Thursday, April 2, 2009

US stocks open higher on G20 optimism

2 Apr 2009, 1920 hrs IST, AGENCIES
NEW YORK: US stocks opened higher on Thursday on confidence that a Group of 20 summit of developing and developed nations will make some headway in dealing with the global financial and economic crisis. The Dow Jones Industrial Average rose 154.12 points (1.99 percent) in the first trades to 7,915.72, setting the stage for what could be a third consecutive Wall Street rally this week. The tech-heavy Nasdaq composite added 28.20 points (1.82 percent) to 1,579.80 while the broad-market Standard & Poor's 500 index climbed 18.39 points (2.27 percent) to 829.47. Traders said the market was boosted by what was being seen as a more optimistic scenario emerging from the G20 summit in London, while reminding however that market rebounds had been typically volatile. "Early reports from the G20 meeting focused on dissension and difficulties in global coordination for dealing with economic issues," analysts at Briefing.com said in a note to clients.
"The reports now stress words like 'headway' and 'progress' on issues such as providing more liquidity to the IMF and regulation of hedge funds. "Whether any resulting pronouncements will result in stronger global economies can be questioned, but the markets are encouraged that nations are at least attempting to coordinate actions," the note said. After sharp differences over how to restore confidence, G20 summit officials have agreed that the International Monetary Fund could get up to 500 billion dollars in extra funding and a tax-haven blacklist could be drawn up as part of financial reforms. British Prime Minister Gordon Brown said in his opening speech to the summit that there was a "very high degree of consensus."

2009 among worst years for equities

Hindustan Times,Mumbai, April 01, 2009
Weak GLOBAL markets, heavy selling by foreign institutional investors (FIIs), slowdown in the domestic economy and a tight monetary policy in the first half of 2008-09 have worked towards making 2009 the second worst year for Indian equities in three decades. In 2009, the 30-share sensitive index, Sensex, fell 36 per cent. The index recorded its worst fall in 1993 when it crashed 47 per cent, according to a report by Motilal Oswal Financial Services Ltd (MOFSL). The index, however, recovered 66 per cent in 1994. Another highlight of 2009 has been a 27 per cent depreciation of rupee’s value against the US dollar.

The report said the company expects oil refining and marketing companies to report profits due to the issuance of oil bonds. The company predicts most sectors to report either a decline or single-digit growth in earnings, with just 3 out of 16 sectors reporting double-digit earnings growth.

The report also said that the estimated real GDP growth of 6.7 per cent in 2008-09 is led by a strong domestic consumption. Sectors that had reported significant drops in business momentum in the third quarter of 2008-09, have witnessed strong recovery in the fourth quarter.