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Wednesday, October 31, 2007

Sensex gains 54 points ahead of Fed meet


The market ended with modest gainers as investors refrained from taking large positions ahead of US Federal Reserve meeting later in the day on interest rates. Volatility was high. Up about 170 points at one point of time in early afternoon trade, Sensex suddenly slipped into the red in mid-afternoon trade before recovering from lower level instantly. The market breadth was even, easing from a strong breadth earlier during the day.

Hindustan Unilever plunged after announcement of Q3 September 2007 results during trading hours. Capital goods stocks lost ground. IT stocks drifted lower. Metal stocks edged higher. Asian markets were mixed. European markets were in the green. Bank of Japan, today, kept interest rates unchanged at 0.5%.

The 30-share BSE Sensex ended with a gain of 54.48 points, or 0.28%, to 19,837.99. It had opened marginally higher at 19,827.40 and slipped to a low of 19,735.21 shortly. It rebounded from that low. Sensex hit a high of 19,984.13. At day's high of 19,984.13, Sensex had risen 200.62 points.

The broader based S&P CNX Nifty was up 31.9 points, or 0.54%, to 5,900.65

Q2 September 2007 results were decent to strong, which aided the solid surge on the bourses this month.

The market breadth was almost even on BSE: 1,369 scrips advanced as compared to 1,346 that declined while 361 remained unchanged. 17 of the 30 members of the Sensex pack were trading with gains.

The BSE Mid Cap index rose 1.08% to 8,134.92 and BSE Small cap index rose 1.58% to 9,796.86. Both these indices outperformed Sensex.

BSE Auto index (up 0.5% to 5,507.70) BSE Oil & Gas index (up 1.15% to 11,658.48), BSE Bankex (up 1% to 10,655.33), and BSE Metal (up 3.37% to 17,884.93), outperformed Sensex.

BSE Capital Goods index (down 1.06% to 19,795.32), BSE Realty index (down 0.14% to 10,502.77), BSE IT index (down 0.62% to 4,618.72) underperformed Sensex.

The NSE F&O turnover was Rs 71,090.73 crore today as compared to Rs 89,601.31 crore Tuesday, 30 October 2007.

Nifty November 2007 futures contract was trading at 5,924, at a premium of 23.35 points or 0.39% over spot price of 5,900.65.

BSE clocked a turnover of Rs 10020 crore compared to Tuesday (30 October 2007)'s Rs 10,980.56 crore.

Reliance Communications (RCom) rose 0.67% to Rs 771.95. RCom's net profit rose 73.53% to Rs 801.24 crore on 17.27% rise in total income to Rs 3,329.21 crore in Q2 September 2007 over Q2 September 2006. The company announced the results during the market hours today.

Shares of India's largest aluminium producer Hindalco Industries surged 1.6% to Rs 196.30 after it reported 7.56% rise in net profit to Rs 642.80 crore on 6.83% growth in total income to Rs 5069.50 crore in Q2 September 2007 over Q2 September 2006. The company announced the results during the market hours today.

Hindustan Unilever (HUL) declined 5.21% to Rs 207.60 and was the top loser from Sensex pack. The company's net profit declined 21.63% to Rs 408.06 crore on 9.72% rise in total income to Rs 3,470.49 crore in Q3 September 2007 over Q3 September 2006. The company said the results are not comparable to the extent of amalgamation of Modern Foods (India) and its subsidiary with the company. HUL announced the results during the market hours today.

Tata Motors rose 1.25% to Rs 757.70. Tata Motor's net profit rose 19.27% to Rs 526.84 crore on 1.09% rise in total income to Rs 6,743.31 crore in Q2 September 2007 over Q2 September 2006. The company announced the results during the market hours today.

Capital goods stocks declined after yesterday’s surge on profit booking. Bharat Heavy Electricals (down 1.55% to Rs 2,613.35), Larsen & Toubro (down 1.81% to Rs 4,344.55) and Suzlon Energy (down 0.34% to Rs 1,973.65) edged lower.

IT stocks declined as the Indian rupee inched towards a 9-½ year high on expectations foreigners will keep buying local shares and in anticipation of a US rate cut later in the day. Infosys (down 0.66% to Rs 1,839.10), Satyam Computer services (down 0.38% to Rs 477.65) and Wipro (down 0.96% to Rs 504.80) edged lower.

India's largest software services exporter Tata Consultancy Services (TCS) slipped 1.01% to Rs 1,037.90 on high volumes of 16.48 lakh shares, after three block deals were executed in early trade on BSE at discount to the then ruling market price. Two block deals of 3.01 lakh shares were executed at average price of Rs 1021 per share on BSE by 10:11 IST. A third deal of 3.60 lakh shares was struck at Rs 1023 per share at 10:12 IST.

Metal stocks climbed. Tata Steel (up 0.66% to Rs 904.50),Sterlite industries (up 0.44% to Rs 1,023) and Hindalco Industries (up 1.45% to Rs 196) edged higher.

India's second largest power utility by revenue Reliance Energy jumped 4.34% to Rs 1,866.80 and was the top gainer from Sensex pack. Its board yesterday, 30 October 2007, approved a proposal to transfer its infrastructure projects to a separate wholly owned subsidiary.

India's largest drug maker by sales Ranbaxy laboratories (up 2.94% to Rs 427.05) edged higher. Ranbaxy Laboratories after market hours yesterday, 30 October 2007, said it has secured a favourable verdict in its patent case against (Pfizer) Warner-Lambert's European Patent 409 281 (281), invalidating all relevant claims of this patent. The drug has annual sales of $137 million, Ranbaxy said in a filing with the Bombay Stock Exchange (BSE).

India’s biggest oil exploration firm by market capitalisation Oil and Natural Gas Corporation rose 2.32% to Rs 1,247.90 after it reported good Q2 results. ONGC's net profit rose 22.10% to Rs 5097.48 crore on 9.60% rise in net sales to Rs 15413.92 crore in Q2 September 2007 over Q2 September 2006. The results were announced after market hours on Tuesday, 30 October 2007.

India’s top listed cellular services provider by market capitalisation Bharti Airtel moved up 0.69% to Rs 1,006.60 after it reported a surge in net profit in Q2 September 2007 over Q2 September 2006. Bharti Aritel reported 82% rise in net profit to Rs 1619.15 crore on 44.94% rise in sales to Rs 6059.89 crore in Q2 September 2007 over Q2 September 2006. The results were announced during market hours today, 31 October 2007.

India’s largest private sector entity in terms of market capitalisation and oil refiner Reliance Industries was up 0.43% to Rs 2782.55.

HDFC Bank (up 2.15% to Rs 1,653.10) and NTPC (up 2.33% to Rs 239.40) edged higher.

Cipla declined 1.3% to Rs 178.75.

Side counters, Apcotex Industries (up 20% to Rs 47.70), Jindal Steel & Power (up 24% to 11,780), Fenoplast (up 20% to Rs 30.60, Atlas copco India (up 20% to Rs 1,184.30), Bombay Rayon Fashions (up 25.47% to Rs 284), soared.

Tulip Star Hotels (down 9.8% to Rs 103.55), Empee Sugars (down 9.77% to Rs 11.91) edged lower.

Reliance Natural Resources topped volume charts on BSE, clocking volumes of 2.82 crore shares on BSE. The stock gained 3.77% to Rs 119.85. Tata Teleservices (Maharashtra) slipped 1.09% to Rs 45.40 on 2.80 crore shares. It was the second most traded counter on BSE. Reliance Petroleum gained 6.10% to Rs 247.80 on volumes of 1.21 crore shares and stood third in terms of volumes. Nagarjuna Chemicals & Fertilisers occupied the fourth spot clocking volumes of 1.21 crore shares. The stock rose 4% to Rs 62.55. Power Grid Corporation of India advanced 2.05% to Rs 149.60. It notched volumes of 1.17 crore shares and secured fifth position.

Reliance Industries clocked highest turnover of Rs 651.42 crore on BSE. Reliance Petroleum clocked the second highest turnover of Rs 560.35 crore, followed by Jindal Steel & Power (Rs 422.52 crore), Reliance Energy (Rs 352.49 crore) and Reliance Natural Resources (Rs 338.12 crore) in that order.

US Federal Reserve holds a policy meeting later in the day to consider interest rates. Analysts speculate that Fed would cut rates by 25 basis points.

The Reserve Bank of India (RBI) in its mid-term review of the annual monetary policy yesterday, 30 October 2007, hiked cash reserve ratio (CRR) by a steep 50 basis points to 7.5%. CRR is the proportion of cash that the banks have to keep with RBI. The central bank left the reverse repo rate, the rate at which it absorbs excess cash from banks, unchanged at 6%. The bank rate, too, was unchanged at 6%%. The CRR hike which come into effect from 10 November 2007, will suck out Rs 16,000 crore from the banking system.

The bad news for the industry and the consumer is contrary to some expectations, interest rates are unlikely to soften in the near term.

European markets were in the green. France’s CAC 40 (up 0.26% to 5,818.91),UK’s FTSE 100 (up 0.22% to 6,673.70) and Germany’s DAX (down 0.21% to 7,994.33) edged higher.

Asian markets were mixed today, 31 October 2007. Hang Seng (down 0.9% at 31,352.58) and Taiwan's Taiwan Weighted (down 0.48% at 9,711.37) edged lower. South Korea's Seoul Composite (up 0.61% at 2,064.85),Singapore's Straits Times (up 0,.19% at 3,805.70) and Japan's Nikkei (up 0.52% at 16,737.63), edged higher.

Q2 September 2007 results announced so far have been decent to strong, which have aided a solid surge on the bourses this month.