Markets open on a volatile note

Thu, 29 Jul 09:30 am

   Previous Close   

   Pre-Open   

   11:30 am   

   01:30 pm   

   Closing   

The Indian markets have started today's session on a volatile note. The benchmark indices opened below the breakeven mark, but soon moved into the positive territory. However, they have not managed to hold on to their gains since then. Other key Asian markets are in the red with Japan (down 0.5%) leading the pack of losers. The US markets closed lower by 0.4% yesterday.

Currently in India, heavyweights from the BSE-Sensex are trading weak with banking and engineering majors facing the brunt of selling activity. The BSE-Sensex is trading higher by around 10 points, while the NSE-Nifty is up by about 3 points. Some buying interest is also being witnessed among mid and small cap stocks as the BSE-Midcap and BSE-Smallcap indices are trading higher by 0.2% and 0.3% respectively. The rupee is trading at 46.71 to the US dollar.

FMCG stocks have opened the day on a positive note. Gainers here include Marico and Godrej Consumers. Marico has announced its 1QFY11 results. The company has reported a topline growth of 13% YoY during the quarter. This has been driven by a 16% YoY volume growth. The volumes of parachute rigid packs grew by 14% YoY, while Saffola grew by 18% YoY during the period. Operating margin fell by 0.5%, to 13.3%. This comes on the back of higher raw material costs though partly offset by lower advertisement and sales promotion expense and lower staff costs (all as percentage of sales). The company's net profit grew by 32% YoY during the quarter aided by higher operating income, higher other income, lower interest costs, lower effective tax rate, and the absence of an extraordinary loss.

Energy stocks have opened the day on a positive note. Gainers here include Essar Oil and Indraprastha Gas. As per a leading business daily, Reliance Industries is interested in BP's retail outlets, terminals and aviation turbine fuel facilities in at least four countries in Africa. Interestingly, the move coincides with ONGC's plans to bid for a BP stake in a Vietnam oil field. While BP wants to exit the Vietnam field to partly make up for the US$ 32 bn cost for the Gulf of Mexico oil spill, the sale of retail assets in Africa is apparently not connected to the spill. Instead, it is part of a trend among global companies to focus attention in the upstream oil and gas production business. Reliance Industries has a large storage facility in Kenya. It currently exports fuel to Gulf Africa Petroleum Corp (Gapco), a company it had acquired in 2007. A foothold in Africa will help the company in pushing petro products in countries where margins are almost double of that in India.