Market ends just 17 points higher

The market edged higher today, tracking firm Asian markets. However, the Sensex pared a sizable part of the gains from an early afternoon surge. Cement shares flopped for the second successive day.

The 30-share BSE Sensex gained 17.64 points (0.14%), to settle at 12,902.63. The market had surged in the early-afternoon, and the benchmark Sensex jumped as many as 171.87 points, to 13,056.86 at 13:05 IST.

The S&P CNX Nifty gained 16.60 points (0.45%), to settle at 3,734.60. Nifty March 2007 futures were at 3,737 compared to the spot Nifty closing of 3,734.60.

The market-breadth was strong. Against 1,543 shares rising on BSE, 1,032 declined. Just 52 shares were unchanged. Gainers outpaced losers by a ratio of 1.49:1. Stock specific action was witnessed on Friday as well, even though the Sensex had lost 164 points.

BSE Small-Cap Index gained 66.60 points (1%), to settle at 6,317.65, while the BSE Mid-Cap Index rose 48.06 points (0.9%), to end at 5,276.50.

All sectoral indices of BSE except the BSE FMCG index ended in the green today. The BSE Capital Goods Index was the top gainer in percentage terms. It rose 143.60 points (1.6%), to settle at 8,745.90, and the BSE Auto index gained 54.43 points (1.1%), to settle at 4,898.08. BSE FMCG index lost 23.84 points or 1.4% to settle at 1,665.03.

The BSE clocked a turnover of Rs 3395 crore, compared to Friday (9 March 2007)’s Rs 4339 crore. Turnover on NSE’s derivatives segment declined sharply to Rs 26751.37 crore from Friday’s Rs 34939.39 crore.

The data on industrial production released today showed industrial production rose 10.9% in January 2007 from a year earlier, lower than a revised annual growth of 12.5% in December 2006. Output in November 2006 was an annual 15.4%, the highest in more than a decade. Manufacturing production, which represents more than 75% of industrial output, rose 11.6% in January 2007 from a year earlier, compared with a provisional 11.9% annual growth in December 2006.

The share markets in the Asia-Pacific rose on Monday, continuing a recovery after the recent slide as US jobs data reassured investors about the health of the world's biggest economy. Key benchmark indices in Hong Kong, Singapore, China, South Korea, Taiwan, Australia and Japan were up between 0.5 - 1.6%.

There has been a lack of direction on the domestic bourses over the past few days. A recovery of 282 points on 6 March 2007, was followed by a decline of 117 points on 7 March 2007. A solid surge of 470 points on 8 March 2007, was witnessed the next day (on 8 March 2007) which was followed by a decline of 164 points on 9 March.

Earlier, a sell-off gripped bourses in late February-early March 2007 due to setback in global markets, and disappointing Union Budget 2007-08 on 28 February 2007. A sharp fall of nearly 9% in Chinese stocks on 27 February 2007, had spooked global bourses in late February-early March 2007.

The Budget left a lot to be desired. While there was no across-the-board cut in the 10% corporate surcharge as expected, the dividend distribution tax was raised to 15% from 12.5%. The Budget also raised direct/indirect taxes for cement, construction and IT sectors.

The next trigger for the domestic bourses may come from global bourses. US Federal Reserve holds a two-day meet on 20-21 March 2007 to decide US interest rates. The latest US job data helped eased expectations of a possible rate cut by the Federal Reserve.

In today’s trade, cement shares retreated for the second day in a row after Commerce Minister Kamal Nath said on Friday cement makers had agreed not to raise prices for one year. Gujarat Ambuja Cements dropped 5% to Rs 104.35, ACC lost 4% to Rs 747 and Grasim shed 2.6% to Rs 2015. Brokerage CLSA downgraded cement makers ACC and Gujarat Ambuja Cements to "underperform", but rated Grasim and UltraTech as "outperform". According to CLSA, the latter two will be "relatively better off" due to higher volume growth potential, cost savings and lower exposure to the northern region.

Cigarette major ITC dropped nearly 4% to Rs 148.50. The stock declined on a heavy volume of 35.7 lakh shares on BSE.

Reliance Industries ended flat at Rs 1318. The stock came off the session’s high of Rs 1334.50. As per reports, the company had made two more gas discoveries off the country's east coast. The discoveries were made in gas-rich KG DG block in the Krishna-Godavari basin, and in NEC 25 block of the Mahanadi basin.

IPCL dropped 1.6% to Rs 264.10. Reliance Industries (RIL) set a ratio of one share of RIL for every five held in IPCL, to give shape to the merger of IPCL with RIL.

State-run Oil and Natural Gas Corporation rose 1.2% to Rs 791 on reports it was seeking 49% stake in Venezuela's San Cristobal oil block.

Engineering & construction major L&T gained nearly 3% to Rs 1525. The company is seen benefiting from the government’s thrust on the infrastructure sector in the Union Budget 2007-08.

Select telecom shares edged higher. Cellular Services major Bharti Airtel gained 2.6% to Rs 770. Idea Cellular rose nearly 2% to Rs 87.20. A massive 1.2 crore shares changed hands in the counter on BSE. The Idea Cellular stock debuted at Rs 92.40 on BSE on Friday (9 March 2007). It had settled at Rs 85.55 on the same day.

Software bellwether Infosys shed 0.4% to Rs 2114, whereas IT major TCS rose 2.3% to Rs 1240. Wipro had gained 1.8% to Rs 575.

ICICI Bank was up 2% to Rs 877. ICICI Bank has no plans for a stock-split, Chief Executive Officer KV Kamath said on Monday responding to market speculation.

Bhel rose 0.2% to Rs 2101.60. It came off the session’s high of Rs 2196.80. The company said on Monday its board had proposed altering its articles of association for a bonus issue.

Software firm Aftek jumped 5% to Rs 64.15, after the company said on Monday that Morgan Stanley & Co International had acquired 580,414 shares in the company, raising their holding to 5.43% from 4.77%.

Jet Airways jumped nearly 8% to Rs 583.90, after the company said on Monday it will add a direct flight to London from Ahmedabad, starting 3 April 2007.

Mahindra & Mahindra (M&M) rose 0.3% to Rs 735. M&M announced an open offer to acquire additional 20% stake in Punjab Tractors (PTL), at Rs 360 per share. The mandatory open offer was announced after M&M last week emerged the top bidder for acquiring 43.3% stake in PTL from private equity investor Actis and the Burman family.

Separately, M&M also made an offer to buy almost 4,80,000 shares, or 20% in Swaraj Automotives, in which Punjab Tractors owns 24.2% at Rs 244 per share. It also made an open offer to buy 20%, or 2.48 million shares in Swaraj Engines, where Punjab Tractors owns 33.2% stake, at Rs 151 per share.

Cadila Healthcare rose 0.6% to Rs 311, after the company said on Monday it had received approval from the US Food and Drug Administration to sell paroxetine tablets, an anti-depressant drug.

Battered real estate developers advanced for the second day in a row after cement firms decided on Friday not to raise prices for one year in government’s efforts to rein in inflation. Ansal Infrastructure jumped 5% to Rs 508.30, Unitech rose 5% to Rs 366.70, Mahindra Gesco Developers rose 5.6% to Rs 592, Parsvanath Developers rose 3.6% to Rs 245 and Sobha Developers gained 1.5% to Rs 723.50. Cement is a key input for real estate developers.

IFCI rose 1.5% to Rs 25.60, after ratings firm ICRA set a price band of Rs 275 - Rs 330 for an initial public offering (IPO). As per reports, the ICRA equity on offer also includes IFCI's holding of 1.86 million shares in the company.

Flawless Diamond gained 5% to Rs 79.65, after the company said on Monday it had received two export orders worth Rs 32 crore for its jewellery collection.

State-run Punjab National Bank gained 1.1% to Rs 435. The state-run bank said on Monday Goldman Sachs Investments (Mauritius) had acquired 20 lakh shares of the bank, raising its stake to 5.2% from 4.6%.

IVRCL Infrastructures rose 0.4% to Rs 277.50. The company said on Monday it had won orders worth Rs 313 crore.

Eicher Motors jumped 5% to Rs 327.65, after it declared an interim dividend of Rs 29 a share, including a one-time special dividend of Rs 25 per share.

Cement maker Rain Commodities rose 1.7% to Rs 120.40, after the company said on Monday it had raised its offer price for the acquisition of all assets of Canada's Great Lakes Carbon Income Fund from Canadian $11.60 to Canadian $13.25 per unit. The increase follows a competitive bid from US company, Oxbow Carbon & Minerals Holdings Inc., at Canadian (C)$13 per unit. In February 2007, Rain Commodities proposed to buy Great Lakes' assets at C$437 million in cash.

The US economy added 97,000 jobs in February, slightly below expectations, data showed on Friday, but jobs growth for previous months was revised up and the unemployment rate fell. US blue-chips inched up on Friday, helped by the jobs data, but the growing financial woes of firms operating at the riskier end of the mortgage market capped broader gains. Dow Jones Industrial Average gained 15.62 points, or 0.13% to settle at 12,276.32. The Nasdaq Composite Index ended nearly unchanged, at 2,387.55.

FIIs have resumed buying since the past three days after selling heavily since late-February 2007. FIIs were net buyers to the tune of Rs 115.80 crore on Thursday (8 March 2007), the day when the Sensex had surged 470 points. As per provisional data, they were net buyers to the tune of Rs 412 crore on Friday (9 March 2007), the day when the Sensex had lost 164 points.

Even as mutual funds are sitting on cash, thanks to collections from some of the recent new fund offers, they continue to press sales in equities. Mutual funds were net sellers to the tune of Rs 385 crore on Friday (9 March 2007), the day when Sensex had lost 164 points. They were net sellers to the tune of Rs 40 crore on Thursday (8 March 2007), the day when the Sensex had surged 470 points. They had pressed sales worth a net Rs 379.56 crore on Wednesday (7 March 2007), the day when the Sensex had lost 177 points in volatile trade.

Trading on BSE and NSE was extended by 45 minutes till 16:15 IST due to sun outage. This schedule is applicable till 19 March 2007.