Moneycontrol Bureau11:55 am Sugar surge: Sugar's biggest rally in four years may be far from over, according to a survey of a dozen analysts and traders, who say prices are on course to reach one-year highs by next March as the market braces for its first supply deficit in six years.
Sugar has been one of the worst-performing commodities in recent years. Falling output in the world's top growers, Brazil, India, China and Thailand and resurgent ethanol demand will help the sweetener market escape an unprecedented five-year surplus and stock build that have pummeled prices, respondents said.
The price forecasts were in a wide 5-cent range, reflecting near-term caution amid concerns India, the world's top producer, will flood the market with unwanted inventories if prices breach 15-16 cents per lb.11:45 am Market outlook: There is a huge amount of surging liquidity in the system that is waiting to get into equities and to that extent even a visit to 7500 has not dented the spirit of the Indian market, says Ajay Srivastava, CEO of Dimensions Consulting. However, questions are being raised and quite rightly so that the fact that the markets are going up is not backed by fundamentals, he says.
"The quality of the rally is a little worrying as beaten down names such as Jaiprakash and Lanco Infra are the stars of this rally," he told CNBC-TV18. Also, he says global and domestic factors are such that if the Reserve Bank's rate cut or future cuts if there are any don't work, then the Nifty may once again test 7500 levels as there aren't any cues that will help sustain or push the market from current levels.11:30 am Buzzing: Shares of United Spirits fell 3 percent intraday on Friday. Maintaining sell rating, Citi has reduced target price to Rs 2347 from Rs 2645 a piece. The brokerage has also cut consolidated earnings per share (EPS) estimate by 7-15 percent tweaking down pricing and mix gains.
Citi thinks there is too much focus on margins and premiumisation, while little attention has been paid to the brand shifts occurring in the industry in the past few years. "While United Spirits restructures, its competitors have become much larger at a very rapid pace," it says in a report.
Premiumisation is a defensive tactic to offset margin pressures but with all players adopting it, gains envisaged 2-3 years ago are proving to be elusive, it adds.Don't miss: Goldman Sachs retains buy on Titan; stock rises 2%
The market continues its rally ahead of September quarter earnings. The Sensex is up 237.26 points or 0.9 percent at 27083.07 and the Nifty is up 63.45 points or 0.8 percent at 8192.80. About 1464 shares have advanced, 777 shares declined, and 94 shares are unchanged.
Vedanta, Hindalco, Tata Steel, ICICI Bank and Tata Motors are top gainers in the Sensex. Among the losers are Coal India, Sun Pharma, TCS, BHEL and Wipro.
Oil prices extended their recent rally in Asia on Friday on hopes that increasing demand and a decline in US crude production would ease a supply glut that has depressed the market for more than a year.
The two main crude contracts hit a six-year low during the April-September quarter owing to a fears about an oversupply, China's economic crisis and expectations for a US interest rate rise.
However, they have surged recently as the US Federal Reserve shows signs it will hold off hiking rates -- a rise would strengthen the greenback, making dollar-priced oil more expensive - while recent data from Beijing have soothed nerves.
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