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Indian stock market daily morning report (August 31, 2012, Friday)

Contributed by Keynote Capitals

Views on markets today

- Indian markets snap four-day losing streak and closed on positive note yesterday as lenders like ICICI Bank rose after steep recent falls, although caution still prevailed ahead of key economic growth data. Investors will however scrutinise April-June gross domestic product data out, given concerns that India's economy is slowing sharply even as inflationary pressures remain, making the prospect of monetary action uncertain. A Reuters poll of 38 economists forecast growth of 5.3 percent for the April-June quarter, unchanged from January-March quarter and marking its slowest growth since 2009.Volatility was high as traders rolled over positions in the futures & options (F&O) segment from the near-month August 2012 series to September 2012 series.

- FMCG stocks rose on revival of monsoon rains this month. Hindustan Unilever and ITC hit record high. Pharma stocks extended their recent gains.

- Hero MotoCorp fell 1.4% after Credit Suisse downgraded the stock to "neutral" from "overweight", citing caution about the company's near-term outlook in the domestic two-wheeler market. Tech Mahindra slumped 5% after British telecoms firm BT unloaded about a 5% stake in the Indian IT service provider. Tata Steel fell 2.3% while Jindal Steel and Power fell 1.9%, extending recent sharp declines on continued worries about the fallout from the controversial coal concessions that has consumed parliament.

- Market breadth was marginally positive negative at ~1.06x as investors bought large cap stocks. On provisional basis, FIIs bought equity of '23.06bn while domestic institutions sold equity of '3.28bn in cash segment.

- Asian stocks fell sharply, after weak US markets overnight as the investors kept their closed watch on Federal Reserve Chairman Ben Bernanke's speech.

- We expect a weak opening for the Indian markets, following the cues from the Asian markets and declining prices of commodities.

Economic and Corporate Developments

- Government signed production sharing pacts for four blocks under NELP-IX. Oil India, ONGC among companies in NELP-IX production sharing pact. The government has Signed 18 production sharing pacts under NELP-IX so far.

Buzzing Stocks

- Lanco Infra in talks with PEs to raise upto USD 750 mn

- NTPC has slashed investments by Rs 50,000 crore due to coal supply uncertainty

- SAIL moves Competition Appellate Tribunal (COMPAT) against JSPL petition on CCI ruling

- Telecom Disputes Settlement and Appellate Tribunal (TDSAT) allows Airtel 's plea against TTSL claiming dues of Rs 287 crore

- RCF to invest Rs 4000 crore over next three years to ramp up urea capacity at Thal plant near Mumbai

- Koutons Retail board meets today to consider & discuss preferential issue /ADR /GDR

- EIH Associated Hotels board to meet today for considering rights issue

- Aarti Industries board approves demerger of manufacturing business undertaking

- Essar Oil, Cafe Coffee Day in marketing tie-up (CCD to open Coffee shops at Essar Oil Fuel stations)

- Religare Finvest ups stake in Hindustan Tin Works by 2.41% to 14.09%

- Reliance Industries (RIL) submits new plan for tow gas discoveries in KG basin