Opening Bell 4 April | Weak US data drags sentiment

Indian stocks may take cues from weak Asian and US markets

 

A file photo of the BSE building in Mumbai. Photo: Mint  

          Mumbai: Don’t be “unduly pessimistic,” that’s the message Prime Minister Manmohan Singh has given to business leaders at a Confederation of Indian Industry conference. While admitting to the problems of corruption and bureaucratic inertia, the Prime Minister has expressed confidence about implementing more policy actions to push growth.

Asian markets are trading lower. Japan’s Nikkei lost 1.51% to 12,175 on speculation that the Bank of Japan may not meet forecasts for monetary policy expansion.

Also weighing on the investor sentiment is the weak economic data from the US. A survey has showed that private employers in the US added fewer jobs in March compared with the previous month. Employers have reportedly added 158,000 jobs last month, down from February’s gain of 237,000.

While economists have forecast the private sector will add 215,000 of jobs, the weak data spurred concerns about overall economic recovery in the US. The S&P 500 lost 1.05% to 1,553 on selling in shares of energy companies. Read the Bloomberg report.

Back home, the Ambani brothers are extending their new-found partnership beyond the telecom infrastructure space. Reliance Industries Ltd has parked more than Rs.800 crore in various mutual fund schemes of Anil Ambani’s Reliance Group. Reliance Mutual Fund is a part Reliance Capital Ltd. Read more.

Diageo Plc’s $2 billion deal to buy a majority stake in United Spirits Ltd (USL) will take longer to complete, reports Mint. The delay is partly due to lenders selling USL shares they held as collateral. Diageo now reportedly hopes to complete the deal in the current quarter to 30 June.

Meanwhile, lenders to the Kingfisher Airlines Ltd are planning to continue selling shares of the United Spirits Ltd pledged with them. Lenders have reportedly sold around 7.3 lakh of the 26 lakh shares of United Spirits pledged with them.

Kolkata-based industrialist Saroj Kumar Poddar, chairman of the Adventz Group has expressed his interest in taking over Mangalore Chemicals and Fertilizers Ltd from the UB Group. The Adventz Group has already acquired 10% stake in Mangalore Chemicals and Fertilizers Ltd. Read the Mint report.

Sterlite Industries (India) Ltd has halted deliveries of copper after it was forced to shut down a smelter due to complaints over emissions. The smelter that produces more than 300,000 tonnes of copper output per year, was halted last week by local authorities at least until a hearing into the complaints on 9 April. Read the Mint report.

Shares of TVS Motor Co. Ltd may continue to trade with positive momentum. The company has confirmed that it is in talks with BMW’s motorcycle division for a technology tie up.

Finally, gold is nearing a bear market as investor holdings dropped to the lowest level since August. The precious has metal lost 7.5% so far this year. Investors are paring their holdings on speculation that a recovery in the US economy will reduce the appeal of bullion as a safe haven. Read the Bloomberg report. 

 

TOUHID HUSSAIN

PGDM 2nd SEM