TODAY’S NEWS HEADLINES (MARCH 8, 2011)

Date: 08 March 2011

Thought for the day

“We must all suffer from one of two pains: the pain of discipline or the pain of regret. The difference is discipline weighs ounces while regret weighs tons.”
-Jim Rohn

GENERAL

1)Lok Sabha approved the rail budget for 2011-12 after railway minister Mamata Banerjee assured the House that efforts would be made to improve services by introducing new coaches and creating better infrastructure.
TOI

ECONOMY

2)Prime Minister’s Economic Advisory Council(PMEAC) chairman C Rangarajan is optimistic on food inflation declining to 7% by end of March. “The easing of food price inflation may not be fully reflected in the March inflation data, but the continued softening of items like vegetables would definitely bring down the overall food inflation,” he said while talking to media at the Madras School of Economics.
FE

3)The government is likely to roll back the budget proposal to levy a service tax on healthcare services after it evoked strong reaction from general public and industry.
ET

CORPORATE / INDUSTRY

4)Mahindra & Mahindra may team up with SsangYong Motor in an attempt to bolster its electric vehicles business as rising fuel prices have triggered growing demand for eco-friendly products.
ET

5)Bharat Heavy Electricals(Bhel) has bagged an order worth Rs 1,445 crore for a 600 MW thermal power project in Andhra Pradesh. The contract has been awarded by Andhra Pradesh Power Generation Corporation(APGenco).
FE

6)United Phosphorus (UPL) a leading producer of crop protection and specialty chemicals, has acquired 50 per cent stake in Sipcam Isagro Brazil (SIB) from Isagro SpA for an undisclosed sum.
BL

MONEY & BANKING

7)The rupee gained in intra-day trade though it ended the day lower than the previous close. The domestic currency was weak initially as it tracked the stock markets and the euro. But it recovered towards the end of the day as both the Sensex and the euro gained. The rupee opened at 45.12 and closed at 45.05, against Friday’s close of 44.98.
BL

8)The Reserve Bank of India aims to revamp regulations for non-banking finance companies(NBFCs) for the first time in 15 years, an industry which reaches out to the remote parts of the country that banks don’t .
ET

9)SEBI has permitted the launch of futures contracts on 91-day treasury bills(T-Bills) with immediate effect. The instrument will be traded on the currency derivatives segment of stock exchanges. Exchanges have been advised to introduce these contracts after permission from SEBI.

BL

INSURANCE

10)Insurance Regulatory and Development Authority, or Irda, plans to permit insurers to trade in equity futures and options contracts, which will help these companies protect returns from equity-linked products against sharp declines in the stock markets.
ET

11)All three unit-linked plans (Ulips) launched by Life Insurance Corporation (LIC) since September have shown robust growth. That has given the company an edge over competitors, which, in sharp contrast, have seen a dip in their Ulips portfolio since the Insurance Regulatory and Development Authority came out with stricter regulation governing these instruments six months ago.
BS

12)SBI Life Insurance on Monday launched Smart Wealth Assure, a unit-linked plan providing fixed returns according to the new Insurance Regulatory Development Authority guidelines. A single-premium plan, it guarantees a pre-specified NAV, applicable at the end of the 10-year term. Available at a minimum amount of Rs 50,000, the plan can be availed of between 8 and 65 years of age, with a policy term of 10 to 30 years. The maturity age is up to 75 years.
BS

MARKETS

13)Shares closed lower in light trade on Monday as investors fretted about the stability of the ruling coalition after a key member withdrew from the Centre over the weekend. The weakness in investor sentiment was exacerbated by soaring crude prices amid intensifying tensions in the MiddleEast and North Africa, which spurred selling in rate-sensitive auto, banking and real estate sectors. The Bombay Stock Exchange’s Sensitive Index fell 263.78 points, or 1.4 per cent, to close at 18,222.67 after moving between 18,058.71 and 18,361.65. On the National Stock Exchange, the 50-stock S&P CNX Nifty slipped 75.60 points, or 1.4 per cent, to end at 5,463.15.
BL

14)Shares of domestic airline companies took another hit today, as continuous political turmoil in Libya pushed crude oil prices further up. With reports suggesting crude might go as high as $200 a barrel, airline stocks were struck in today’s trading session and inched closer to their 52-week low.
BS

15)While the Indian equity market may continue to experience a negative impact of higher crude oil prices, it is likely to see a bounce in the second half of the year says Deutsche Bank. In its 2011 India economic and market outlook, the bank set a yearend target of 21,000 for Sensex and said that in near term crude oil prices and higher inflation continue to remain the headwinds for the market.
FE

IPO

16)Six top investment banks which managed the Coal India initial public offering have been barred from hiring some retail brokers for any share sale till 12,000 investors deprived of shares in the IPO due to technical glitches were compensated, potentially stalling any new offer.
ET

17)PTC Financial Services (PFS), a non-banking financial institution promoted by Power Trading Corporation (PTC), is in the process of accessing capital market with an IPO.
FE

MUTUAL FUNDS

18)Mutual fund industry body the Association of Mutual Funds in India, or AMFI, has named HDFC Asset Management Company Managing Director Milind Barve as its new chairman, a position which fell vacant after incumbent UK Sinha became chief of market regulator Sebi. AMFI has also named Sundeep Sikka, CEO of Anil Ambani group’s mutual fund arm Reliance Capital Asset Management,as its new vice-chairman.
ET

19)FIXED Maturity Plans (FMPs) which are attracting huge inflows in the last few months, might once again be able to declare indicative yields (returns), at least in a range, if market regulator Securities and Exchange Board of India(Sebi) gives the go ahead. Mutual Fund industry body, Association of Mutual Funds in India(Amfi) plans to take up the matter with new Sebi chief, UK Sinha.
FE

COMMODITIES

20)US crude rose more than $2 to a 30-month high above $106 on Monday as civil war brewed in Libya, while investors kept a close eye on top exporter Saudi Arabia, home to most of Opec’s spare capacity and where clerics at the weekend warned against protests.
FE

21)Gold climbed, approaching a record, as unrest spreads in West Asia, driving demand for precious metals. Silver reached a 31-year peak. Immediate-delivery bullion gained 0.5% to 1,437.85 an ounce at 2:07 pm Singapore time. Silver was steady after rising as high as $36.38 an ounce, partly driven by data showing a rebound in US jobs.
FE

22)Silver rose to near Rs 55,000 a kg on the bullion market on Monday on buying for the ongoing marriage season and rates in the global market crossing $36 a pound. Gold, too, gained as global prices soared on Libyan unrest.
BL

23)Turmeric prices have remained buoyant despite an increase in supplies due to the higher export demand. Supplies rose in the main markets of Erode and Nizamabad which opened on Monday after Shivaratri holidays.
ET

REAL ESTATE

24)Tata Realty and Infrastructure(TRIL) and Tata Realty Initiatives Fund 1 (TRIF 1) on Monday acquired Peepul Tree Properties from Kotak India Real Estate Fund 1 for Rs 525 crore ($117 million).
FE

INFORMATION TECHNOLOGY

25)Visa restrictions are beginning to hurt growth prospects of Indian tech firms with the number of rejections having doubled in the past few months. A recent visa abuse case filed by an Infosys employee in the US could trigger a bigger debate
even as companies complain of increased fees, higher rejection rates, difficulties in getting interview appointments and excessive requests for evidence.
ET

INTERNATIONAL

26)France’s LVMH will take over Bulgari in a deal that values the Italian jeweller at e3.7 billion and gives the No. 1 luxury group more clout in the sector and bigger exposure to emerging markets.
ET

27)THE London Stock Exchange is eyeing a takeover of its American rival Nasdaq just weeks after announcing a merger with the Toronto Stock Exchange, the Sunday Times reported.
FE

Today’s Levels (08-03-2011)

Today’s Levels

(Last Close : Sensex 18223 : Nifty Spot 5463)

Trade long if Sensex sustains above 18124 (Nifty 5427)

[Upside targets/resistances at 18185(5454)/18305(5484) or higher]

Trade short if Sensex fails to sustain above 18185 (Nifty 5454)

[Downside targets/supports at 18124(5427)/18059(5408) or lower

For the Day (08-03-2011)

For the Day: The indices are expected to open on a flat note in response to the mixed global cues. Trade short in Nifty below 5480, else from 5500 with a stop loss of 5520 targeting 5450-5420 levels. Alternatively, trade long in Nifty if it holds 5400 levels with stop loss placed at 5380 targeting higher levels.