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Indian stock market morning report by Keynote Capitals (June 4, 2009, Thursday, 7.00 a.m. GMT)

Views on markets today

- Amid high volatility and lack of direction, the Sensex closed moderately negative yesterday. FIIs and domestic institutions both were buyers yesterday of Rs33Cr and Rs53Cr respectively. Bank, IT and oil and gas stocks were weak while FMCG, consumer durables and pharma stocks witnessed buying.

- Market breadth was strong at 2.6x, led by upmoves in mid and small cap stocks.

- Asian markets are weak today on weak overnight close of the US markets. Sentiments were dampened by weak US jobs and mortgage data. Shipping stocks witnessed profit taking and were a drag the markets.

- Indian markets may open weak today following cues from the global markets. The markets seem to be directionless and may remain volatile in the near future. Inflation data is to be announced today. Though, it is under control the RBI is still taking conservative approach of not cutting interest rates. In our view, an interest rate cut can be a major trigger for the markets.

Economic and Corporate Developments

- The Indian Rupee (INR) weakened this morning to 47.23/24 per USD, lower than previous close of 47.07/08.

- NYMEX Crude Oil (CL) is currently trading at $66.32 per barrel.

- India's exports in the first half of FY10 is expected to be down around 20% y-o-y, as per the president of Federation of Indian Exporters' Organisation (FIEO).

- QIP: GVK Power & Infrastructure will raise upto Rs25bn via a QIP to meet the funding requirements for its various ongoing projects.

Buzzing Stocks

- Suzlon Energy is convening a meeting of FCCB holders on 25th June, 2009, proposing certain amendments to the terms and conditions of the Bonds. The total principal amount of the FCCBs outstanding is $121.4mn.

- BHEL has bagged a Rs3.75bn order for 2 gas turbine generating units for a project in Oman.

- ONGC will go ahead with ultra deep drilling, and has hired Reliance’s deepwater drill ship DD-KG1 for four years at $510,000 a day.

- Jaihind Projects in consortium has received orders worth Rs230.81Cr from Gujarat.

Results to be announced today
GMR Infra, Sundram Fasteners

US markets

US markets tumbled overnight after over 3% decline in the oil prices and weak job market and mortgage data. The markets halted 4 day rally and saw some profit taking as well.

Jobs data shows that over half a million jobs lost in last month.

Service sector jobs contracted sharply for the eighth consecutive month.

Oil and energy stocks fall after a sharp overnight decline in oil prices. Oil declined after the government data showed a suprise build up of inventories.