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Indian stock market daily morning report (November 16, 2009, Monday)

Contributed by Keynote Capitals

By Nitin A.Khandkar (Keynote Capitals)

Views on markets today

- In a volatile trading session, after opening slightly positive, the Sensex managed to end Friday’s session with around 1% upside led by metal, IT and auto stocks. Real estate and consumer durables stocks were underperformers.

- Recovery in the GDP of Eurozone (16 European countries) fueled the rally in most of the European markets which in turn pushed the Sensex up. Data shows these countries grew 0.4% in Q3CY09.

- The small rally was however not supported by volumes. NSE volumes in fact dropped significantly compared to the recent average of Rs18,000Cr. The increase in deliverable volumes on BSE was due to Satyam Computer.

- Market breadth was tight at 1x. Institutional turnover trend was mixed; while FIIs bought equities worth Rs471Cr, domestic institutions sold equities of Rs25Cr.

- Asian markets are up today as a series of positive developments boosted investor confidence. After a strong recovery of the Eurozone economies, Japan's GDP grew by 1.2% for Q3CY09, the fastest in the last 2 years.

- We expect a positive opening for the Indian markets today in line with the Asian markets. FII buying is a major positive.

Buzzing Stocks

- Aditya Birla Group has approved a proposal to merge UltraTech Cement and Samruddhi Cement, a whollyowned subsidiary of Grasim Industries to consolidate the group’s cement business that currently accounts for a fifth of the Indian cement market.

- Tata Motors will be in focus on a media report that its unit Jaguar Land Rover has obtained funding for working capital. JLR has secured a ?170mn working capital facility from GE Capital.

- South Korea's TV shopping channel, GS Shopping is set to buy a 15% stake in TV18 HSN Holdings for $18.5mn, to break into the market. The Indian company is a holding company of TV18 Home Shopping Network, a TV shopping channel.

- KSK Energy Ventures has priced its proposed Rs515.92Cr QIP issue @ Rs194.50 per share.

- QIP of Aban Offshore has opened from November 13.

- Glenmark Generics has received ANDA approval from US-FDA for Ciclopirox Olamine Cream.

US markets

Supported by weak volumes, the US markets rose Friday, recording the 2nd straight weekly gains as upbeat retail news reinforced hopes for strong sales in the key holiday season. The Dow Jones industrial average rose 0.72% the Nasdaq 0.88%. Consumer shares led the rally, following results from Walt Disney Co and retailer Abercrombie & Fitch, and an optimistic view from JC Penney Co Inc.

The S&P consumer discretionary sector rose 1.6% even as the Reuters/University of Michigan preliminary November Surveys of Consumers showed US consumer confidence fell to its weakest level in three months amid grim expectations for job and income prospects. Disney shares rose 4.8% after it posted a larger-than-expected rise in both quarterly profit and revenue, as strong results from its cable business helped it overcome a disappointing stretch for its film studio. JC Penney said earnings for the holiday quarter could beat estimates, while clothing retailer Abercrombie & Fitch reported better-than-expected results, and their stocks led retailer shares higher.