Friday, 3 January 2014
Cash volumes continue to dip even as indices climb
Riken Mehta
Follow me on Twitter @mehtariken
Traded turnover in the cash market is a good indicator of retail participation in the stock market. And looking at the steady decline in cash market volumes since 2009, it is evident that retail investors are yet to regain their appetite for equities. F&O turnover on the NSE has jumped two-and-a-half times, but that is cold comfort even to the stock brokers, since the commission earned on these trades is a fraction of that earned on cash market transactions. 2013 may have been a good year or foreign institutional investors and a handful of market operators, but unless domestic investors (retail as well as mutual funds ) start participating in a big way, a broad-based upmove looks unlikely.
Follow me on Twitter @mehtariken
Traded turnover in the cash market is a good indicator of retail participation in the stock market. And looking at the steady decline in cash market volumes since 2009, it is evident that retail investors are yet to regain their appetite for equities. F&O turnover on the NSE has jumped two-and-a-half times, but that is cold comfort even to the stock brokers, since the commission earned on these trades is a fraction of that earned on cash market transactions. 2013 may have been a good year or foreign institutional investors and a handful of market operators, but unless domestic investors (retail as well as mutual funds ) start participating in a big way, a broad-based upmove looks unlikely.
Monday, 30 December 2013
Recap 2013: How equities, commodities, currencies performed
Riken Mehta
Follow me on Twitter @mehtariken
After nearly a six-year wait, Indian equity benchmarks, the BSE 30-share Sensex and the NSE 50-share Nifty broke their record highs this year. But that’s not it; 2013 saw a number of fresh multi-year record lows/highs both on the macro and investment front.
Despite FIIs investing USD 20 billion in 2013, the index returns for FIIs in dollar terms is negative at 3.91 percent primarily due to rupee depreciation. The year 2013 has been more stock and sector specific with IT, pharma and FMCG leading the list of winners.
Let’s take a look at how various asset classes fared in the year 2013.
Developed markets versus Emerging markets
As seen from the table, benchmark indices of US, UK and Japan have given handsome double digit returns so far this year. The momentum in these markets may continue as major indices of US (barring Nasdaq) and UK (barring CAC) are trading at life-high. Nikkei is trading close to its 6 year high. Emerging markets have posted negative or single digit positive returns this year, underperforming developed markets.
Commodities
Gold has posted its biggest annual loss since 1981 as investors shifted their money from safe haven asset class to risky asset class like equities on the back of strong economic growth in developed countries. Brent Crude remained in a narrow band of USD 95-115 per barrel.
Currencies
The domestic currencies of the emerging markets depreciated substantially this year on fears of tapering by the US Federal Reserve. The rupee depreciated to a record low of 69 levels making it one of the worst performing Asian currencies this year. Japanese yen on the other hand weakened to a five-year low on the back of loose monetary policy to spur growth in the economy.
Indian Indices
Follow me on Twitter @mehtariken
After nearly a six-year wait, Indian equity benchmarks, the BSE 30-share Sensex and the NSE 50-share Nifty broke their record highs this year. But that’s not it; 2013 saw a number of fresh multi-year record lows/highs both on the macro and investment front.
Despite FIIs investing USD 20 billion in 2013, the index returns for FIIs in dollar terms is negative at 3.91 percent primarily due to rupee depreciation. The year 2013 has been more stock and sector specific with IT, pharma and FMCG leading the list of winners.
Let’s take a look at how various asset classes fared in the year 2013.
Developed markets versus Emerging markets
As seen from the table, benchmark indices of US, UK and Japan have given handsome double digit returns so far this year. The momentum in these markets may continue as major indices of US (barring Nasdaq) and UK (barring CAC) are trading at life-high. Nikkei is trading close to its 6 year high. Emerging markets have posted negative or single digit positive returns this year, underperforming developed markets.
Commodities
Gold has posted its biggest annual loss since 1981 as investors shifted their money from safe haven asset class to risky asset class like equities on the back of strong economic growth in developed countries. Brent Crude remained in a narrow band of USD 95-115 per barrel.
Currencies
The domestic currencies of the emerging markets depreciated substantially this year on fears of tapering by the US Federal Reserve. The rupee depreciated to a record low of 69 levels making it one of the worst performing Asian currencies this year. Japanese yen on the other hand weakened to a five-year low on the back of loose monetary policy to spur growth in the economy.
Indian Indices
Friday, 27 December 2013
Live Market Commentary: Nifty stuck at 6300; TCS, DLF, SBI, Infy top gainers
Follow me on Twitter @mehtariken
3:45 pm Market closing: The market saw a strong performance with support by banks and IT stocks. The Sensex was up 118.99 points at 21193.58, and the Nifty ended at 6313.80 up 34.90 points. About 1374 shares have advanced, 1166 shares declined, and 147 shares are unchanged. BSE IT index jumped 2 percent with Infosys, TCS and Wipro as major gainers. However, oil & gas and auto stocks were under selling pressure. Maruti, Reliance, BHEL and Bajaj Auto were laggards.
3:30 pm Buzzing: Infosys hits record high at Rs 3570, up 1.5 percent intraday on the BSE. However, on the NSE it was just below a record high of 3,573.00 hit on December 20.
3:20 pm Update: Questioning the timing of the steep hike in CNG prices, Arvind Kejriwal today said he will examine whether the increase can be rolled back after taking charge as Delhi's Chief Minister, reports PTI.
"What was the need to increase CNG prices when a new government is to take over in Delhi. It raises suspicions about their intention. I will look at the files once I take over tomorrow and see if the hike can be rolled back," Kejriwal said here.
The AAP leader will be sworn in as Delhi Chief Minister tomorrow.
3:10 pm Market check: The Sensex is up 117.34 points at 21191.93, and the Nifty is up 34.00 points at 6312.90. About 1321 shares have advanced, 1109 shares declined, and 137 shares are unchanged.
TCS is up 3 percent, while other gainers in the Sensex are Cipla, Infosys, Wipro and HDFC. Among the losers are Reliance, BHEL, Maruti Suzuki, Bajaj Auto and Hero MotoCorp.
3.00pm: Stocks at 20% upper circuit: Smallcap stocks like DS Kulkarni, C Mahendra Exports, Taneja Aero, Modern Dairies and Cybertech Systems were locked at 20 percent upper circuit.
2:58pm Most active: The most active shares on BSE were Tata Elxsi, Aban Offshore, Infosys, MCX India and SBI.
2:54pm Rupee at day's high: Indian rupee was trading at day's high around 61.90 mark depreciating 0.42 percent compared to its previous close.
2:52pm Nifty at 6800-7000: Earlier today in an interview with CNBC-TV18, Vibhav Kapoor of IL&FS said he is more positive on the stock market now than he was two months back. His 12-month Nifty target is 6,800-7,000 and sees 5750-5800 as the base for the index. Read full interview here
2:47pm Buzzing Stock: Shares of Hindustan Motors rallied 5 percent intraday on Friday as it gears up for restructuring. The company has been suffering from poor cash flow due to lack of vehicle sales. Read more
2:41pm: F&O buzzers: Hexaware, Apollo Tyres, Divi's Labs, Bank of India and TCS are top gainers in the F&O space. On the losing side, Aurobindo Pharma, Jindal Steel, Arvind and Ashok Leyland were trading in red.
Tepid volumes: Lack of participation from fund managers on account of year-end holidays have led to tepid volumes today. A turnover of Rs 62000 crore has been recorded so far which is far less compared to average volumes.
2:35pm: Price Shockers: Stocks like Rico Auto, Welspun Corp, Liberty Shoes, Vaibhav Global and McDowell Holidings have gained more than 50 percent in last 15 trading sessions.
2:30pm: 2013 Celebrity 100 list: In Forbes 2013 Celebrity 100 list, check out which cricketers and celebrities have made debuts this year. Read full story here
2:21pm: Commodity Check: MCX Feb Gold contract was trading at Rs 28429, down Rs 147 or 0.51%. The yellow metal has lost nearly 20 percent from its all-time high of close to Rs 35000 in August.
MCX March Silver contract was trading flat at Rs 44790. MCX Jan Crude oil contract was trading at Rs 6188, down 11 rupees.
The BSE Sensex was trading strong on the final day of the last trading week of 2013. IT heavyweights like Infosys and TCS were star performers of the day. Midcap IT and banking stocks were also minting money for traders.
The Sensex was up 119 points or 0.6% at 21194 and the Nifty was up 33 points or 0.5% at 6312.
The advance decline ratio still remains strong with 1284 shares advancing compared to 1041 shares declining.
TCS was top gainer in the Nifty with close to 3 percent gains followed by Kotak Mahindra Bank (up 2%), NMDC (up 1.9%), Cipla (up 1.75%) and HUL (up 1.27%).
BHEL, Jaiprakash Associates and Maruti Suzuki were top losers in the Nifty losing over a percent each.
In broader markets, stocks like Apollo Hospitals (up 6%), TVS Motor (up 5.14%), Bajaj Electricals (up 4.97%), Chennai Petro (up 4.37%) and KPIT Tech (up 4.30%) were buzzing on heavy volumes.
Friday, 20 December 2013
Nifty's 50 DMA holds the key for this rally to sustain
The 50 Day Moving Average of Nifty holds the key for this rally to sustain in the near term. As it is evident from the chart the Nifty took support around its 50 DMA on three occasions in last two months and bounced back sharply. As the name implies, it is an average of a certain body of data. For example, if 50 day moving average (DMA) of closing prices is desired, the closing price for the last 50 trading days are added up and the total is divided by 50. The term moving is used because only the last 50 days closing prices are used for calculations.
The 50 DMA acts as a support in an uptrend and resistance in
a downtrend. When the Nifty breaches 50 DMA on the upside in an ongoing trend
with heavy volumes, then one can infer there is a reversal in trend and
vice-versa. However, one must wait for the Nifty to close above or below 50 DMA
for 3 to 5 trading sessions on a consistent basis before concluding trend
reversal.
The moving average is a smoothing device. By averaging the
price data a smoother line is produced making it much easier to view the underlying
trend. Remember, moving average is a lagging indicator. What it means is that
20 Day Moving Average would hug the price action more closely than 200 Day
Moving Average.
Depending on your time frame, a shorter, medium or longer
term average can be used. A 50 day moving average would be more useful for
short term trend while 200 DMA will prove effective for the longer term.
Types of Moving Average
Simple Moving Average
Simple Moving Average is widely used by most of the
technical analysts. However, over the years this moving average has been
criticized for assigning equal weight ages to all days. In a 20 day average,
the last day receives the same weight age as the first day. This was taken care
by Exponential Moving Average
Exponential Moving Average
Exponential Moving Average assigns a greater weight to the
more recent data which is why it is called a weighted moving average. We will
not brief the calculation. Technical software’s and charts makes it easy for
you. All you have to do is select the number of days you want in the moving
average: 20, 90, 200 etc.
Tuesday, 17 December 2013
CNX IT index at multi-year high; Infosys, TCS, HCL Tech, Wipro at multi-year high
IT stocks have been one of the biggest wealth creators for investors over the years. CNX IT index, barometer of IT stocks has recorded fresh highs since 2004. The index has gained 211 percent in last nine years while rupee has depreciated 40 percent in the same period. Heavyweights like Infosys, HCL Tech, TCS and Wipro are trading at multi-year highs as strong US economy coupled with weak rupee favours IT stocks.
N Chandrasekaran, CEO and managing director of India's largest IT software company TCS also painted bullish picture for FY15. “FY15 will be a better than FY14 as per the initial talks that we have had with our clients. We expect a good growth overall -- retail, consumer goods and services, utilities, pharma, financial services, etc," N Chandrasekaran told reporters.
N Chandrasekaran, CEO and managing director of India's largest IT software company TCS also painted bullish picture for FY15. “FY15 will be a better than FY14 as per the initial talks that we have had with our clients. We expect a good growth overall -- retail, consumer goods and services, utilities, pharma, financial services, etc," N Chandrasekaran told reporters.
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Thursday, 12 December 2013
Chart: Nifty’s intra-year pullbacks over last 13 years
Riken Mehta
Follow me on Twitter @mehtariken
The Nifty's 23 percent rebound from the lows of August (and also the lowest point for the year) has taken investors by surprise. But this recovery is still not as strong as some of the comebacks seen over the last few years. The biggest bouncebacks were in 2003 and 2009, when the index more than doubled from the lows of the year.
Intra-year recovery is recovery from lows of the year to year end price
Chart: Nifty’s intra-year pullbacks over last 13 years
Read more at: http://www.moneycontrol.com/news/market-edge/chart-nifty%E2%80%99s-intra-year-pullbacks-over-last-13-years_1007134.html?utm_source=ref_article
<a href="http://www.hypersmash.com">www.hypersmash.com</a>
Read more at: http://www.moneycontrol.com/news/market-edge/chart-nifty%E2%80%99s-intra-year-pullbacks-over-last-13-years_1007134.html?utm_source=ref_article
<a href="http://www.hypersmash.com">www.hypersmash.com</a>
Tuesday, 10 December 2013
How MNC stocks fared in last six years
Riken Mehta
Follow me on Twitter @mehtariken
Follow me on Twitter @mehtariken
Dalal Street
cheered BJP’s victory with a big bang opening on Monday surpassing Nifty to a
record high of 6415. In today’s article, we will compare MNC stocks performance from the previous
life-highs the Nifty touched in 2008 to the current one. Out of 42 MNC companies
data analysed (m-cap greater than Rs 200 crore), top 10 companies have given
more than 100% returns in this period. Companies like Glaxo Smithkline Consumer
and Blue Dart have also reported healthy compound annual growth rate of 20
percent plus in sales and profits in the same period.
% Gain is from 8th Jan 2008 to 9th Dec 2013
| Company Name | CAGR Sales growth % in last 5 yrs (2008-2013) | CAGR Profit growth % in last 5 yrs | % CHG | P/E | P/B | Yield |
| Glaxosmithkline Consumer Healthcare Ltd. | 19.28% | 21.84% | 565% | 39.29 | 10.86 | 0.98 |
| Blue Dart Express Ltd. | 21.76% | 22.11% | 376% | 51.29 | 11.21 | 2.09 |
| Castrol India Ltd. | 10.47% | 15.42% | 313% | 31.39 | 17.46 | 2.31 |
| Bata India Ltd. | 16.24% | 33.48% | 311% | 34.98 | 8.16 | 0.58 |
| Berger Paints India Ltd. | 18.98% | 18.61% | 306% | 35.2 | 7.08 | 0.78 |
| Procter & Gamble Hygiene & Health Care Ltd. | 21.20% | 9.11% | 264% | 41.56 | 10.59 | 0.89 |
| Crisil Ltd. | 18.72% | 21.38% | 206% | 28.24 | 11.73 | 1.22 |
| Colgate-Palmolive (India) Ltd. | 15.64% | 15.98% | 177% | 37.9 | 32.2 | 2.58 |
| Kansai Nerolac Paints Ltd. | 15.39% | 19.69% | 174% | 34.31 | 4.24 | 1 |
| Hindustan Unilever Ltd. | 13.93% | 14.88% | 145% | 35.78 | 35.45 | 2.05 |
| Glaxosmithkline Pharmaceuticals Ltd. | 10.26% | 0.52% | 133% | 39.78 | 8.89 | 1.99 |
| Oracle Financial Services Software Ltd. | 7.86% | 20.91% | 98% | 23.23 | 2.84 | 0 |
| Styrolution A B S (India) Ltd. | 12.15% | 12.55% | 97% | 14.06 | 1.3 | 0.97 |
| Maruti Suzuki India Ltd. | 19.71% | 6.66% | 94% | 17.51 | 2.68 | 0.45 |
| Bosch Ltd. | 14.05% | 9.48% | 86% | 29.88 | 4.39 | 0.68 |
| Fresenius Kabi Oncology Ltd. | 16.11% | -3.95% | 75% | 344.01 | 3.26 | 0 |
| Gillette India Ltd. | 19.55% | -5.78% | 70% | 82.65 | 5.65 | 0.76 |
| Honda Siel Power Products Ltd. | 14.89% | -3.59% | 68% | 26.11 | 1.5 | 0.95 |
| Linde India Ltd. | 34.54% | 7.73% | 66% | 1.67 | 0.47 | |
| Cummins India Ltd. | 10.69% | 18.65% | 65% | 17 | 4.62 | 2.89 |
| Vesuvius India Ltd. | 11.78% | 11.69% | 60% | 12.82 | 2.25 | 1.03 |
| Pfizer Ltd. | 8.40% | 8.16% | 59% | 14.83 | 4.8 | 33.09 |
| D I C India Ltd. | 9.86% | 8.57% | 59% | 29.26 | 1.11 | 1.14 |
| S K F India Ltd. | 7.13% | 3.41% | 56% | 23.16 | 2.74 | 1.13 |
| Akzo Nobel India Ltd. | 18.60% | 29.58% | 54% | 21.41 | 3.32 | 9.6 |
| Wyeth Ltd. | 15.32% | 9.80% | 53% | 17.62 | 6.43 | 20.59 |
| Merck Ltd. | 16.89% | 2.64% | 43% | 15.19 | 1.91 | 0.41 |
| Ambuja Cements Ltd. | 11.42% | -6.09% | 37% | 30.06 | 3.12 | 1.86 |
| Mphasis Ltd. | 17.20% | 25.42% | 34% | 15.01 | 1.97 | 4.34 |
| Wendt (India) Ltd. | 11.73% | 7.64% | 33% | 21.63 | 2.65 | 1.39 |
| Astrazeneca Pharma India Ltd. | 5.14% | -207.81% | 26% | 7.33 | 0 | |
| A C C Ltd. | 9.72% | -5.79% | 24% | 23.89 | 2.74 | 2.57 |
| Honeywell Automation India Ltd. | 13.79% | 5.52% | 18% | 24.86 | 3.03 | 0.38 |
| Hitachi Home & Life Solutions (India) Ltd. | 15.63% | -18.38% | 11% | 2.33 | 0.91 | |
| Ranbaxy Laboratories Ltd. | 10.94% | -199.78% | 9% | 34 | 0 | |
| Paper Products Ltd. | 9.56% | 9.72% | 5% | 8.71 | 1.08 | 3.85 |
| Ingersoll-Rand (India) Ltd. | 2.80% | -22.60% | -6% | 15.93 | 1.27 | 1.67 |
| Thomas Cook (India) Ltd. | 8.58% | -0.58% | -11% | 42 | 3.13 | 0.47 |
| Esab India Ltd. | 7.98% | -6.79% | -13% | 18.94 | 2.65 | 1.66 |
| Siemens Ltd. | 3.13% | -20.26% | -35% | 142.61 | 5.79 | 0.93 |
| Monsanto India Ltd. | 3.81% | -7.64% | -36% | 12.72 | 3.3 | 10.62 |
| A B B India Ltd. | 4.96% | -22.11% | -54% | 108.79 | 5.39 | 0.43 |
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