Market scales new high on Fed move

The market started the week on negative note. It surged later amid global rally triggered by the US Federal Reserve announcing a larger-than-expected 50 basis points cut in fed funds rate to 4.75% from 5.25% on Tuesday, 18 September 2007. The move eased concerns about housing slump driving the world's largest economy into recession. Sensex advanced in 4 out of 5 trading sessions in the week.

BSE Sensex rose 960.43 points or 6.16% to 16,564.23 in the week ended Friday, 21 September 2007. Sensex hit an all time high of 16,616.84 on Friday.

The S&P CNX Nifty rose 319.55 points or 7% at 4,837.55 in the week. It hit an all time high of 4855.70 on Friday.

BSE Mid Cap rose 302.92 or 4.39% to 7,199.92 in the week. The BSE Small Cap index rose 322.54 points or 3.76% to 8,895.30 in the week.

The BSE Sensex lost 99.37 points or 0.64% at 15,504.43 on Monday, 17 September 2007. The market settled near the lowest point of the day, on fresh selling in late trade. The market had started the day on a firm note on buying interest in index pivotals. However it had lost ground in early afternoon trade with European markets which opened after Indian market, sliding in early trade.

The BSE Sensex advanced 164.69 points or 1.06% at 15,669.12 on Tuesday, 18 September 2007. The market surged in the second half of the trading session tracking recovery in European markets which started after Indian market. The market was range-bound in early afternoon trade. Asian markets were weak. With that rise, Sensex came out of its two-day loosing streak.

The 30-shares BSE Sensex surged 653.63 points or 4.17% at 16,322.75 on Wednesday, 19 September 2007. It was a record single day point rise in Sensex. The market soared to record closing with high turnover. It opened with a bang and kept on advancing during the course of the trading session as buying continued for index pivotals. Short covering also propelled the market higher to some extent. A global rally was triggered after the US Federal Reserve announcing a larger- than-expected 50 basis points cut in fed funds rate to 4.75% from 5.25% on Tuesday, 18 September 2007, easing concerns about housing slump driving the world's largest economy into recession.

The 30-shares BSE Sensex was up 25.20 points or 0.15% at 16,347.95 on Thursday, 20 September 2007. The market posted small gains after moving in and out of positive zone since mid-morning trade. It had opened on a firm note, but immediately slipped in the red on selling pressure. The market rebounded from lower level in mid-afternoon trade. Turnover on BSE remained high for the second day in a row. Most Asian markets, which opened before Indian markets, were firm. However European markets, which opened after Indian market, were subdued

Sensex surged 216.28 points or 1.32% at 16,564.23, an all time closing high, on Friday, 21 September 2007. The market surged towards the latter part of the trading session led heavy buying in index pivotals especially for Reliance group stocks. Both the niche indices BSE Sensex and S&P CNX Nifty struck all time highs. IT pivotals bounced back after initial slide

India’s largest private sector entity by market capitalisation and oil refiner Reliance Industries (RIL) rose 11.7% to Rs 2,274.40. It struck an all time high of Rs 2294. As per recent reports, RIL is foraying in shipbuilding and dredging business with two separate companies. As per another set of reports its subsidiary - Reliance Logistics (RLL) is planning to set up logistics parks within all the upcoming special economic zones (SEZs). The Reliance logistics parks will cater to the entire range of logistic requirements of the SEZs. RIL has reportedly paid Rs 650 crore in the June-September 2007 quarter. The tax outgo during the June-September period last year was about Rs 450 crore.

Bhel, the country’s largest power equipment maker in terms of sales rose 3.6% to Rs 1966.25. Bhel is reportedly looking at mergers and acquisition to fuel inorganic growth. Reports also suggest that the company is targeting a turnover of Rs 45,000 crore by 2012.

Bank and financial shares rallied on the reckoning that the Fed move could put pressure on RBI to loosen its monetary policy.

State Bank of India, the country’s largest banking entity by net profit jumped 9.39% to Rs 1,808.25. It topped the list of advance taxpayers, after it reportedly paid Rs 1,050 crore in the June-September 2007 quarter, which is nearly 50% more than the tax paid during the corresponding period last year.

India’s second largest bank by net profit, ICICI Bank jumped 6.4% to Rs 965.20. As per reports it paid Rs 450 crore advance tax for the June-September 2007 period. The bank had paid the same amount for the corresponding period last year.

Oil and Natural Gas Corporation, the country’s largest oil exploration company by revenue surged 10.7% to Rs 923.35 after its Chairman R.S. Sharma said the company may consider a bonus issue and a share split in the future. He did not give a time frame for bonus issue and stock-split.

Infosys Technologies, the nation’s second largest software services exporter lost 0.46% to Rs 1821.95, amid reports the firm is interested in acquiring UK-based Sage Group. Infosys has denied the reports further clarifying that it also isn't negotiating with Cap Gemini SA about buying any part of the company.

Maruti Suzuki India, the country’s top carmaker by sales vaulted 7.3% to Rs 929.55 on reports that company will set up an auto component park with Japan's Futuba Industrial Company. Maruti will hold a 49% stake in the joint venture. This will be Futuba’s first project outside Japan

India’s second largest cellular services provider by sales Reliance Communication, rose 6.6% to Rs 579.35 after its subsidiary Flag Telecom reportedly signed a five-year agreement with UK-based Vanco to increase its presence across 81 countries worldwide.

India’s top private sector utility company in terms of revenue Reliance Energy (REL) surged 14.3% to Rs 1009.60. As per reports, REL is scouting for coal mines in Indonesia, Australia, Africa and Mozambique and it sees infrastructure projects such as road and rail transport as key growth drivers. It also plans to raise $12.0-$12.5 billion in debt over the next seven to eight years to expand generation capacity nearly 16 times to 15,000 mega watt

India's largest engineering & construction firm by revenue Larsen & Toubro climbed 7.3% to Rs 2783.15 on reports that the company is eyeing a stake in Feedback Ventures, a leading integrated infrastructure services firm.

Magnum Ventures settled at Rs 48.70 on the BSE, a premium of 62.33% over the IPO price of Rs 30 on its debut on 20 September 2007. The scrip had debuted at Rs 36.95, a premium 23.16% over the IPO price of Rs 30.

Real estate firms like DLF (up 12.79% to Rs 749.85), Unitech (up 16.58% to Rs 329.15), Indiablls Real Estate ( up 13.88% to Rs 573.90) surged, on expectation of softer interest rates after US Federal Reserve cut the rate by half percentage point.

IT pivotals declined in the week on fresh selling as a steep interest rate cut by the US Federal Reserve on 18 September 2007, set the rupee on fire and it hit nine-year high above 40 per dollar on Thursday.

India’s third largest software services exporter Wipro lost 2.3% to Rs 439.90. Other IT pivotals Satyam Computers (down 2.7% to Rs 418.85), and TCS (down 0.75% to Rs 1014.95), also edged lower.

Sugar shares were star gainers during the week on frenzied buying after Agriculture Minister Sharad Pawar said the government plans to give more fiscal incentives to sugar mills.

As per reports, sugar mills may be allowed to produce ethanol directly from cane juice, instead of molasses, to lower dependence on sugar prices.

BSE decided to add a total of 100 scrips to trade-to-trade segment with effect from Friday, 21 September 2007. The stocks transferred to trade-to-trade segment include ABG Heavy Industries, Aksh Optifibre, Birla VXL, Hindoostan Spg. & Wvg. Mills, JCT, Kinetic Motor, Tide Water Oil (India), Vishal Exports Overseas, APEEJAY TEA, DCM Shriram Industries and Yash Papers, among others.

According to the Asian Development Bank (ADB), Asia's developing economies, the fastest growing nations in the world, will expand 8.3% in 2007 higher than the previous forecast of 7.6%. The ADB forecasts growth of 8.2% in 2008, up from an earlier prediction of 7.7%. The region grew 8.5% in 2006.

The government on Monday (17 September 2007) exempted four services used by exporters from service tax. These include port services provided for export, other port services provided for export, road transport services from inland container deport to port of export and rail transport services from inland container deport to port of export.

Commerce and Industry Minister Kamal Nath while addressing the annual conference of United Planters' Association of Southern India (UPASI) in Tamil Nadu on Monday (17 September 2007) proposed an alternative to the duty entitlement passbook (DEPB) scheme. The new scheme is already in the final stages and will be announced soon.

Communist Party of India-Marxist (CPI-M) general secretary Prakash Karat has asked the government to put the Indo-US nuclear deal on hold for at least six months. Karat addressed a party rally against the deal in New Delhi on Tuesday (18 September 2007) demanding a full-fledged discussion on the Indo-US nuclear deal in Parliament before proceeding with it.

The Planning Commission estimated economic growth at 8.5-9% in FY 2008 amid a deceleration in industrial growth in July 2007. Deputy chairman of the commission Montek Singh Ahluwalia termed the slow growth in the second quarter as "moderation" rather than a slowdown.

National Stock Exchange (NSE) has decided to launch a new index comprising of 50 stocks from the mid-cap segment. The index will be called Nifty Midcap 50. The index will be launched from 25 September 2007. Nifty Midcap 50 index has a base date of 1 January 2004 and a base value of 1000, NSE said.

The committee constituted by the government to look into Left front’s concerns over the Indo-US nuclear deal, will meet gain again on 5 October 2007. The meeting will be held at 16:00 IST on 5 October 2007. The committee had its second meeting on 19 September 2007. The stalemate over the deal continued after the meeting held on 19 September 2007.