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Indian stock market morning report by Keynote Capitals (May 25, 2009, Monday, 7.00 a.m. GMT)

Views on markets today
- Indian markets were up on Friday on fresh buying in capital goods and banks stocks. Oil and gas and pharma stocks also witnessed some buying.
- Market breadth was fairly strong at 3x. FIIs were net sellers of Rs762Cr and domestic institutions were net buyers of Rs435Cr.
- Deliverable volumes for the top 10 traded stocks on NSE and BSE were strong at 26.1% and 19.6% respectively, indicating increased investor interest. Reliance Industries and L&T witnessed strong deliverable volumes while HDIL and Reliance Capital traded on weak deliverable volumes.
- Asian markets are mixed today. The Nikkei is up on hopes that the economy is bottoming out, which may be confirmed by the economic report to be released by the government today. The Hang Seng witnessed selling pressure and is lowered by over 1%.
- Indian markets may see positive opening as the government announced its new cabinet. However, markets may remain volatile on the cues from global markets.

Economic and Corporate Developments
- The Indian Rupee (INR) weakened to 47.35/42 per USD this morning, compared to Friday's close of 47.11/12.
- NYMEX Crude Oil (CL) is currently trading at $61.40 per barrel.
- The Petroleum Ministry proposes reduction in customs duty on denatured alcohol and molasses in order to stabilise the 5% ethanol-blending programme in petrol (EBP).
- According to Assocham, the entertainment industry in India has been growing at a healthy 39% for the last three years on the back of increasing number of TV channels and films.

Buzzing Stocks
- The promoters of wind turbine maker Suzlon Energy are reportedly selling about $120mn worth of existing shares at a discount of up to 3% to the Friday closing price, according to a term sheet. The sellers were offering up to 60mn shares, or 4% stake in the company, at Rs91.20 - 94 each.
- Reliance Infrastructure plans to raise Rs43bn through issuance of 4.29Cr equity shares to its promoters group, which would increase the promoters' holding in the company to 48%.
- Areva T&D wins order worth Rs 1.1bn from West Bengal State Electricity Transmission Company. The order is expected to be executed in about 30 months.

Results to be announced today
Jet Airways, Karnataka Bank, Electrotherm India

US markets last Friday

The US markets last Friday ended the pre-Memorial day week lower 0.2% after trading in positive territory for most of the day. Worries about a possible downgrade of the US credit rating left the market on rocky ground ahead of the Memorial Day weekend. Stocks strong earnings out of retail giant, Sears lifted consumer retail shares but 10 year T-Bills fell sharply on credit concerns. Financials lagged the broader market and ended 1.2% lower, worse than any other major sector. Banks were the primary drag on the financial sector. In the end, six of the 10 sectors advanced. The Senate passed a bill increasing restrictions on the credit card industry, which was subsequently signed into law by President Obama.

The US stock and bond markets are closed today in observance of Memorial Day.