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Flat Closing || Lower IIP Numbers || Reality Leads || Strong Recovery
It was a weak day for global markets, as expected our market also opened lower as US auto bailout package was vetoed out in the Senate and huge sell-off followed in the US dollar against the euro, pound and the yen. 30 share benchmark index Sensex opened with a loss of 274.59 points, at 9,370.87 and touched the intraday low of 9,281.89 falling 408.18 points on relentless selling pressure amid high volatility. During the trading time IIP data released the October Index of Industrial Production, or IIP, number stood at a negative 0.4% as compared to 4.8% month-on-month and 12.22% year-on-year. But with negative IIP numbers market showed strong optimism thereafter and the Sensex witnessed a sharp turn-around as gains in heavyweight, reality, oil and consumer durable stocks propelled it to an intra-day high of 9,746 this help sensex to swing more than 4% in the trading time from days to intraday high. In the last leg of trading market became very choppy and traded between negative and positive for maximum side. But at the end it finishes the day on positive side with a flat closing. The benchmark BSE Sensex ended the day with a gain of 44.61 points or 0.46% at 9,690.07 after touching a high of 9,745.51 and a low of 9,281.89. The broad-based NSE Nifty climbed 1.20 points or 0.04% at 2,921.35 after hitting a high of 2,936.80 and a low of 2,812.55. BSE Midcap and Small cap index rose 1.58% and 2.54% respectively.
Sectoral: Majority of sectoral indices ended in green, out of 13 sectoral indices 8 ended on green and reaming 5 closed on negative zone. BSE Realty and Consumer Durable (CD) indices were the top gainers among the sectoral indices, up 3.94% and 2.93% respectively, while IT and Teck indices were the top losers, down 2.88% and 1.7% respectively. On stocks, side DLF and Reliance Infra were the top gainers among the sensex stocks, gaining 7.73% and 7.25% respectively, while TCS and Wipro were the top losers, shedding 5% and 4.52% respectively.
IIP Data: The October IIP number came in at 0.4% as against 4.8% for the previous month and Bloomberg expectation of 2.1%. This was the first time in last 15 years (last lowest figure of Industrial output is in April 1993), that Industrial production recorded a negative growth. A CNBC-TV18 poll conducted earlier had estimated the October IIP number below 2%. This was largely based on a slowdown in auto sales and lack of buying during the festive season. The September IIP number was revised to 5.4% as against 4.8% earlier. Manufacturing, comprising around 80 per cent of the Index of Industrial Production, clocked a negative 1.2 per cent growth in the month from a whopping 13.8 per cent a year ago. In fact, output in two of the four sectors that make up the index -- intermediate goods and consumer goods -- contracted to 3.7 per cent and 2.3 per cent, respectively, from a growth of 13.9 per cent and 13.7 per cent, respectively. Within consumer durable goods, both segments -- consumer durables and consumer non-durables -- shrank by three per cent and two per cent, respectively. Of the total 17 industries, captured in the IIP figure, as many as 10 recorded a negative growth and could have a similar bearing on economic growth, given the fact that industry accounts for 29.4 per cent of GDP. Commerce Secretary G K Pillai said November too might see IIP numbers falling further. (Figures are taken from Indian Express)
Crude & Currency : Indian Rupee ended at Rs. 48.715 against US Dollar on Friday. Crude ended lower on Friday, but off their intraday lows, as the Treasury Department of US govt. said it would lend funds to the auto industry after a rescue plan collapsed in the Senate on Thursday night. Crude oil for January delivery fell $1.70 to end at $46.28 a barrel on the NYMEX.
Asian Markets : Asian market collapsed and put resume on five-day rally by the region`s benchmark index on the news of US Senate didn’t passed the USD $14 bln bailout plan for Auto Makers. It was all around red in the region. It was the only Indian market which closed in Green and recovered from lows (nearly 5% from day lows). All major Asian indices closed near about their intraday lows. Japan Nikkei 225 index closed at 8,235.87 shedding 484.68 points or with a cut of 5.56%. The same story was with Hang Seng it closed at 14,758.39 with a cut of 855.51 points or 5.48%.
European Market : The intensity of fall was not like as Asian market but euro range also slips around 3% and closed in all in red. London FTSE 100 index closed negative at 4,280.35 with a cut of 108.34 points or 2.47%. German based DAX index closed at 4,663.37 shedding 103.83 points or 2.18%. CAC 40 index closed in red at 3,213.60 with a cut of 92.53 points or 2.80%. However Euro markets managed to closed around their intraday high. But didn’t able to trade in positive side during the session. But US auto majors stocks fallen terribly in euro markets, Ford tumbled 14% and General Motors fell 30% in Europe.
American Markets: US major indices opened lower on rejection of auto bailout plan. Senate denies the additional help of $14bln for auto makers. As the amount asked by the auto makers was USD $31 bln but Bush administration agreed for $14 bln to help troubled Auto Makers but senate didn’t passed this and asked the administration to help automakers from that $700 bln package which was prepared for financial companies to help them to recover from those toxic investment. But as the news came, govt. will help auto makers on its own level as they are unwilling to see automakers fail, market rejoins the ride and close in positive side, all major indices in US closed in green and towards intraday higher level. Dow Jones closed at 8,629.68 adding 64.59 points or 0.75%. Tech based NASDAQ closed at 1,540.72 gaining 32.84 points or 2.18%. S&P 500 closed at 879.73 with a gain of 6.14 points or 0.70%.
Sectoral: Majority of sectoral indices ended in green, out of 13 sectoral indices 8 ended on green and reaming 5 closed on negative zone. BSE Realty and Consumer Durable (CD) indices were the top gainers among the sectoral indices, up 3.94% and 2.93% respectively, while IT and Teck indices were the top losers, down 2.88% and 1.7% respectively. On stocks, side DLF and Reliance Infra were the top gainers among the sensex stocks, gaining 7.73% and 7.25% respectively, while TCS and Wipro were the top losers, shedding 5% and 4.52% respectively.
IIP Data: The October IIP number came in at 0.4% as against 4.8% for the previous month and Bloomberg expectation of 2.1%. This was the first time in last 15 years (last lowest figure of Industrial output is in April 1993), that Industrial production recorded a negative growth. A CNBC-TV18 poll conducted earlier had estimated the October IIP number below 2%. This was largely based on a slowdown in auto sales and lack of buying during the festive season. The September IIP number was revised to 5.4% as against 4.8% earlier. Manufacturing, comprising around 80 per cent of the Index of Industrial Production, clocked a negative 1.2 per cent growth in the month from a whopping 13.8 per cent a year ago. In fact, output in two of the four sectors that make up the index -- intermediate goods and consumer goods -- contracted to 3.7 per cent and 2.3 per cent, respectively, from a growth of 13.9 per cent and 13.7 per cent, respectively. Within consumer durable goods, both segments -- consumer durables and consumer non-durables -- shrank by three per cent and two per cent, respectively. Of the total 17 industries, captured in the IIP figure, as many as 10 recorded a negative growth and could have a similar bearing on economic growth, given the fact that industry accounts for 29.4 per cent of GDP. Commerce Secretary G K Pillai said November too might see IIP numbers falling further. (Figures are taken from Indian Express)
Crude & Currency : Indian Rupee ended at Rs. 48.715 against US Dollar on Friday. Crude ended lower on Friday, but off their intraday lows, as the Treasury Department of US govt. said it would lend funds to the auto industry after a rescue plan collapsed in the Senate on Thursday night. Crude oil for January delivery fell $1.70 to end at $46.28 a barrel on the NYMEX.
Asian Markets : Asian market collapsed and put resume on five-day rally by the region`s benchmark index on the news of US Senate didn’t passed the USD $14 bln bailout plan for Auto Makers. It was all around red in the region. It was the only Indian market which closed in Green and recovered from lows (nearly 5% from day lows). All major Asian indices closed near about their intraday lows. Japan Nikkei 225 index closed at 8,235.87 shedding 484.68 points or with a cut of 5.56%. The same story was with Hang Seng it closed at 14,758.39 with a cut of 855.51 points or 5.48%.
European Market : The intensity of fall was not like as Asian market but euro range also slips around 3% and closed in all in red. London FTSE 100 index closed negative at 4,280.35 with a cut of 108.34 points or 2.47%. German based DAX index closed at 4,663.37 shedding 103.83 points or 2.18%. CAC 40 index closed in red at 3,213.60 with a cut of 92.53 points or 2.80%. However Euro markets managed to closed around their intraday high. But didn’t able to trade in positive side during the session. But US auto majors stocks fallen terribly in euro markets, Ford tumbled 14% and General Motors fell 30% in Europe.
American Markets: US major indices opened lower on rejection of auto bailout plan. Senate denies the additional help of $14bln for auto makers. As the amount asked by the auto makers was USD $31 bln but Bush administration agreed for $14 bln to help troubled Auto Makers but senate didn’t passed this and asked the administration to help automakers from that $700 bln package which was prepared for financial companies to help them to recover from those toxic investment. But as the news came, govt. will help auto makers on its own level as they are unwilling to see automakers fail, market rejoins the ride and close in positive side, all major indices in US closed in green and towards intraday higher level. Dow Jones closed at 8,629.68 adding 64.59 points or 0.75%. Tech based NASDAQ closed at 1,540.72 gaining 32.84 points or 2.18%. S&P 500 closed at 879.73 with a gain of 6.14 points or 0.70%.
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