Thursday, 13 March, 2008

Mkts witnessed panic selling due to global uncertainty

Markets witnessed panic selling due to increasing global uncertainty. Today was the lowest Sensex closing level since Aug 31, 2007 and lowest Nifty closing level since Sep 18, 2007. Sensex ends down 771 points at 15357 while Nifty ends down 248 points at 4623. CNX Midcap Index ends down 5.7% while BSE Small cap Index ends down 5.3%. BSE Realty Index was down 11.6%, in which Unitech was down 9.7% and DLF was down 14.9%. BSE Metals Index was down 8.4%, in which SAIL was down 10.8%, Tata Steel was down 9.4%, Hindalco was down 9.3% and Sterlite was down 7.4%. BSE Oil & Gas Index was down 5.8%, in which Cairn was down 12%, RPL was down 6.9%, Reliance was down 5.5% and ONGC was down 2.7%. BSE Capital Goods Index was down 5.6%, in which BHEL was down 6.5%, Siemens was down 5.8% and L&T was down 4.6%. BSE Bank Index was down 5.6%, in which SBI was down 6.2%, HDFC Bank was down 5.2% and PNB was down 4.1%. Only Hero Honda and Bajaj Auto were among the index stocks which ended in green.

Non Index losers were Indiabulls Finance, down 16.2%, Power Grid, down 13.7%, Indiabulls Real Estate, down 12.9%, Nagarjuna Fertilizers, down 12.8%, HDIL, down 12.6%, Reliance Capital, down 12.3%, Educomp, down 12.2%. V-Guard lists at Rs 84 vs issue price of Rs 82 and closes at Rs 76. NSE Advance Decline ratio stood at 1:16. Total turnover was at Rs 64,578 crore Vs Rs 67,412 crore.

F&O snapshot:

Nifty March Ends day at 15 point discount. Nifty March continues short buildup and added 37.8 lakh shares discount ranges between 10-25 points. F&O space sell off on relatively low volumes; high impact cost causes sell off on low Open interest change in most stocks. Power Grid and DLF witnessed major open interest buildup in the last half hour of trade a day before their Nifty inclusion. Power Grid was down 13.8%; added 1.04 crore shares, DLF was down 15%; added 41.9 lakh shares. Only 4 F&O stocks ended in the green. Index arbitrage positions were part of the reason. F&O stocks which saw OI buildup at the beginning of the week give up those gains. NSE F&O turnover was at Rs 44869.5 crore vs Rs 44632.8 crore.

Other Short buildup:

RNRL: down 12%; added 21.5 lakh shares
Hindalco: down 9.7%; added 9.4 lakh shares
Wipro: down 7.4%; added 6.22 lakh shares
NTPC: down 4%; added 5.72 lakh shares
Satyam Computers: down 5.4%; added 5.65 lakh shares
Bajaj Hindustan: down 7.1%; added 5.52 lakh shares
Reliance Communication: down 8%; added 5.15 lakh shares
Unitech: down 11%; added 4.78 lakh shares
Essar Oil: down 12%; added 4.53 lakh shares
Cairn India: down 11%; added 3.9 lakh shares

Long Unwinding was seen in Nagarjuna Fertilizers, MTNL, Ispat, Balrampur Chini, Oswal Chemicals, Dena Bank, JP Associates, MRPL.

Asia today:

Asian markets slide on renewed concerns of US recession, reports of hedfe fund liquidations, liqudation of Carlyle Capital. Hang Seng was down 4.8%, Jakarta was down 4.5%, Straits Times was down 3.85% and Nikkei was down 3.3%.

Wall Street Worries:

Rumors that Wall Street fears a big US bank is in trouble. At least a dozen hedge funds have closed, sold assets or sought fresh capital in the past month. Reports of hedge funds liquidating their global funds; Drake may shut its largest hedge fund worth $ 3 billion. GO Capital Asset Management blocked clients from withdrawing cash from its $ 880 million Global Opportunities Fund. Possible liqudation of Carlyle Capital; co having $ 16 billion in mortgage-backed securities is expecting creditors to seize all of its remaining assets after unsuccessful negotiations to prevent its liquidation.

Data To Watch Today (Thursday):

US Retail Sales (Consumer spending accounts for 2/3rd of GDP and is therefore a key element in economic growth).
US Jobless Claims (No of individuals who filed for unemployment insurance for the 1st time).
US Business Inventory.

Data to watch tomorrow (Friday):
Bear Sterns Q4
Lehman Brothers Q4
Ben Bernanke is speaking
U.S. CPI Data