However trading might be cautious ahead of the government’s release of inflation data for the year through 14 June 2008. The wholesale price index rose 11.05% in the 12 months to 7 June 2008. The rate was above market expectation of about 10% rise. The reading was the highest in 13 years since 6 May 1995, when it was 11.11%.
To add to the negative sentiment, Standard and Poor’s (S&P) and its Indian subsidiary Crisil have lowered their India growth forecast for the current year to 7.8% from 8.1-8.6% earlier. The agencies said that the Indian economy would be hit by the surge in inflation fuelled by energy and commodity prices. The Reserve Bank of India (RBI) has already hiked interest rates twice in June 2008 to curb inflationary pressures and may well do so again.
As per reports, the marketwide rollover of positions from June 2008 contracts to July 2008 contracts in the derivatives segment stood at 82% while that of Nifty was 70%. June 2008 derivaties contracts expired yesterday, 26 June 2008.
Asian markets were trading weak today, 27 June 2008. Shanghai Composite plunged 3.67% or 106.41 points at 2,795.44, Japan's Nikkei fell 2.22% or 307.20 points at 13,515.12, Hang Seng tumbled 2.64% or 592.71 points at 21,862.96, Taiwan's Taiwan Weighted declined 3.99% or 311.64 points at 7,500.16, Singapore's Straits Times lost 1.41% or 42.02 points at 2,938.93. and South Korea's Seoul Composite was down 2.10% or 36.01 points at 1,681.65
US markets plunged after a downgrade on brokerage stocks, disappointing earnings from two tech giants and oil's rally above $140 a barrel. The Dow Jones closed at its lowest level since September 2006. The Dow Jones industrial average plunged 358.41 points, more than 3%, to close at 11,453.42. The Standard & Poor's 500 fell 38.82 points, about 3 percent, to 1,283.15, and the Nasdaq composite lost 79.89 points, or 3.3%, to 2,321.37.
Back home, short covering ahead of expiry of June 2008 derivatives contracts helped market move higher for the second straight session yesterday, 26 June 2008. The 30-share BSE Sensex gained 201.75 points or 1.42% at 14,421.82 and the broader based S&P CNX Nifty was up 63.20 points or 1.49% at 4,315.85, on that day.
Nifty July 2008 futures were at 4252.95, a huge discount of 62.90 points as compared to spot closing.
The BSE Sensex is down 5,865.17 points or 28.91% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2008. It is 6,784.95 points or 31.99% away from its all-time high of 21,206.77 struck on 10 January 2008.
As per provisional data, foreign funds today, 26 June 2008, sold shares worth a net Rs 667.19 crore. Domestic funds bought shares worth a net Rs 395.64 crore.
Foreign institutional investors (FIIs) were net buyers of Rs 918.59 crore in the futures & options segment yesterday, 26 June 2008. They were net buyers of index futures to the tune of Rs 1023.89 crore and sold index options worth Rs 368.21 crore. They were net buyers of stock futures to the tune of Rs 33.80 crore and bought stock options worth Rs 33.80 crore.
U.S. light crude for August delivery was down 32 cents at $139.32 a barrel today, 27 June 2008 in Globex electronic trading. U.S. oil hit a record of $140.39 on Thursday after Libya said it was studying possible options to cut output in response to potential U.S. actions against OPEC countries.