Market Close: 20k crossed...time to book profits..

Support from the global front coupled with continues buying by the retail investors ensured that there was no looking back for the Indian indices. After a strong start the rally continued to zoom ahead and reached in the final leg of the 19,000 levels. Some signs of slow down were witnessed past the 19,950 levels but finally the 20,000 levels were breached in the final trading sessions. The index heavy weights like Reliance, Suzlon, SBI and L&T dominated the rally which was later joined by the small and mid caps. The gainers for the day were on the Banking, Reality and Consumer Durables counters. Strong rupee continued to weigh on IT. Tomorrow RBI will meet to discuss on interest rate. If interest rate is cut then it may restrain the rupee rally and help IT. European indices were firm.

Sensex closed at 19,977 higher by 735 points. Supporting the sensex were the gains in L&T (+10.20%), HDFC (+9.94%), BHEL (+7.33%), ONGC (+5.97%). Restricting the gains were the losses in Tata steel (-9.45%). M&M (-1.71%), Baja Auto (-0.62%) and Tata motors (-0.42%).

Jet Airways reported its September ended quarter results. The top line increased by 26% at Rs 2,254 cr against Rs 1,787 cr in the same quarter last year. The net profit for the quarter stood at Rs 28 cr vs a loss of Rs 55 cr in the September ended quarter last year. Higher crude seems to have impact the aviation industry in the country the most. Aviation Turbine Fuel (ATF) accounts for 40% of the cost for an airline. ATF is sold at 60% higher prices in the country compared to the international prices. PSU?s have monopoly in the marketing of ATF in the country. Aviation minister intends to break that monopoly. That could be in favor of the airline in the long run. Jet has the first mover advantage and is the only private airline in the country that can fly overseas apart from the state owned Air India. King fisher intends to go international by the end of March 2008 through its subsidy Deccan aviation where it has 46% stake. That could create some competition for the Jet. The industry is into transition mode. However for now it is largely affected by ATF but we think that industry is ready to take off. We like Spicejet in this space. Do read our note to get insights on this one.

Mahindra & Mahindra (M&M) ended a percent lower after the company announced its September ended quarter results. M&M?s net profit fell 26 % to Rs 285.95 cr compared with Rs 386.48 cr in the same quarter of previous year. Net sales increased by 12 % to Rs 2,871.55 cr for the quarter from Rs 2,563.42 cr for the same period last year. The slow down in the auto sales was expected with the hardened interest rates on auto loans. Festive season may see some growth in sales. Interest rate seems to be peaked off for now and seems to be directed down. Auto counter could see some relief.

Technically Speaking: Senses traded between an intra day high of 20,025 and low of 19,621. Advancers out numbered decliners. There were 1,558 advances against 1,196 declines. Support is at 19,700 levels. The volume for the day stood at Rs 8,884 cr. Markets seem to have over brought. Expect movement to be sideward and correction can not be ruled out at this stage.