Market declines in volatile trade

Market declined sharply in late trade in what was a choppy trading session. The market had surged in early trade following US Federal Reserve's interest rates cut by a quarter percentage point to 4.5% yesterday, 31 October 2007. It had slipped later into the red and moved between positive and negative territory for a better part of the trading session. Nifty had surpassed 6,000 mark and hit fresh all time high in early trade. The market breadth was weak.

Hindustan Unilever declined for the second day in a row. Reliance Industries declined sharply in late trade. Bharti Airtel plunged. ONGC surged. Realty, auto and FMCG stocks witnessed selling pressure. Capital goods and banking pivotals moved higher. Asian markets were mixed. European markets were weak.

The Sensex provisionally ended down 164.55 points, or 0.83%, to 19,673.44. It had opened strong with a upward gap of 292.24 points at 20,130.23. It soon hit a high of 20,204.21 in early trade. At day’s high of 20,204.21, Sensex had risen 366.22 points. It hit a low of 19,634.47 in late trade. At day’s low of 19,634.47 Sensex had lost 203.52 points.

The broader based S&P CNX Nifty was down 34 points, or 0.45%, to 5,866.65. It hit an all-time high of 6,011.95 in early trade. It took 24 trading sessions for Nifty to reach 6,000 after it had first hit 5,000 on 27 September 2007.

BSE clocked a turnover of Rs 11432 crore compared to Wednesday (31 October 2007)'s Rs 10,060.07 crore.

The market breadth was negative on BSE: 902 scrips advanced as compared to 1,818 that declined while 343 remained unchanged. 10 of the 30 Sensex stocks, gained.

India's largest private sector entity by market capitalisation and oil refiner Reliance Industries (RIL) declined 4.06% to Rs 2,669.50.

FMCG stocks were major losers. Hindustan Unilever plunged 6.7% to Rs 193.70. The stock had declined 5.21% to Rs 207.60 yesterday, 31 October 2007 after the company said its 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. HUL announced the results during trading hours yesterday. India's biggest cigarettes maker by sales, ITC, lost 4.21% to Rs 171.65.

Realty stocks plunged. Indiabulls Real Estate (down 6% to Rs 610.50), Unitech (down 3.75% to Rs 369.25) and DLF (down 2.19% to Rs 928) edged lower.

Auto stocks declined. Maruti Suzuki, India's biggest small-car maker by sales, declined 6.66% to Rs 1,002 after it reported 14.96% rise in sales in the domestic market to 64,258 vehicles in October 2007 over October 2006. Hero Honda Motors (down 6.45% to Rs 680), Bajaj Auto (down 2.55% to Rs 2,411), Tata Motors (down 2.07% to Rs 742) edged lower. Mahindra & Mahindra (up 1.16% to Rs 765.30) edged higher.

India's biggest cellular services provider in terms of market share, Bharti Airtel declined 5.82% to Rs 938 and was the top loser from Sensex pack on reports that Department of Telecommunications is planning to recommend an increase in the spectrum usage charges for operators that seek additional spectrum.

India's second largest cement maker by sales, ACC, lost 2.85% to Rs 1,046.80.

Ranbaxy Laboratories (up 1.99% to Rs 435.55) and Reliance Communications (up 2.08% to Rs 788) edged higher.

India's largest oil exploration firm by sales ONGC rose 6.45% to Rs 1,328.45.

India’s largest aluminium maker by sales Hindalco Industries lost 5.76% to Rs 185. India's second biggest power utility in terms of revenue Reliance Energy shed 5.13% to Rs 1,771.

Capital Goods stocks were the major gainers. India's largest engineering and construction company in terms of revenue Larsen & Toubro surged 3.24% to Rs 4,382. It hit an all-time high of Rs 4,670 today after it got engineering, procurement and construction order for the modernisation of Chatrapati Shivaji International Airport (CSIA). Bharat Heavy Electricals (up 0.64% to Rs 2,630) edged higher. Suzlon Energy (down 1.45% to Rs 1,945) edged lower.

Bank stocks rose after Fed rate cut. HDFC Bank rose 2.23% to Rs 1,690. It hit an all-time high of Rs 1,748 today. State Bank of India (up 2.65% to Rs 2,118) and ICICI Bank (up 3.42% to Rs 1,300) edged higher.

Among side counters, Parle Software (up 20% to Rs 1,001.50) Wheels India (up 20% to Rs 312), Dynamatic Technologies (up 20% to Rs 1,985.90), Damodar Threads (up 19.97% to Rs 41.75) edged higher.

NIIT Technologies (down 11.61% to Rs 295) and Visaka Industries (down 10.67% to Rs 67) edged lower.

The US Federal Reserve cut interest rates by a quarter percentage point to 4.5% yesterday, 31 October 2007 as widely expected. US markets advanced yesterday, 31 October 2007, after the Federal Reserve moderated some of investors fears about a sinking economy, stating that risks to the financial markets from the subprime crises have eased. The Dow Jones industrial average gained 137.54 points, or 1%, to 13,930.01. The S&P 500 index surged 18.36 points, or 1.20%, to 1,549.38, and the Nasdaq Composite index rose 42.41 points, or 1.51%, to 2,859.12.

European markets opened weak. France’s CAC 40 (down 0.62 % to 5,811.44), UK’s FTSE 100 (down 0.75% to 6,671.60) and Germany’s DAX (down 0.28% to 7,996.85) edged lower.

Asian markets were trading mixed today, 1 November 2007. Hong Kong's Hang Seng (up 0.45% at 31,492), Japan's Nikkei (up 0.79% at 16,870) edged higher. Singapore's Straits Times (down 0.06% at 3,803.56). South Korea's Seoul Composite (down 0.08% at 2,063.14) and Taiwan's Taiwan Weighted (down 1.17% at 9,598.23) slipped.

US crude oil prices surged over $1.60 to hit new record high of $96.21 on Thursday, 1 November 2007. The gains followed an unexpected sharp fall in US crude stocks, strong US economic data and further losses for the dollar after the Federal Reserve cut interest rates by a quarter percentage point.

As per provisional data, FIIs purchased shares worth a net Rs 198.74 crore, while domestic institutional investors (DIIs) were net buyers of shares worth Rs 444.25 crore on Wednesday, 31 October 2007.

The 30-share BSE Sensex rose 54.48 points, or 0.28%, to 19,837.99, on Wednesday, 31 October 2007. The broader based S&P CNX Nifty was up 31.9 points, or 0.54%, to 5,900.65 on that day.

Good Q2 September 2007 results and FII buying aided a solid surge on the bourses in October 2007. The BSE 30-shares Sensex gained 14.73% to 19,837.99 in one month to 31 October 2007.