG stocks continued to support the market.

The Sensex declined 78.80 points to 25503.31 and the Nifty lost 20.15 points to 7603.05. About 918 shares have advanced, 1957 shares declined, and 89 shares are unchanged.

Finance Minister Arun Jaitley presented the Economic Survey in parliament ahead of Union Budget tomorrow. He estimates FY15 GDP growth at 5.4-5.9 percent. FY15 GDP growth is likely to be on lower side of projections, says FM, adding subsidy reforms are essential to fiscal consolidation.

He says fiscal consolidation remains imperative for the economy. Improved twin deficit may lead to higher but gradual growth," he adds.

1:50 pm Buzzing: Shares of Claris Lifesciences , the Ahmedabad-based pharmaceutical company, gained as much as 7.3 percent intraday on Wednesday on getting approval from United States Food and Drug Administration (USFDA) for its finished dosage plant and API plant. "Claris has received a report from USFDA for the inspection it conducted classifying the finished dosage plant and active pharmaceutical ingredients (API) plant as acceptable," says the company in its filing. It has three manufacturing plants at its campus on the out skirts of Ahmedabad.

1:40 pm Rupee check: The rupee is trading at 59.72/73 versus its Tuesday close of 59.78/79 and off the session low of 59.9350, as heavy dollar selling by foreign banks boosts but further falls likely to be averted ahead of the budget on Thursday.

Most Asian currencies also trading stronger versus the dollar.

USD/INR is seen moving in a 59.60 to 60.00 range during the session with strong support seen for the pair at 59.65 levels, dealers say.

1:30 pm Buzzing: Shares of State Bank of India (SBI), the largest lender in India, gained as much as 1.5 percent intraday after Bank of America Merrill Lynch (BoAML) says the stock could be worth Rs 4,500-5,000 by FY18, implying 65-85 percent upside potential.

"We think we are getting closer to the ''sweet spot'' in the credit cycle and SBI is a much bigger beneficiary of the cycle turn. The Budget announcement on July 10 may provide an important catalyst for this name, says BoAML in its note.

1:20 pm Market outlook: The market is in for a good time ahead, but first it needs to digest the steep run-up and take a breather, says Sanju Verma CEO, Violet Arc Global Managers. She sees profit-booking as market seems to be pausing after the big run. She expects the Nifty to cross 8000 in a post-budget move. She advises not to trade tomorrow as volatility will be very high in the market. ''I would recommend traders to buy a bull strangle,'' she told CNBC-TV18 in an interview. Verma is bullish on the metal sector at the moment.

1:10 pm Expert opinion on Eco Survey: Rupa Rege Nitsure, Chief Economist & General Manager, Bank of Baroda believes government's FY15 GDP target of 5.4 percent is slightly exaggerated given the government is yet to deal with the downside risks to GDP due to low rainfall and geo-political tensions.

"It is slightly more optimistic but since its government's official forecast it has to be slightly optimistic. But given the downside risks to gross domestic product (GDP) growth because of deficient monsoon and uncertainties associated with geopolitical situation, it is slightly optimistic but this is what is expected from all official estimate. I think it is slightly exaggerated," she said.

The market has become quiet after Finance Minister tabled Economic Survey ahead of Union Budget tomorrow. The Sensex is down 44.18 points at 25537.93 and the Nifty is down 12.40 points at 7610.80.

About 824 shares have advanced, 1883 shares declined, and 97 shares are unchanged.
 
The Economic Survey pegs FY15 GDP growth at 5.4-5.9 percent. It says government needs new FRBM act with teeth. The survey further says subsidy reforms are essential to achieve fiscal consolidation and expects room for monetary easing later this fiscal.

Japan's Nikkei share average fell to a 1-1/2-week low as the stronger yen hurt exporters, while cooler-than-expected China inflation data also soured sentiment.

Risk appetite was also curbed as investors stayed cautious before the earnings season. The Nikkei ended 0.1 percent lower to 15,302.65, its lowest closing level since June 30.

The broader Topix slipped 0.4 percent to 1,270.82, and the JPX-Nikkei Index 400 dropped 0.2 percent to 11,551.84.

01:00pm Experts on Economic Survey
The finance minister Arun Jaitely on Wednesday released the Economic Survey for the year 2013-2014, which projected the gross domestic product (GDP) growth at 5.4-5.9 percent for FY15 with the possibility of the GDP hanging around the lower side of the projections.

Rupa Rege Nitsure, Chief Economist & General Manager, Bank of Baroda believes the figure of 5.4 percent was slightly exaggerated given the government is yet to deal with the downside risks to GDP due to low rainfall and geo-political tensions.

The proposal to get a new Fiscal Responsibility and Budget Management (FRBM) Act and the need to target the consumer price index (CPI) inflation was welcomed by the economists.

Sajjid Chinoy, JPMorgan believes the mention of the new FRBM Act and government's will to target the headline inflation is positive though how much of it is translated into the Budget speech tomorrow is yet to be seen.

Even Samiran Chakraborty, Head of Research, Standard Chartered Bank believes that the acknowledgment of FRBM Act and the need for a framework to target CPI and inflation in the very first Economic Survey is commendable.

12:55pm Nikkei update
Japan's Nikkei share average fell to a 1-1/2-week low as the stronger yen hurt exporters, while cooler-than-expected China inflation data also soured sentiment.

Risk appetite was also curbed as investors stayed cautious before the earnings season.

The Nikkei ended 0.1 percent lower to 15,302.65, its lowest closing level since June 30.

12:52pm Finance minister expects industrial recovery seen in April to continue. Economy can look forward to better growth prospects in FY15, he adds.

12:50pm Reserve Bank of India identified 5 sectors as stressed sectors, which are infrastructure, iron & steel, textiles, aviation and mining. "We need to permit commercial coal mining by private companies," FM says.

12:45pm According to Economic Survey, balance of payment position of the country improved 'dramatically' in FY14, but sustaining improved BoP will be a challenge in medium-term, FM says.

12:40pm Finance minister says pricing of subsidised fertiliser skewed nutrient usage. "Rollout of nutrient fertiliser subsidy flawed without urea," he adds.

According to him, arbitrary cane price fixing by states has been hitting sugar mills. "We need to optimise procurement cost of power, he says.

12:35pm According to Economic Survey, current account deficit for current financial year 2014-15 may be limited to about USD 45 billion, which is 2.1 percent of GDP.

FM sees signs of revival in aviation sector.

12:30pm FM, in its first Economic Survey, says long-term debt accounts for 78.2 percent of total external debt. "We need mechanism to cope with capital flight and global environment. Revision to 7-8 percent growth can occur only post next fiscal," he adds.

He sees RBI taking accommodative stance as inflation eases.

12:25pm According to finance minister, fiscal consolidation and supply-side steps will aid monetary management. He expects room for monetary easing later this fiscal and sees global recovery improving in FY15.

Goods and Services Tax (GST) introduction will help state resource-raising potential, he adds.

12:20pm FM Arun Jaitley says Economic Survey only shows gravity of economic situation. "Fiscal deficit needs to move downwards in next 2 years and we need to bring down inflation in a calibrated manner," he adds.

According to him, WPI inflation is likely to moderate by 2014-end. He sees inflation easing in FY15 on softening global prices.

12:15pm Market Update: Equity benchmarks fell further post Economic Survey that indicates NDA government has tough task to bring economy back on track. The Sensex slipped 129.54 points to 25452.57 and the Nifty declined 34.20 points to 7589.

About 802 shares have advanced, 1866 shares declined, and 83 shares are unchanged.

12:10pm FM in its Economic Survey 2013-14 says fiscal consolidation remains imperative for economy. Improved twin deficit may lead to higher but gradual growth," he adds.

According to him, downside risk to economy is due to geopolitical tensions and from poor monsoon and investment climate.

Balance of Payment position improved 'dramatically' in FY14 and industry growth is likely to revive in next 2 years, he adds.

12:05pm According to Economic Survey, estimates for FY15 GDP growth is at 5.4-5.9 percent. FY15 GDP growth is likely to be on lower side of projections, says FM.

He says subsidy reforms are essential to fiscal consolidation.

12:00pm The market remained lacklustre in noon trade as the Finance Minister Arun Jaitley tabled Economy Survey for 2013-14. The Sensex declined 37.13 points to 25544.98 and the Nifty lost 8.50 points to 7614.70.

About 833 shares have advanced, 1763 shares declined, and 78 shares are unchanged on the BSE.

Shares of Tata Motors, M&M, Sesa Sterlite, Bajaj Auto, Coal India and Dr Reddy's Labs fell 1.5-2.6 percent while Hindalco, ONGC, Gail, Tata Steel, BHEL, BPCL and Grasim gained 1-3 percent.

According to Economic Survey 2013-14, Finance Minister says there is need of common market for agricultural commodities. "We need to expand decentralised procurement for public distribution system (PDS) and need to review nutrient-based fertiliser subsidy," he adds.

He says raising tax-GDP ratio is key to fiscal consolidation. "We can look forward to better growth prospects in FY15," he adds.

11:50 am FII view: Laurence Balanco, CLSA says the bearish price/momentum divergence suggests that last week's attempt to breakout above the 7625-7715 resistance zone is a classic failure.

"As such we expect the Nifty to continue to range trade below the 7625-7715 area into August/September before the long-term uptrend resumes," he adds. According to him, pullbacks to the 6861-7263 area in the coming weeks should be seen as an attractive buying opportunity in anticipation of the long-term uptrend resuming.

11:40 am Budget hopes: In an interview to CNBC-TV18, Sunil Munjal, Joint MD, Hero MotoCorp, said the Union Budget will focus on improving the fiscal situation and will provide the long-term vision of the government.

Munjal feels the government may line up its policy intent in the Union Budget and expects material announcements on GST. He expects it to be implemented as early as 2015.

Munjal thinks economic growth and job creation would be the centre point for the Budget. He feels the government should try to focus on specific 4-5 industries which have a multiplier effect. ''Auto, tourism, house construction, garments and textiles are some of the industries which have a potential to become global leaders,'' he said.

11:30 am Buzzing: Shares of Claris Lifesciences, the Ahmedabad-based pharmaceutical company, gained as much as 7.3 percent intraday on getting approval from United States Food and Drug Administration (USFDA) for its finished dosage plant and API plant.

"Claris has received a report from USFDA for the inspection it conducted classifying the finished dosage plant and active pharmaceutical ingredients (API) plant as acceptable," says the company in its filing. It has three manufacturing plants at its campus on the out skirts of Ahmedabad.

11:20 am Market outlook: Dhirendra Tiwari, Head-Research, Antique Institutional Equities sees no structural problem with the market as the sell-off was observed in sectors and stocks that rallied strongly. He maintains his bullish stance and advises investors to buy quality cyclicals and IT as export proxies. The market will rally on slightest hint of positive news post Budget, he says in an interview with CNBC-TV18.

He expects PFC and REC to be the biggest beneficiaries of power reforms. Amongst banking stocks, he likes PNB and Yes Bank . With a 1-2 year view, buy Voltas and Cummins India , he adds.

11:10 am Infosys to buy? Analysts are bullish on Infosys expecting a firm April-June revenue growth. The stock has recovered around 14 percent after hitting a recent low of Rs 2924 around May-end while it is down 4.3 percent on a year-to-date basis.
 
Citi advises to buy it with an increased target of Rs 3875 per share on supportive valuations, stating that every fall is a good short-term buying opportunity. It believes that directionally Infosys' business is improving and margins are trending higher given the ongoing cost optimisation efforts.

HSBC has an overweight rating on the stock with a target of Rs 3920. It believes Infosys is likely to maintain its full year guidance of 7-9 percent, which is effectively a 50 bps cut due to cross currency benefit. "To achieve the top end the company needs 3.5 percent CQGR 2Q-4Q, which is nearly unachievable at this stage for Infosys," it says.

Though the market recouped some of its losses incurred in early trade, the market is still very volatile as it gears up for the Economic Survey. The Sensex is up 66.49 points at 25648.60 and the Nifty is up 21.25 points  at 7644.45. About 874 shares have advanced, 1524 shares declined, and 79 shares are unchanged.

Hindalco is up 4 percent. ONGC, Tata Steel, BHEL and GAIL are top gainers in the Sensex. Dr Reddy's Labs, Tata Motors, Bajaj Auto, Hero MotoCorp and M&M are major laggards.

Finance Ministry sources say the government is only six weeks old and the Budget must be seen in that context.

It is learnt that the budget will lay emphasis on roadmap for revival, highlighting reform intent. It may lay down intent of hiking FDI caps. The Budget may focus on better targeting of LPG, kerosene subsidy and promoting renewable energy.

10:58am Claris gets USFDA approval
Shares of Claris Lifesciences, the Ahmedabad-based pharmaceutical company, gained 4 percent on getting approval from United States Food and Drug Administration (USFDA) for its finished dosage plant and API plant.

"Claris has received a report from USFDA for the inspection it conducted classifying the finished dosage plant and active pharmaceutical ingredients (API) plant as acceptable," says the company in its filing. It has three manufacturing plants at its campus on the out skirts of Ahmedabad.

10:50am MCX in demand
Shares of Multi Commodity Exchange of India rose 4 percent as maverick investor Rakesh Jhunjhunwala bought nearly 2 percent stake in it for over Rs 66 crore.

According to information available with the stock exchanges, MCX's erstwhile promoter Financial Technologies (FTIL) has sold a total of 10.19 lakh shares, amounting to 2 percent stake in the commodity bourse. Jhunjhunwala picked up 10 lakh shares of MCX on an average price of Rs 664 apiece, data showed. This values the transaction at Rs 66.4 crore.

10:40am Auto sales data
According to data available with Society of Indian Automobile Manufacturers (SIAM), domestic passenger vehicle sales increased 11.2 percent year-on-year to 2.18 lakh units in June and passenger car sales jumped 14.8 percent to 1.6 lakh units during the same period.

SIAM says 2-wheeler sales grew 13 percent to 12.6 lakh units and motorcycle sales rose 9.6 percent to 8.76 lakh units compared to a year-ago period. Utility vehicle sales in June shot up 6.9 percent to 43,849 units.

Total vehicle exports increased 16.6 percent to 2.7 lakh units in June, says SIAM.

However, during the same period, commercial vehicle sales fell 9 percent to 51,119 units and light commercial vehicle sales dropped 12.5 percent to 32,705 units. Medium and heavy commercial vehicle sales slipped 2.1 percent to 18,414 units year-on-year.

10:30am Expectations from Economic Survey
Economic Survey is likely to be this government's statement of intent, but cannot ignore the fact that we are in a very different political situation compared to the last 30 years, says Subir Gokarn of Brookings India.

He is also not very sure if tomorrow's Union Budget will be able to meet the high expectation given the economic situation we are in. Speaking to CNBC-TV18, Gokarn says this government can afford to take a long-term view and Finance minister Arun Jaitley must articulate his vision very clearly tomorrow. ''You may not see the intensity that is expected from this Budget. Rather full Budget in FY15-16 will be where more radical and dramatic announcement can be expected.''

Besides monsoon has been a constant threat this year and the FM will have to take cognizant of the situation. Gokarn sees inflation at 7.5 percent,  tax revenue at 15-15 percent and GDP growth at 5.3 percent in this fiscal.

10:25am Infosys Q1 earnings on Friday
According to CNBC-TV18 poll estimates, profit after tax of the company is seen going down 10.8 percent sequentially to Rs 2,667 crore on revenues of Rs 12,814 crore that may fall 0.4 percent compared to March quarter (FY14). However, dollar revenue is likely to increase 2.29 percent to USD 2,140 million in April-June quarter as against USD 2,092 million in previous quarter.

10:20am Brent falls further
Brent crude fell below USD 109 a barrel as Libya restarted an oil field, on track to drop for an eighth session in what would be its longest losing streak in over four years. Easing worries over possible disruptions to supply from the conflict in Iraq also dragged on prices.

August Brent crude had declined 12 cents to USD 108.82 a barrel by 0318 GMT, down nearly 6 percent from a nine-month high reached in June.

US crude for August delivery was up 3 cents at USD 103.43 a barrel, after Tuesday's settlement marked its longest losing run since December 2009. The price spread between the two benchmarks is the narrowest in nearly a month, reports Reuters.

10:15am ITC on buyers' radar
Credit Suisse has maintained outperform rating on the stock with a target of Rs 400. The brokerage is positive that excise duty hike on cigarettes is unlikely even though investors are nervous due to the Health Minister's demand for a 100 percent-plus hike in cigarette excise.

''The past track record of BJP governments both in the states and at the centre does not have any disruptive moves on cigarettes. Also, such a move will create a large illicit cigarette market. Another negative scenario will be a change in cigarette excise duty to ad valorem, which is also a low probability event,'' it said in a report.

10:10am FII View
Laurence Balanco, CLSA says the bearish price/momentum divergence suggests that last week's attempt to breakout above the 7625-7715 resistance zone is a classic failure. ''As such we expect the Nifty to continue to range trade below the 7625-7715 area into August/September before the long-term uptrend resumes,'' he adds.

According to him, pullbacks to the 6861-7263 area in the coming weeks should be seen as an attractive buying opportunity in anticipation of the long-term uptrend resuming.

10:00am Equity benchmarks recouped early trade losses supported by banks and FMCG stocks. The Sensex fell 31.06 points to 25551.05 after recouping 150 points from day's low and the Nifty lost 8.25 points to 7614.95.

The broader markets dropped further with the BSE Midcap and Smallcap indices falling 0.9 percent and 1.6 percent, respectively, in addition to 4 percent fall in previous session. About 513 shares have advanced, 1532 shares declined, and 42 shares are unchanged.

India's largest lender State Bank of India gained over a percent followed by ICICI Bank, HDFC Bank and Axis Bank with marginal gains. Index heavyweight Reliance Industries rose 0.7 percent while FMCG majors ITC and Hindustan Unilever advanced 0.5-0.9 percent.

Shares of Tata Steel, Gail and Hindalco Industries climbed over a percent. However, Tata Motors, M&M, Hero Motocorp, Bajaj Auto, Dr Reddy's Labs, Tata Power and Coal India declined 1-2 percent.

9:55 am Brent price:  Brent crude fell below USD 109 a barrel as Libya restarted an oilfield, on track to drop for an eighth session in what would be its longest losing streak in over four years.

Easing worries over possible disruptions to supply from the conflict in Iraq also dragged on prices. August Brent crude had declined 12 cents to USD 108.82 a barrel by 0318 GMT, down nearly 6 percent from a nine-month high reached in June.

US crude for August delivery was up 3 cents at USD 103.43 a barrel, after Tuesday's settlement marked its longest losing run since December 2009.

The price spread between the two benchmarks is the narrowest in nearly a month.

9:50 am Market check: It does not seem to be over as cautious investors are busy booking profit. The Sensex is down 164.07 points or 0.64 percent at 25418.04, and the Nifty is down 63.10 points or 0.83 percent at 7560.10. About 447 shares have advanced, 1417 shares declined, and 47 shares are unchanged.

Tata Power is down 4 percent while Coal India, Dr Reddy's Labs, Tata Motors and Hero Motocorp are majors laggards in the Sensex. Among the gainers are ITC, GAIL, Infosys, Hindalco and HUL.

9:45 am Market outlook:  Dhirendra Tiwari, Head-Research, Antique Institutional Equities sees no structural problem with the market as the sell-off was observed in sectors and stocks that rallied strongly.

He maintains his bullish stance and advises investors to buy quality cyclicals and IT as export proxies. The market will rally on slightest hint of positive news post Budget, he says in an interview with CNBC-TV18.

He expects PFC and REC to be the biggest beneficiaries of power reforms. Amongst banking stocks, he likes PNB and Yes Bank. With a 1-2 year view, buy Voltas and Cummins India, he adds.

He raises target price of Crompton Greaves to Rs 292 a share and advises buying Eicher Motors with a target price at Rs 12039 a scrip. Besides, he recommends buying ITC at current levels as the company can pass on duty increase.

9:35 am Big bull buy: Ace investor Rakesh Jhunjhunwala today purchased nearly two percent stake in commodity bourse MCX for over Rs 66 crore, as its erstwhile promoter FTIL diluted its holding from 26 percent to 24 percent.

According to information available with the stock exchanges, MCX's erstwhile promoter Financial Technologies (India) Ltd (FTIL) has sold a total of 10.19 lakh shares, amounting to two per cent stake in the commodity bourse. Jhunjhunwala picked up 10 lakh shares of Multi Commodity Exchange (MCX) on an average price of Rs 664 apiece, data showed. This values the transaction at Rs 66.4 crore.

These transactions took place at a time when parleys are being held on for sale of 24 percent stake by Jignesh Shah-promoted FTIL in MCX and the interested bidders include Kotak Group and Reliance Capital. MCX is up 4 percent intraday on Wednesday.

9:25 am Buzzing: Shares of ITC rose 1.5 percent intraday. Credit Suisse has maintained outperform rating on the stock with a target of Rs 400. The brokerage is positive that excise duty hike on cigarettes is unlikely even though investors are nervous due to the Health Minister's demand for a 100 percent-plus hike in cigarette excise.

According to Credit Suisse estimates, if the rise in excise duty is within 20 percent, then ITC is likely to deliver 16-20 percent earnings growth, and the stock will make up its underperformance to other consumer stocks.

At the same time, it warns that if the government goes ahead with a 100 percent excise duty hike, then ITC is likely to see significant de-rating in P/E multiples in the near term.

After the brutal slaughter on Tuesday, the market has opened on a flat note today. The Sensex is up 35.57 points at 25617.68 and the Nifty is up 13.25 points at 7636.45. About 301 shares have advanced, 274 shares declined, and 31 shares are unchanged.

L&T, Coal India, Infosys, Sun Pharma and GAIL are top gainers while Bajaj Auto, HDFC Bank, Axis Bank, M&M and Tata Power are major laggards in the Sensex.

The Indian rupee opened lower, falling by 9 paise to 59.87 a dollar from previous day's closing value of 59.78 a dollar. Pramit Brahmbhatt, Veracity said, "Post the fall in the equity market on Tuesday, investors are waiting cautiously for the declaration of Budget tomorrow." Though the rupee appreciated on Tuesday with the help of FIIs, currency markets will trade cautious today awaiting cues from the Budget.According to him, the rupee is expected to trade in the range of 59.40-60.40/USD today.

Meanwhile, fears of an impending fall after the record breaking rally in equities pulled down global indices further.

Asian stocks were down for third straight session. Japanese shares fell to a new one-week low on the back of a stronger yen. US-China Strategic and Economic Dialogue kicks off in Beijing today. China will speed up economic reforms and allow its currency to strengthen

In the US, stocks skid lower yesterday, extending the prior day's drop from last week's records, as investors braced for quarterly earnings and considered valuations.

Gold prices are steady at USD 1320 an ounce  as investors awaited clearer signs from the US Federal Reserve that it is firmly on track to raise interest rates next year.

Brent crude skids to one-month low, its seventh straight decline as Libyan oil exports looked likely to rise, and fears eased over a supply disruption in Iraq.

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