Indian markets continued their downward movement, closing lower due to weak industrial production numbers, a weakening rupee, and weak European markets. The Sensex fell over 2% and closed below 15,870 points. All sectoral indices closed in the red except for IT. Weak global commodity prices and concerns over the European debt crisis dragged down metal and oil & gas stocks. Asian markets also opened sharply lower today following the cues from the US and Europe.

1. K E Y N O T E
INSTITUTIONAL RESEARCH
India Morning Note
Tuesday, December 13, 2011
Domestic Markets Snapshot Views on markets today
Name of Index Dec 9 Dec 12 Change (%) • Indian markets continued with downward movement
Sensex 16,213.46 15,870.35 -2.12% and closed on negative note yesterday as dismal IIP
numbers, weak rupee and weak European markets
CNX Nifty 4,866.70 4,764.60 -2.10%
dragged the markets sharply. After announcement of
BSE Mid-cap 5,620.85 5,513.91 -1.90%
very poor IIP numbers, the Sensex immediately
BSE IT 5,733.49 5,787.82 0.95%
started to show a small recovery, believing that the
BSE Banks 10,157.05 9,854.61 -2.98% time has come to open up the liquidity. However,
FII Activity (`Cr) weak rupee led a sharp fall in the Sensex again and it
tumbled below 16,000 before opening of the European
Date Buy Sell Net
markets. India's IIP registered a negative growth of
9-Dec 1,770 2,062 -292
5.1% for October 2011, as tight money supply, high
8-Dec 2,210 2,014 196
cost of inputs and costly funds weighed on the
Total Dec 13,344 11,532 1811 industrial production. The weak opening in the
2011 YTD 581,788 582,921 -1133 European markets put the final hammer on the Sensex
MF Activity (`Cr) and it dropped below crucial 15,900 levels. Except IT,
all sectoral indices closed on negative note with metal,
Date Buy Sell Net
bank, oil & gas and real estate stocks were major
9-Dec 379 581 -202 losers. Sharp drop in the commodity prices globally,
8-Dec 341 561 -221 after weak European markets due to issue of short
Total Dec 2587 2933 -346 term bonds by France and Italy led to a sharp fall in
2011 YTD 124,812 119,711 5101 Indian metal and oil & gas stocks. Emami tumbled
8.9% after a fire in a private hospital it part owns in
Volume & Advances / Declines
the eastern Indian city of Kolkata on Friday, killing at
NSE BSE least 84 people. While Union Bank fell 3.7% after
Trading Volume (`Cr) 9,232 1,824 Goldman Sachs downgraded the bank to "sell" from
Advances 311 798 "hold." Goldman Sachs said asset quality issues and
Declines 1,171 1,943 lower Tier 1 ratio will hinder loan growth and it
Unchanged 50 121 expects the bank to lose market share in advances.
Total 1,532 2,862 • Market breadth was week at ~0.41x as investors sold
large cap stocks. FIIs sold equities worth `4.28bn while
Global Markets
domestic institutions bought equities of `1.66bn.
Index Latest Values Change (%)
• Asian markets are sharply lowered today after a fall in
DJIA 12,021.39 -1.3% the US and European markets, as investors worried
NASDAQ 2,612.26 -1.3% about Eurozone crisis.
Nikkei * 8,529.14 -1.4% • We expect Indian markets to open weak following the
Hang Seng * 18,341.56 -1.3% cues from the Asian markets and as the sentiments
* as of 8.25AM IST turned negative after yesterday's IIP data.
Currencies / Commodities Snapshot Economic and Corporate Developments
Latest Previous • India's industrial output shrunk by 5.1% in October
Quote Close against 11.4% last year during same month, led by a
Indian Rupee per $ 52.84 52.84 steep fall in production of almost sectors, particularly
Indian Rupee per € 69.68 69.59 manufacturing, mining and capital goods.
NYMEX Crude Oil($/bbl) 97.84 97.77 • Weakening of rupee against the US dollar has added
Gold ($/oz) 1,654.70 1,664.20 `50,000Cr to the fuel subsidy as the nation paid more
Silver ($/oz) 31.16 30.94 for its oil imports, Oil Secretary GC Chaturvedi said
today.
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2. K E Y N O T E
INSTITUTIONAL RESEARCH
TOP GAINERS Buzzing Stocks
(BSE A-Group) • Educomp Solutions launched its digital class
Previous Current Change transformation system (CTS) in Gujarat. The
Company Name company has been catering its educational services
Close (`) Price (`) (%)
Wipro 404.20 414.55 2.56 to around 150 schools in Gujarat and 8000 schools in
Torrent Pharma 548.50 558.85 1.89 India.
Aurobindo Phar 89.75 91.25 1.67 • Unitech put on hold its plans to demerge the
Gitanjali Gems 330.60 335.10 1.36 infrastructure vertical indefinitely on account of
Glenmark Ph 304.80 308.00 1.05 sluggishness in economy.
(BSE Mid-Cap) • IDFC sold 25% stake in its mutual fund business to
French major Natixis Global Asset Management
Previous Current Change
Company Name (NGAM) for an undisclosed amount.
Close(`) Price(`) (%)
VAARAD 37.25 38.90 4.43 • The Telecom Disputes Settlement & Appellate
Greaves Cotton 75.00 77.00 2.67 Tribunal (TDSAT) directed Bharti Airtel and Tata
Dewan Housing 202.75 207.95 2.56 Communications to pay 10% of the `50Cr penalty
Shree Global Trd 222.65 227.90 2.36 each imposed on them by the Department of
Torrent Pharma 548.50 558.85 1.89 Telecommunications (DoT) for violation of ILD
licence terms and conditions.
TOP LOSERS • Reliance Industries' eastern offshore KG-D6 gas
(BSE A-Group) fields have seen output dipping to around 40mn
standard cubic metres per day, which is the same
Previous Current Change
Company Name level as 2009 when the company had started
Close(`) Price(`) (%)
production. Dhirubhai-1 and 3 (D1 and D3), the first
Essar Oil 67.05 59.75 -10.89
two of the 18 gas discoveries in the Krishna Godavari
United Brew 460.00 410.90 -10.67
basin KG-DWN-98/3 or KG-D6 block in the Bay of
Emami 392.35 357.55 -8.87
Bengal that have been put on production, and MA
Chambal Fert 91.50 84.00 -8.20
oilfield in the same area produced 40.35 mmscmd in
Power Finance 162.55 149.25 -8.18 the last week of November, according to the status
(BSE Mid-Cap) report filed by the company with the oil ministry
here.
Previous Current Change
Company Name • Sri Lanka's Regional Development Bank has selected
Close(`) Price(`) (%)
Emami 392.35 357.55 -8.87 financial technology firm Polaris Software Labs'
Chambal Fert 91.50 84.00 -8.20 'Intellect' core banking solutions (CBS) system for
Sintex Inds 93.00 85.65 -7.90 roll-out across its branch and service centre network.
Mcleod Russel 221.65 204.45 -7.76 US markets
Essar Ports 66.80 61.65 -7.71 U.S. stocks fell hard Monday as doubts about a recent
Europe accord and a lowered outlook by Intel Corp.
spurred a broad retreat after two weeks of gains.
The Dow Jones Industrial Average closed down 162.87
points, or 1.3%, to 12,021.39, trimming losses in the
last hour of trading after sinking 243 points. The S&P
500 Index shed 18.72 points, or 1.5%, to 1,236.47, with
energy companies and financial firms taking the
biggest losses of its 10 industry groups, all of which
closed lower. The Nasdaq Composite dropped 34.59
points, or 1.3%, to 2,612.26.
Keynote Capitals Institutional Research (research@keynoteindia.net) (+9122-30266000)

3. K E Y N O T E
INSTIT UT IONAL R ES EAR C H
India and Global Economic Calendar
Countries / Monday Wednesday Thursday Friday
Regions Dec. 12 Dec. 14 Dec. 15 Dec. 16
India IIP Data: -5.1% Monthly Inflation Weekly Inflation Data Forex Reserves Data
Weekly Supplement
of RBI
Consumer Price Index
US Federal Budget Producer price index Ex Food & Energy
(YoY & MoM)
Consumer Price Index
Current Account
(MoM)
Net long term
treasury International
capital
Industrial production
Philadelphia Fed
Manufacturing Survey
Global
Japan Industrial Canada Foreign
Hungary- Industrial
Production data and Investments in
output
Manufacturing Index Canadian securities
UK Unemployment
Switzerland-
Rate and Average
Industrial production
Earning growth rate
Germany- Purchasing
Managers Index
Manufacturing
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