The Sensex fell 1.4% on Thursday due to rising food inflation and below-normal monsoon rains worrying investors. Asian markets also declined sharply with the Nikkei and Hang Seng falling over 3-4% after the US markets reported declines of 4-5% overnight on concerns about the global economy. Domestic inflation remains high and foreign investors are in panic selling mode, prompting expectations of further declines in Indian markets today.

1. K E Y N O T E
INSTITUTIONAL RESEARCH
India Morning Note
Friday, August 5, 2011
Domestic Markets Snapshot
Name of Index Aug 3 Aug 4 Change (%) Views on markets today
Sensex 17,940.55 17,693.18 -1.38% • The Sensex fell 1.4% on Thursday; extending a slide
CNX Nifty 5,404.80 5,331.80 -1.35% into a third consecutive day due to pick-up in food
inflation and below-normal monsoon rains also
BSE Mid-cap 6,785.59 6,734.16 -0.76%
unnerved investors. India's food price index rose
BSE IT 5,739.79 5,682.06 -1.01% 8.04% for week ended July 23 against 7.33% a week
BSE Banks 12,162.74 12,034.80 -1.05% ago. The market sentiment remains edgy, with
investors worried that rising inflation would force the
FII Activity (`Cr)
central bank to hike interest rates again. A number of
Date Buy Sell Net commercial banks have raised lending rates recently
3-Aug 1866 1949 -83 after the central bank raised its key lending rate by a
2-Aug 1866 1949 -83 steeper-than-expected 50 basis points at a policy
review on 26 July 2011.
Total Aug 5581 5589 -9
2011 YTD 389174 380449 8725 • On the BSE Sectoral front, Realty down 2.16%, Auto
down 2.06%, FMCG down 1.82%, Metal down 1.76%,
MF Activity (`Cr) Bankex down 1.05% and IT down 1.01% were the
Date Buy Sell Net major losers.
3-Aug 568 544 24 • Market breadth was very weak at ~0.66x due to
2-Aug 437 455 -18 selling pressure. FIIs sold equities worth `254.55Cr
while domestic institutions bought equities of
Total Aug 1352 1507 -155
`316.50Cr.
2011 YTD 81015 77664 3623
• Asian markets declined sharply on panic selling after
Volume & Advances / Declines the US markets reported 4-5% decline overnight.
NSE BSE • The investors sold shares ahead of a key report on US
Trading Volume (`Cr) 11,222 2,576 jobs today. Both the Nikkei and the Hang Seng are
trading with over 3-4% decline.
Advances 478 1,127
Declines 979 1,705 • We expect a gap down opening as the global investors
are on panic selling mode. We may see a selling from
Unchanged 67 135
the foreign investors today as the picture of the global
Total 1,524 2,967 economy is not clear. Besides that no relief from the
Global Markets domestic economy is in sight as the inflation continues
to remain at higher levels.
Index Latest Values Change (%)
DJIA 11,383.68 -4.3%
Economic and Corporate Developments
NASDAQ 2,556.39 -5.1%
• Attributing high inflation to global factors, the Planning
Nikkei * 9,334.26 -3.4% Commission Deputy Chairman Montek Singh Ahluwalia
Hang Seng * 20,916.51 -4.4% said containing price rise continues to be the top
* as of 8.45AM IST priority of the government.
Currencies / Commodities Snapshot • In a bid to prepare a Bill on amending the century-old
Indian Stamp Act of 1899 more relevant, the
Latest Previous
Quote Close government is putting provisions to check that states
do not fix stamp duty rates arbitrarily. The Bill seeks to
Indian Rupee per $ 44.42 44.55
empower stock exchanges to collect the stamp duty
Indian Rupee per € 62.68 63.44
on securities transaction in a centralised manner,
NYMEX Crude Oil($/bbl) 85.86 86.63 simplify the rate structure, and introduce some new
Gold ($/oz) 1,651.20 1,657.50 terms, among other amendments.
Silver ($/oz) 39.27 38.88
Keynote Capitals Institutional Research (research@keynoteindia.net) (+9122-30266000)
Keynote Capitals Institutional Research is also available on
Bloomberg KNTE <GO>, Thomson One Analytics, Reuters Knowledge, Capital IQ, TheMarkets.com and securities.com
Keynote Capitals Institutional Research - winner of “India’s Best IPO Analyst Award 2009” by MCX-Zee Business
To unsubscribe from this mailing list, please reply to unsubscribe@keynotecapitals.net

2. K E Y N O T E
INSTITUTIONAL RESEARCH
TOP GAINERS
Buzzing Stock
(BSE A-Group)
• Maruti Suzuki set to cut exports of diesel engines to
Previous Current Change Hungary and concentrate on the Indian market.
Company Name
Close (`) Price (`) (%)
Hindustan Copp 247.15 262.80 6.33 • Ashok Leyland and Nissan are reviving their
HPCL 377.35 392.40 3.99
greenfield project at Sriperumbudur and is targeted
at the equal joint venture's plans for growth in the
Indian Oil Corp 318.30 329.35 3.47
automotive sector beyond FY 16, regarded as Phase
BPCL 665.00 685.95 3.15 II.
TATAGLOBAL 107.90 111.00 2.87
• Havells planning to enter into the domestic
(BSE Mid-Cap) appliances market with an aim to garner sales of
Previous Current Change `500Cr from the segment in the next four years.
Company Name
Close(`) Price(`) (%) • Areva T&D India’s transmission business flagged off
COX KINGS 220.80 235.00 6.43 the world's largest 1200 kV capacitive voltage
Jindal Poly 234.00 244.45 4.47 transformer from its Hosur facility.
Hindusthan Nat 204.05 212.15 3.97 • Sun TV Network is planning to launch five more
ATAGLOBAL 107.90 111.00 2.87 channels this fiscal. The Kalanithi Maran-run network
FAG Bearings 1212.30 1240.00 2.28 is also planning to invest `150-160Cr on acquiring
movie content.
TOP LOSERS • Diesel engines manufacturer Cummins India is
(BSE A-Group) setting up a global technology centre in Pune for
their research and development projects which will
Previous Current Change
Company Name accommodate over 2500 engineers. The company is
Close(`) Price(`) (%)
investing around `337Cr for this centre.
ADANI POWER 101.00 93.55 -7.38
• Tata Steel said it will invest 7mn pounds (over
HDIL 137.25 129.65 -5.54
`500Cr) at its Hartlepool mill in the United Kingdom
Jindal Saw 143.90 137.35 -4.55
to enhance the welding and material handling
M&M 710.90 679.25 -4.45 capability.
Shre Renuka Sug 68.55 65.60 -4.30
(BSE Mid-Cap) US markets
Previous Current Change
Company Name US equities dropped sharply by 4-5% reflected
Close(`) Price(`) (%)
Gujarat NRE Cok 42.90 39.10 -8.86 investor worries after a statement came from the
chief of the European Central Bank (ECB) on
India Sec 45.15 42.00 -6.98
downside risks. The Dow and the S&P fall more than
Anant Raj Inds 79.50 74.10 -6.79
4% on Thursday and the Nasdaq lost 5% on fear the
HDIL 137.25 129.65 -5.54 United States is on the verge of another recession
Bombay Dyeing 334.25 316.30 -5.37 and that Europe's sovereign debt crisis is at nowhere
to end. This is in spite the jobless claims numbers
were not very discouraging.
The Dow Jones industrial average was down 512.46
points, or 4.31%, at 11,383.98. The Standard &
Poor's 500 Index declined 60.21 points, or 4.78%, at
1,200.13. The Nasdaq Composite Index lost 136.68
points, or 5.08%, at 2,556.39.
KEYNOTE CAPITALS LTD.
4th Floor, Balmer Lawrie Building, 5, J. N. Heredia Marg, Ballard Estate, Mumbai 400 001. INDIA
Tel. : 9122-2269 4322 / 24 / 25 • www.keynoteindia.net
Disclaimer: This report is purely for information purpose and is based on public information. News content is attributable to
various media, unless specified otherwise. All market related statistical data pertains to the immediately preceding trading day,
unless stated otherwise. Neither the information nor any opinion expressed in this report constitutes an offer, or an invitation to
make an offer, to buy or sell the securities mentioned herein. We or any of our directors, officers or employees shall not in any
way be responsible for any loss arising from the use of this report. Investors are advised to apply their own judgment before
acting on the contents of this report. The report has not been edited due to time constraints.