Sensex, Nifty settle at new peaks

The market continued its winning streak on strong buying momentum in index pivotals in the week ended 13 July 2007. Strong markets across the globe, fresh buying at higher levels, healthy inflow from foreign funds and domestic mutual funds and anticipation of robust set of Q1 June 2007 results triggered the rally on the bourses. Shares from the metal, capital goods, and real estate sectors advanced, while those from the IT sector slipped.

The BSE 30-share Sensex jumped 308.60 points in the week ended Friday, 13 July 2007, to settle at a record closing high of 15,272.72. Tractor and utility vehicle maker Mahindra & Mahindra replaced Hero Honda in the BSE Sensex from 9 July 2007.

The S&P Nifty added 119.70 points to record closing high of 4,504.55, in the week.

Trading for the week began on an upbeat note. The Sensex rose 81.61 points, or 0.55%, to 15,045.73, an all-time closing high, tracking firm Asian markets, on Monday 9 July 2007.

The market drifted lower on Tuesday, 10 July 2007, as caution prevailed ahead of Infosys’ earnings. The Sensex lost 36 points.

The market extended the fall on Wednesday 11 July 2007, tracking weak global markets and after IT bellwether Infosys Technologies slashed its EPS and revenue guidance for FY 2008 in rupee terms while announcing Q1 June 2007 results.

The market bounced back on Thursday, 12 July 2007. Firm global markets and strong industrial production data for May 2007 released by the government during trading hours, aided the surge. The Sensex jumped 181.42 to 15,092.04.

On Friday, 13 July 2007, the Sensex surged 180.68 points to 15,272.72, an all-time closing high, tracking strong global markets. It also struck an all-time high of 15,330.73 in intra-day trade

Metal shares advanced on strong buying momentum. Aluminiun and copper major Hindalco Industries galloped 13% to Rs 174.35 on hopes of consolidation in the global aluminium industry after global miner Rio Tinto launched today, 13 July 2007, a $38.1-billion offer to buy Canada's Alcan Inc. in an agreed deal to create the world's No. 1 aluminium producer, feeding expectations of more deals. Rio trumped a hostile bid by Alcoa Inc., now seen vulnerable to becoming a takeover target itself.

Sterlite Industries, Sesa Goa, Tata Steel, Hindustan Zinc and Sail also edged higher from the metal pack.

Bhel & L&T, bets on India’s infrastructure growth, struck all-time highs in the week. Both these firms are sitting on robust order books that provide a strong visibility of revenue growth.

Reliance Energy soared after the company said it plans to invest Rs 60,000 crore to add 15,000 mega watts (MW) of power over the next five years. This will boost the company’s generation capacity almost 17 times from 941 MW now. The stock was also boosted by market rumors that promoters may hike their stake in REL by 5%, taking it around to 40%

Index heavyweight Reliance Industries (RIL) gained 3.33% to Rs 1,768.50. The government has set up a Group of Ministers (GoM) to look into all aspects - production to pricing - of gas to be produced from newer areas, particularly in the deep sea. The GoM, headed by External Affairs Minister Pranab Mukherjee, would decide on production, utilisation, transportation and pricing of gas.

IT stocks saw some unwinding after IT bellwether Infosys Technologies dissapointed with results. Infosys' consolidated net profit as per Indian GAAP was down 5.6% to Rs 1079 crore in Q1 June 2007, from Rs 1,144 crore in Q4 March 2007. Revenue was almost unchanged at Rs 3,773 crore in Q1 June 2007 compared to Rs 3,772 crore in Q4 March 2007.

Infosys Technologies, Satyam Computers, Wipro and TCS all settled the week with losses.

GMR Infrastructure spurted 23.12% to Rs 911.95 after it bagged the tender for developing the Sabiha Gokcen International (SGA) airport in Istanbul, Turkey. SGA is the second airport in Istanbul besides Istanbul Ataturk airport.

BSE Realty index, launched by BSE on Tuesday, 10 July 2007, surged soon after its launch and it struck an all-time high of 8,041.37 on Friday, 13 July 2007. Two heavyweights in this index, Unitech and DLF, contributed to the rally.

Roman Tarmat settled at Rs 319.85 on BSE, a premium of 82.77% over the IPO price of Rs 175, on Monday, 9 July 2007. Roman Tarmat is a Mumbai-based infrastructure company constructing highways, runways and other civil work.

Ankit Metal & Power settled at a premium of 2.63% at Rs 36.95 on BSE on its debut on Tuesday, 10 July 2007, compared to the IPO price of Rs 36.

Meanwhile, industrial production data was released during the week. Industrial production rose an annual 11.1% in May 2007, lower than a downwardly revised annual growth of 12.4% in April 2007. The growth in April 2007 was revised downward from 13.6% reported earlier. The growth was an annual 11.7% in May 2006. Manufacturing production rose an annual 11.9% in May 2007 compared with provisional annual growth of 15.1% in April 2007.

As per reports, the committee on secretaries has given a go-ahead to public sector enterprises (PSEs) to invest a part of their cash reserves, estimated at over Rs 250000 crore, in mutual funds. Reports suggest that PSEs may be allowed to invest up to 10% of surplus cash in equity mutual funds

On Thursday, 12 July 2007, the government cleared 28 fresh SEZ proposals, including the Navi Mumbai project promoted by Reliance Industries chairman Mukesh Ambani, taking the total number of approvals to over 500.

On the same day, the government asked banks to reduce interest rates on loans given to exporters. The government will provide 2% grant to loans given to exporters. The concessions will cost the government Rs 800 crore this fiscal.

Inflation data released on 13 July 2007 showed a slight rise in inflation for the week ended 30 June 2007: 4.27% per annum as against 4.13% in the previous week due to costlier food and manufactured products. However, it was lower when compared to the annual inflation rate of 5.21% during the comparable week of the previous year.