Markets For You

GLOBAL INDICES

• At 9.00 am in the morning, Asian markets were trading mixed, with Nikkei trading 0.24% down and Hang Seng trading 0.76% higher.
• Nikkei fell on Monday on concerns of potential power shortages, after Japan's PM
called for the closure of in Chubu Electric due to worries that a large earthquake could trigger another nuclear crisis.
• Hang Seng index ended higher on Monday helped by stablizing global crude prices, though gains got capped on concern over key economic data due from
China.
• FTSE index fell on Monday as energy group Centrica PLC lowered its earnings forecast and after HSBC Holdings reported a lower underlying first-quarter profit.
• Dow Jones rose on Monday as recovery in commodity prices helped to lift the stocks of energy and materials companies.

INDIAN EQUITY MARKET

• At 9.00 am in the morning, the SGX Nifty was trading 0.04% higher.
• Indian stock indices ended volatile session flat on Monday as investors kept position light due to sharp recovery in the prices of crude oil.
• Shares of oil retailers declined on worries over rising under-recoveries of the companies on retail fuel sale with HPCL, IOC and BPCL falling 1-3%.
• Auto and banking stocks were the worst hit due to profit booking with Maruti Suzuki, Tata Motors, Bajaj Auto, Axis Bank and PNB ending down around 2% each.
• HUL gained 3% after the company posted better than expected Jan-Mar net profit.
• Eicher Motors shares surged 12% as the company's Jan-Mar consolidated net profit rose 82%.
• Piramal Healthcare shares ended nearly 9% down on the company's decision to enter the financial services sector.
• Jyothy Lab declined 4% on concerns the acquisition of loss-making Henkel India may weigh on the balance sheet of the company.

DOMESTIC NEWS

• IMF hails moves by India's central bank to hike interest rates in an attempt to curb
the rising cost of living.
• OECD says that India's economy is likely to lose pace even as China and the US are expected to see good expansion in the coming months.
• Government sets a target to raise Rs.40000 cr through disinvestment in FY12.
• RBI Governor says that it is unrealistic to expect the central bank to deliver on an
inflation target in the short-term given that the drivers of inflation largely emanate
from supply-side.
• An EPFO official says it would not be possible to retain the 9.5% rate paid for 2010-11, this year.
• India's domestic passenger car sales growth moderated to 13.2% on year to 162,825 vehicles in April, the slowest in 2 years, and 16.2% lower than the 194,199 units sold a month ago.
• Assocham urges government not to levy the proposed 5% countervailing duty (CVD) on coal as it may impact power tariff.
• SAIL asks its subsidiary, Maharashtra Elektrosmelt, to raise ferro-alloys production in line with the growing requirement of SAIL's steel plants.
• According to SEBI, Corporate India raised Rs.67608.5cr through 91 issues in 2010-11, as against Rs.57555.1cr through 76 issues in 2009-10.
• US-based iGate Corp increases its shareholding in Patni Computer to 81.29% by acquiring 20% more stake in the company through an open offer.
• Jyothy Labs offers to acquire up to 20% more stake in Henkel India in an open offer at Rs.41.20 per share.
• CRISIL says the microfinance institutions sector is likely to see consolidation over the medium term, since small players may find it difficult to operate in a strict regulatory environment.

DERIVATIVES MARKET

• Nifty May futures (near future) closed up against the spot index with around 8 point premium; it however witnessed 0.39 mn decrease in open interest (OI).
• Put Call Ratio (OI) rose to 0.97 on May 9 from 0.94 on May 6.
• Nifty 6000 May Call strike continued to witness the highest OI.
• Nifty 5500 May Put strike witnessed the highest OI.
• India VIX (volatility index based on the Nifty 50 Index Option prices) rose to 21.50% on May 9 from 20.97% on May 6.

INDIAN DEBT MARKET

• Call rates ended at 7.40-7.50% on Monday as banks borrowed funds to cover their cash reserve requirements for the new Reporting Fortnight in the first week itself.
• Banks borrowed Rs.64305 cr from RBI’s repo window vs Rs.29245 cr on Friday.
• The RBI has discontinued the second set of daily LAF auctions.
• Banks can now also borrow from the Marginal Standing Facility, introduced by the RBI to help banks meet their fund needs when liquidity is tight.
• Gilt yields rose sharply on Monday as the recovery in crude oil worsened sentiment ahead of a likely hike in local fuel prices, which is expected to push inflation higher.
• The benchmark 7.80%, 2021 bond ended at Rs.96.90 or 8.2624% yield, down from Rs.97.48 or 8.1741% yield on Friday.
• Local oil marketing companies have been mulling a fuel price hike as the relentless surge in global crude prices was resulting in huge revenue losses.
• After market hours, RBI announced the auction of 7.83%, 2018 paper worth Rs.4000 cr; 7.80%, 2021 paper worth Rs.5000 cr and 8.30%, 2040 paper worth Rs.3000 cr on May 13.

Currency Overview

• The Indian rupee rose against the US dollar on Monday as a slight rise in the euro and expectation of robust dollar inflows in Power Finance Corp’s FPO prompted dollar sales; sporadic dollar sales by exporters also supported the rupee's rise.
• But persistent dollar demand from oil importers weighed on the rupee.

Commodity Overview

• Crude oil prices rose $5.37 to settle at $102.55 a barrel on the NYMEX on news that the CME Group is raising the margin requirement for a wide variety of crude-oil contracts.
• Gold prices rose as some weakness in the U.S. dollar and concerns over European debt woes lured investors back to it.

INTERNATIONAL NEWS

• US Treasury Secretary says that China was making progress but needed to change its economic growth model.
• European Union is looking to lower interest rates on bailout loans to Greece and Ireland and is working on a second rescue for Athens in an effort to prevent a disorderly debt restructuring.
• S&P cut Greece's rating to B from BB- over concerns that a debt restructuring is increasingly likely.
• Bank of China receives regulatory approval to issue up to 32bn yuan of subordinate debt to improve its capital structure.