Monday, October 18, 2010

Asia trading mixed, Dalal Street to open flat

Coal India IPO opens, pre-market session at BSE & NSE from today

Dalal Street opens to a mixed bag on Monday morning after volatile trading last week with global markets trading flat. Wall Street closed mixed with technology stocks moving up and Dow Jones closing in the red.

Asian Markets

Japanese Nikkei is trading flat with a marginal gain of 30 points while Australia is trading in the red.

Coal India IPO opens today

Coal India, the biggest IPO so far in the history of corporate India, will open on Monday to mop up Rs 15,000 crore to beat the Rs 11,700-crore offering from Anil Ambani's Reliance Power in January 2008.

The country is short of approximately 60 million tonnes of coal as rise in demand outpaces growth in domestic production. While production by CIL — which accounts for nearly 80-90 % of supplies — is rising at 7%, demand is increasing by about 10%.

We expect secondary markets to stay lacklustre due to the IPO as investors might withdraw from Dalal Street to apply for this IPO.

Stock specific action

Stock specific action is seen on the street today. Markets got the stick in the last two trading sessions as investors pulled out for the IPO. We expect markets to remain subdued but with volatility.