Can a better than expected second tranche of liquidity to European banks fuel a rally in our market today? Read on for more...
While the European Central Bank's second liquidity injection operation was met with cheer, global markets reacted to Federal Reserve Chairman Ben Bernanke's silence on not signalling any further monetary easing to stimulate growth in the US.
European banks took larger than expected amounts of cheap three year loans from the ECB. In all, 800 banks took around 530 billion euro in funds pushing the total of LTRO money borrowed over the trillion euro mark. The first LTRO saw 489 billion euro being funded.
Europe Closing: FTSE down 1%; DAX down 0.5%; CAC flat
Bernanke dashed hopes of any further monetary stimulus during his speech to Congress on the economy. However, the S&P surged 8.7% since January, logging its best start to the year since 1991. The Nasdaq briefly topped 3,000 in intraday trading for the first time since December 2000.
US GDP grew at a 3% annual rate, logging the fastest gain since the second quarter of 2010. Weekly mortgage applications rose last week as interest rates dipped.
US Closing: Dow down 0.4% at 12,952; S&P down 0.5% at 1,365.7; Nasdaq down 0.7% at 2,966.89.
Data to Watch
- US Jobless Claims
The MSCI Asia Pacific ex-Japan fell 0.3% after rising 1.4% to a seven-month high on Wednesday, taking its cues from US stocks which were weighed down by Bernanke's comments.
Japan's Nikkei opened up 0.5% and extended its gains in early trade. Korean markets are shut today on account of a public holiday.
Asia Today: China Feb PMI 51 Vs 50.5 (MoM); Shanghai, Hang Seng down 0.2%; Nikkei up 0.5%; Straits up 0.3%; Taiwan up 0.2%
Commodity & Currency Corner
In the currency space, there was major profit booking on the euro-dollar post LTRO2. The euro continued to trade lower, at 1.33 to the dollar versus yesterdays high of 1.3485. The dollar Index is at 78.8 versus 78.2 yesterday.
Crude price trended higher as speculation that the US’ economic growth will boost fuel demand countered by concern that rising supplies will limit price gains.
Putting the brakes on our stellar rally of the past two months, it was a volatile session of trade on Dalal Street as indices were disappointed by weak GDP data. The Nifty lost quite a bit of ground but finally closed flat at 5,385 up 10 points. Sensex too saw some major cuts but closed 21 points up at 17,752.
Stocks in News
ONGC will sell 5% equity via an auction today. The government is aiming to raise at least Rs 12,000 crore via this auction.
The power ministry's 19% import duty on power project equipment proposal is expected to be taken up by the Cabinet and CCEA. The cabinet will also take up the revised prices for non-urea fertilizers. Watch out for these stocks today.
Monthly auto sales numbers' are due today. According to a CNBC-TV18 poll, retail volumes may remain slow especially within the two-wheeler space. However, the strong growth momentum may continue for companies like M&M's automotive segment.
Jet Airways is looking to raise about USD 200 million to meet its working capital requirements. Sources say lenders may be on board with the proposal.
Tata Communications may bid for UK listed Cable and Wireless reports The Times of India (deal size seen over USD 1.2 billion)
Tata Motors plans image makeover for Nano, gears up for 800cc engine, reports The Economic Times.
Pantaloon Retail may exit its JV with Staples Inc by June and pocket Rs 200 crore in the bargain, according to a report in The Economic Times.
Source Say that Reliance Communication will move TDSAT. The company seeks Rs 70 crore arrears from S-Tel.
Binani Industries board okays 49% restructuring of co's investments in Goa Glass Fibre.
Orient Abrasives to demerge refractories business.
Gayatri Projects rights issue opens on March 5 and closes on March 19 at a ratio of 1:1 and a share price of Rs 120/sh.
Sundaram Multi Pap Board recommends 2:1 bonus.
I-T department raids premises of Uttam Galva Steel , reports The Economic Times.
Bajaj Holdings takes 3% in MCX, according to a report in the Business Standard.
MTNL is struggling in the CDMA businesses and may close down operations, reports the Business Standard.
Tera Software will issue non-convertible debentures of Rs 50 crore to QIB's.
Results Today: MphasiS
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