(RTTNews) - Monday, investors are likely to make selective buying due to expectations of a second stimulus package from the government and rate cuts by the RBI after the index of wholesale inflation dropped to a nine-month low last week. Recent cuts announced in lending rates by several banks and reports that the government is considering fuel price cuts once again may also generate buying interest.

On a net basis, foreign funds bought shares worth Rs.1627 crore till December 18, while they offloaded shares worth Rs.52, 690.90 crore in the calendar year so far.

However, there could be volatility due to a truncated trading week on account of a public holiday on Thursday and due to the expiry of December series derivatives contract on Wednesday.

While FII participation may remain minimal due to Christmas and New Year celebrations, buying by domestic financial institutions such as mutual funds and insurance companies are expected to influence market movement.

Currently, markets across the Asia-Pacific region are trading mixed after US President George W. Bush announced loans to shore up U.S. automakers. China’s Shanghai Composite index is down 2.19% and Hong Kong’s Hang Seng index is losing 1.06%, while Japan’s Nikkei 225 index is up 1.09%.

Last week, the Indian market rose modestly on account of buying by FIIs and a sharp deceleration in inflation, which fell to a 9-month low amid a slump in crude oil prices. The BSE Sensex settled at 10,100, up 410 points or 4.22% for the week, and the S& P CNX Nifty ended at 3,077, up 156 points or 5.34%.

Meanwhile, the market value of Indian ADRs climbed two billion dollars last week, even as Satyam Computers lost 1.62 billion dollars after the Maytas-buyout fiasco. IT giant Wipro gained the most, adding 1.06 billion dollars to its market capitalization.

Stocks to Watch

Auto ancillary companies such as Sundaram fasteners, Clutch Auto and the others focused on export markets may rise following the approval of a US bailout package for troubled auto giants - General Motors and Chrysler LLC.

Pyramid Saimira could be in focus after the Sebi asked one of its promoters, P S Saminathan to make an open offer to acquire further 20% stake at not less than Rs.250 per share as against Friday’s closing price of Rs.75 on the BSE. According to the Sebi, Saminathan crossed the creeping acquisition limits by acquiring the company’s shares in the period between June and December 2008.

Tata Motors could see some activity following reports that the company has agreed to inject “tens of millions” of pounds into Jaguar Land Rover to prevent an immediate cash flow crisis.

Maytas Infra may be in focus after the Andhra Pradesh government on Saturday night
issued an order sanctioning Rs.121 crore for Maytas to construct a 30-km stretch of the state highway in Cuddapah district.

Fortis Healthcare could see some activity after the company called for a board meeting on December 24 to consider and approve a proposal for raising funds by way of further issue of capital on a “Rights Basis” to existing shareholders.

Unitech could be in focus on reports that ITC, Accor and some high net worth individuals are in the race to acquire its six hotel properties.

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Posted in Categories: Japan, Releases, Stocks, USA.

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