Sensex Edges Lower, Motilal IPO Surges

123jump.com Staff
11 Sep, 2007
New York City

Sensex in Mumbai traded sidways after a week of declines. Ministry of Power has asked the government to allow local utiliies to borrow in the international markets. Jindal Steel & Power jumped 5% after the Bolivian Senate approved the joint venture between the government and the company. Blue Dart Express added 3% after the company plan to spend 1,000 crore rupees to add fleet of cargo planes. Relinace Industries reached a new intra0day high of 2,007 rupees.

[R]10:00AM New York - 7:30PM Mumbai – Power Ministry is looking for ways to allow utilities companies to borrow in the international markets. Motilal Oswal IPO jumped 19%.[/R]

Sensex in Mumbai trading lost 54 or 0.35% to close at 15,542.77. CNX Nifty fell 10.8 or 0.24% to close at 4,497.05. Rupee recovered to 40.60 against dollar from 40.65 in Friday trading.

Of the stocks trading on BSE, 1,410 gained, 1,356 declined, and 65 closed unchanged. Daily turnover on the exchange declined to 4,935 crore rupees from 4,070 crore rupees in Monday’s trading. In trading on National Stock Exchange volume declined to 10,856 crore rupees from 8,908 crore rupees a day ago.

Of the 30 stocks in the Sensex, 20 fell and 10 gained. Wipro led the decliners in the index with a fall of 2.4%.

Jindal Steel & Power soared 5% to 4,150 rupees after the Bolivian senate approved the deal between the country’s government and Jindal to develop iron ore mine and build steel plant. Jindal has said to invest $2.3 billion in the project over the next ten years.

Rallies India jumped 3% to 325 rupees after the news that it is exploring a deal to purchase Arysta LifeScience Corp from private equity company Olympus Capital. The other bidder, United Phosphorus added 1.8% to 345 rupees. Four international companies in addition to two India companies are bidding for the Japanese company. The life science and crop protection company is valued at $2 billion or nearly 9,000 crore rupees.

Blue Dart Express increased 2.5% to 622 rupees on the news that it plans to spend 1,000 crore rupees to expand its fleet of aircraft, material handling equipment, and ground handling facilities.

Auto makers declined after a steep rise in the last week of trading. Maruti Suzuki led the decliners with a loss of 2% to 859 rupees followed by 1.5% loss in Tata Motors to 691 rupees. Mahindra & Mahindra fell 0.7% to 696 rupees.

Reliance Industries fell 6.40 rupees to 1,980 after reaching a new high of 2,007 rupees. The company agreed to acquire assets of Malaysian polyester company Hualon a day ago.

Weak U.S. trading and concerns of economic slowdown hurt software exporters again. Infosys fell 2.3% to 1,828 rupees, Wipro declined 2.5% to 455 rupees, and Satyam Computers lost 2.3% to 432 rupees.

Motilal Oswal priced its offering at the high end of its filing range to 825 rupees and valuing the company at 31 times earnings. The offering is oversubscribed by 27 times. The stock closed in BSE trading at 977.45 rupees, up 19% from its offering price. Other brokerage companies fell. JRG securities fell 6.6% to 53 rupees and Emkay Shares & Stock Brokers declined 8% to 142 rupees.

HDFC gained 2% to 2,145 rupees and reached intraday high of 2,153 rupees.

Nitco Tiles increased 4% to 239 rupees after the news that the company is venturing to distribute cement from Pakistan via MMTC. The government sole import agency Minerals and Materials Trading Company acts as sole import and export entity for most commodities import in India.

In other trading, NTPC, the domestic leader in power generation, gained 2.3% to 195 rupees after adding 2.5% on Monday. The Ministry of Power has asked government to relax conditions for borrowing funds in international markets in foreign currency.


[R]7:00AM New York, 8:00PM Tokyo - Property stocks lead marginal Japanese rebound. Japan machinery orders jump 17% in August. Ministries want 88.9 trillion yen for 2008 budget.[/R]

Stocks in Tokyo recovered from Monday losses on increased buying in real estate sector. Japan closed up 0.71% ending a six-day losing streak that peaked with a loss of 2.22% yesterday. Of the 225 stocks in the index, 146 stocks gained, 73 fell and 6 traded unchanged. Of the index shares, 41 stocks gained between 2% and 6.5%.

In Tokyo trading Nikkei 225 moved up 0.71% or 112.7 to 15,877.67, as bargain hunters returned for property shares that had fallen sharply in recent days.

Government announced Tuesday Japan’s core private sector-machinery orders surged 17% in August, the biggest climb in four years. The orders are considered a leading indicator of corporate capital expenditure. The highest surged stood at 17.2% in October 2003.

Finance Minister Fukushiro Nukaga said today ministries had made submissions of up to 88.9 trillion for fiscal 2008 budget, which is 7.3% higher than what government had budgeted for fiscal year 2007. Of the cumulative figure, 50.5 trillion yen relates to core policy outlays versus a spending limit of 47.4 trillion yen set by Cabinet for 2008 budget. At least 22.2 trillion yen was requested for debt servicing while that for domestic tax grants stood at 16.2 trillion yen. Nukaga said Tuesday: ""We need to cut around 3 trillion yen to curb the total budget within the upper limit.""

Japan media reported that the government was evaluating the prospect of eliminating the corporate tax on dividend income from subsidiaries abroad to help spur local investment. The current tax system levies domestic corporate tax on income of overseas Japanese firms’ units.

Of the Nikkei 225 shares, real estate stocks gained most. Nippon Suisan led gainers surging 6.1% followed by oil producing firm, Inpex Holdings ending up 5%. Mitsubishi Estate Co lifted higher 4.3%, Nikon Corp rose 4.2% while Taiyo Yuden Co gained 4.18%. Property stocks Sumitomo Realty advanced 4.11% shedding yesterday’s losses, Tokyu Land Corp pushed up 3.9%. Heiwa Real Estate and Mitsui Fudosan gained 3.8% and 3.5% respectively.

In the index, pharmaceutical stocks fell. Hitachi Zosen paced decliners falling 4.5% followed by Sumitomo Osaka down 2.9% and Hino Motors lost 2.85%. Daiichi Pharmacy Co and Chugai Pharmacy Co dropped each 1.9%. Astellas Pharmacy fell 1.5%, Takeda Pharmaceutical shed 1.2% and Shin ETSU Chemicals eased 1.6%.

On Monday, Japanese government consented to the proposed privatization of the Japan Post Corp, the culmination of a 10-year privatization process to start effectively October 1. Under the process, Japan Post Corp will be split into four stock units-savings, insurance, mail and over-the counter services. The holding company with 26,000 ATMs would be de-activated by September 30 to pave way for privatization. All postal ATMs installed at post offices and other locations across Japan need to be suspended so as to confirm the amount of cash Japan Post holds on the last day as a public corporation, Japan Post has said. ATMs operated by financial institutions and convenience stores tied up with Japan Post will not be affected.