Sensex settles above 14,400 level

The market was on a winning streak for the second straight day today, as buying momentum continued in index pivotals. It was firm in the first half of the day, but witnessed volatile movement in the second half, as some profit booking emerged at higher level.

All the sectoral indices on BSE logged gains. Shares from auto, banking, cement and metal lead the rally. There was plenty of action outside the index stocks, on strong buying momentum. Also the notable fact was the high daily turnover which crossed Rs 5,000 mark today on BSE indicating fresh buying. Earlier, market players were worried that liquidity might get sucked out from the secondary market, as huge Rs 8750 crore follow on public offer (FPO) of ICICI Bank opened on 19 June 2007.

The 30-share BSE Sensex rose 116.45 points to 14,411.95. It opened higher at 14,359.96 and surged to strike a high of 14,449.38 at 12:37 IST. At 14,449.38, Sensex had risen 153.88 points for the day. The strong opening was on the back of firm global markets. Sensex slipped to a low of 14,347.58 at 14:22 IST. It later recovered sharply from this level.

The S&P CNX Nifty rose 34.35 points to 4248.65. The Nifty June 2007 futures settled at 4242, a discount of 6.65 as compared to spot closing

The market sentiment was firm following good response to the follow-on public offer (FPO) of ICICI Bank. The FPO was subscribed 3.10 times by 16:00 IST today, 20 June 2007. The issue opened for subscription on Tuesday, 19 June 2007 and closes on Friday, 22 June 2007.

Turnover was very healthy today, crossing the Rs 5,000 crore mark. The total turnover on BSE amounted to Rs 5049 crore and the NSE F&O turnover was at Rs 41733.11 crore. The total turnover on 19 June 2007 was on BSE was Rs 4607 crore.

The market breadth was positive on BSE with close to 1.25 gainers for every loser: 1,457 shares advanced as compared to 1139 that declined, while 99 remained unchanged

The BSE Mid-Cap index rose 1.54% to 6,340.22, while the BSE Small-Cap index rose 0.85% to 7,420.44.

Among the Sensex pack, 23 advanced, while only 7 were trading in the negative territory.

Cement major Gujarat Ambuja Cements advanced 4.73% to Rs 118.35, on 18.35 lakh shares, and it was the top gainer from the Sensex pack. Other cement stocks ACC (up 0.78% to Rs 850) and Grasim (up 2.91% to Rs 2508) also gained. As per market talks, cement shortage may last till June 2009 and incremental output from new capacities won’t match demand till then.

The BSE Bankex was up 1.42% at 7,790.27, led by banking heavyweights ICICI Bank and State Bank of India.

ICICI Bank pared gains after striking a high of Rs 961.90. It rose 0.10% to Rs 945.30. Retail bidders would be allotted shares at a discount of Rs 50 per share to the issue price determined by the book-building process, in the ICICI Bank FPO. The issue size is Rs 8,750 crore. In addition, there is a green-shoe option under which the bank may allocate additional equity shares up to Rs 1,312.5 crore. The issue including the green-shoe option aggregates Rs 10,062.5 crore.

State Bank of India (SBI) surged 4.06% to Rs 1428, advanced for the second straight day. SBI is set to raise $225 million from the overseas market this year by issuing perpetual bonds. The overseas issue opened on Monday, 18 June 2007, and the bank is expected to price the bonds this week. It plans to raise a total of Rs 15,000 crore this year in the form of equity (tier-I) and debt (tier-II).

Other shares from the banking pack, Canara Bank (up 9.87% to Rs 275), Bank of India (up 5.86% to Rs 216), Bank of Baroda (up 1.43% to Rs 270), Federal Bank (up 3.13% to Rs 294.10), Kotak Mahindra Bank (up 2.87% to Rs 606), and Union Bank (up 2.73% to Rs 133.70), also gained.

Auto stocks extended early gains, rising for the second straight day. The BSE Auto index advanced 1.42% to 4,762.06.

Tata Motors (up 3.97% to Rs 689.80), Hero Honda Motors (up 0.20% to Rs 667.10), Bajaj Auto (up 2.05% to Rs 2161.65) and Maruti Udyog (up 2.84% to Rs 772.50) edged higher. The minister for petroleum and natural gas Murli Deora had said on Monday, 18 June 2007, that the government has no plan to hike the price of petrol or petroleum products. Recently, a senior oil ministry official had said the government was likely to review retail prices of petrol and diesel in mid-July 2007 to bring them in line with the recent rise in global oil prices.

Index heavyweight Reliance Industries (RIL) was up 0.28% to Rs 1732, on 5.50 lakh shares. As per reports, global oil giants including Shell, Exxon and Chevron are eyeing a stake in Reliance Industries’ overseas oil & gas assets. RIL recently hived off these assets into a separate company, Reliance Exploration and Production DMCC.

State run engineering major Bhel gained 2.11% to Rs 1435. As a result, the BSE capital goods index rose 1.30% to 11,505.59.

Engineering & construction major L&T was up 1.57% to Rs 2027. The company’s joint venture won an order worth Rs 610 crore for a residential building project in Dubai. The company made the announcement during market hours on Tuesday, 19 June 2007. The project is to be completed in 660 days from the date of commencement. As a result, the BSE capital goods index was up 1.25% at 11,499.91

Pharma major Ranbaxy Laboratories lost 1.81% to Rs 352.20, on 4.84 lakh shares, and was the top loser from Sensex pack.

IT pivotals were trading on mixed note. The BSE IT Index gained 0.08% at 4,887.29. TCS (down 1.17% to Rs 1147), Infosys (down 0.15% to Rs 1953.90), declined while Wipro (up 0.51% to Rs 524) and Satyam Computers (up 0.54% to Rs 471), advanced.

The rupee was trading at 40.815/825 per dollar, easing from Tuesday's (19 June 2007) 40.79/80. It is up about 8.5% this year on robust capital inflows. The stronger rupee has been impacting profit margins of software services companies that derive more than 60% of their revenue from overseas markets.

Hindustan Unilever (down 0.50% to Rs 188.05), (down 0.50% to Rs 188.05), Tata Steel (down 0.39% to Rs 606.50), and NTPC (down 0.36% to Rs 150.50), edged lower

Some star performers from small-cap and mid-cap pack included, Voltas (up 14% to Rs 110.10), South India Bank (up 11.73% to Rs 116.20), India Infoline (up 10.50% to Rs 737.80), Ess Dee Aluminum (up 10% to Rs 493.65), Vakrangee Software (up 10% to Rs 147.25), Gateway Distriparks (up 9.63% to Rs 199.70), Divi’s Labs (up 8.37% to Rs 6359.95), Shasun Chemicals (up 8.02% to Rs 144.15), Hindustan Construction (up 7.88% to Rs 105.40), Gati (up 7.51% to Rs 88). All of them surged on high volume.

Divi's Labs was the top traded counter on BSE with total turnover of Rs 164.80 crore followed by Reliance Capital (Rs 154.25 crore), Educomp Solutions (Rs 136.20 crore), India Infoline (Rs 120.70 crore) and State Bank of India (Rs 107.08 crore).

Metal stocks gained on renewed buying, with the BSE Metal Index gaining 1.07% to 10,724.96. Sterlite Industries India jumped 7.50% to Rs 601.90 after its American depositary shares made a strong debut on the New York Stock Exchange on Tuesday, 19 June 2007, ending 9.4% higher than the offer price of $13.44.

Hindustan Zinc galloped 7.51% Rs 722 on reports that government will offload residual 29.5% stake in the zinc major to reap Rs 8,381 crore from stake sale.

Blue Dart Express soared 10.20% to Rs 770.25 on market talks that DHL has agreed to an offer price of Rs 950 per share to acquire the remaining stake in the company. DHL currently holds a little over 81% in Blue Dart through DHL Express Singapore, while institutional investors collectively hold 10.34%. Individual investors have a stake of less than 5%. In a clarification issued in this ragard, Blue Dart said it was unaware of any such move by the parent.

Indian Hotels Company lost 1% to Rs 144.70. It reported a 70.6% spurt in net profit to Rs 134.52 crore in Q4 March 2007 as against Rs 78.85 crore in Q4 March 2007. Revenue rose 41.9% to Rs 505.16 crore in Q4 March 2007 as compared to Rs 355.93 crore in Q4 March 2007. Net profit jumped 75.4% to Rs 322.39 crore in the year ended March 2007( as against Rs 183.78 crore in the year ended March 2006. Revenue was up 42.4% to Rs 1544.51 crore in FY 2007 (Rs 1084.26 crore).

Indiabulls Real Estate jumped 4.52% to Rs 405 after it announced that its wholly owned subsidiaries had acquired two housing projects in Chennai.

HCL Technologies rose 0.12% to Rs 336.20 on media reports that the company is close to signing a multi-million dollar contract in the aerospace services space. Reports suggest that the deal in the aerospace services space will be worth $100 million. The stock touched high of Rs 346.95 in early trade

Bharat Earth Movers (BEML) rose 0.20% to Rs 1139.85 on reports that the company plans to raise Rs 400-Rs 450 crore through its forthcoming follow on public offer. BEML’s follow-on public offer (FPO) of 49 lakh equity shares of Rs 10 each opens for subscription on 27 June 2007. The issue will close on 3 July 2007. The company is yet to announce the price band for the FPO. Reports suggest that Bharat Earth Movers (BEML) had set a revenue target of Rs 5000 crore by 2013/14, but could reach there by 2011/12.

Suraj Stainless rose 5% to Rs 337.50 after the company announced on Tuesday, 19 June 2007, after market hours that it would consider issue of bonus shares in a board meeting on 26 June 2007.

After trading hours on Tuesday, 19 June 2007, market regulator Sebi directed 15 brokers and some market participants not to indulge in distortion of the derivatives market. A Sebi investigation of derivatives transactions on NSE for the period from January-March 2007 found that these entities were involved in manipulation in the futures & options segment.

Most the Asian markets were trading higher today, 20 June 2007, with Nikkei 225 index gaining on automakers Toyota Motor Corp. and Nissan Motor Co. Nikkei rose 0.26% at 18,211.68. All the European markets opened higher.

Hong Kong's Hang Seng (up 0.47% to 21,684.67), Taiwan's Taiwan Weighted (up 2.13% to 8,755.88), Malaysia’s KLSE Composite (up 0.69% to 1,386.27), edged higher. But China's Shanghai Composite lost 2.07% to 4,181.32.

South Korea's Kospi index dropped after hitting a fresh high intraday. It lost 1.33% at 1,783.79.

Wall Street posted small gains on Tuesday 19 June 2007, as investors found solace in declining Treasury yields. The Dow Jones Industrial Average (DJIA) rose 22.44 points, or 0.16%, to 13,635.42. The blue-chip index was buoyed largely by GE, which rose $1.22, or 3.2%, to $39.29.

Broader stock indicators also edged higher. The Standard & Poor's 500 index rose 2.65 points, or 0.17%, to 1,533.70, and the Nasdaq Composite index rose 0.16 point, or 0.01%, to 2,626.76.

As per the provisional data, FIIs were net buyers of Rs 171.71-crore equities, while domestic institutional investors (DIIs) sold shares worth a net Rs 32.98 crore on Tuesday, 19 June 2007.

Oil prices steadied on Wednesday, 20 June 2007, as traders waited to see if a threatened strike in Nigeria would cut its crude exports and whether gasoline inventories in the United States have built as forecast. London benchmark Brent crude edged 3 cents lower to $71.81 a barrel today.