Battered Indian stock market got a modest lift today from the US Federal Reserve’s steep interest rate cut and better-than-expected results from two major US investment banks - Goldman Sachs Group and Lehman Brothers Holdings. However, the market breadth was weak indicating that confidence is low among investors. In fact, the trend on the bourses was similar to the one witnessed yesterday, 18 March 2008, when the market pared large part of its intra-day gains.
The Sensex fell below 15,000 mark in late trade. The market breadth turned weak during the course of the trading session compared to a strong breadth earlier in the day. Traders refrained from building large positions ahead of a long weekend. The market remains closed on Thursday (20 March 2008) on account of Id-E-Milad and on Friday (21 March 2008) on account of Good Friday.
Sensex rose 161.37 points or 1.09% at 14,994.83. It hit a high of 15,465.81 in early trade. At day’s high, Sensex rose a massive 632.35 points. Sensex rose 96.62 points at the day's low of 14,930.08 hit in late trade.
The broader based S&P CNX Nifty was up 40.95 points or 0.9% at 4,573.95.
Concerns of marked-to-market losses for firms on their foreign exchange derivatives exposure, meltdown in global markets, lower-than-expected industrial production data for January 2008 and a surge in inflation created havoc on the bourses recently. Hike in short-term capital gains tax and alteration of tax treatment of the Securities Transaction Tax (STT) in Union Budget 2008-09 announced on 29 February 2008 had dented the sentiment earlier.
In today's trade, IT and auto stocks gained even as realty stocks fell. Satyam Computer Services and Tata Motors were major gainers from Sensex pack. The BSE Mid-Cap and Small-Cap indices declined.
The BSE Sensex clocked a turnover Rs 5766 crore today 19 March 2008 compared to Tuesday 18 March 2008's turnover of Rs 6,971.56 crore.
Nifty March 2008 futures were at 4592, at a premium of 18.05 points as compared to spot closing of 4573.95.
The NSE futures & options (F&O) segment turnover was Rs 46,365.04 crore, which was lower than Rs 47,532.30 crore on Tuesday, 18 March 2008.
As per the provisional figures on NSE, foreign institutional investors bought shares worth Rs 30.54 crore today, 19 March 2008.Domestic funds bought shares worth Rs 142.19 crore.
The market breadth was weak: on BSE 752 shares advanced as compared to 1,920 shares that declined. 37 shares remained unchanged.
The BSE Mid-Cap index declined 1.16% to 5,964.10. BSE Small-Cap index was down 1.94% at 7,222.20.
BSE Power index (down 0.27% to 2,984.07), BSE HealthCare index (up 0.72% to 3,671.26), BSE Consumer Durables index (down 1.38% to 3,564.04), BSE Oil & Gas index (up 0.06% to 9,717.56), BSE Metal index (up 0.43% to 13,498.55), BSE Bankex (up 0.02% to 7,495.26), BSE Realty index (down 2.14% to 7,087.70) , BSE FMCG index (up 0.55% to 2,142.40), BSE PSU index (up 0.49% to 7,189.29) underperformed Sensex.
BSE IT index (up 2.14% to 3,369.63), BSE Capital Goods index (up 1.25% to 13,095.72) and BSE Auto index (up 1.36% to 4,398.25), outperformed Sensex.
India’s largest private sector company in terms of market capitalisation and oil refiner Reliance Industries rose 0.64% to Rs 2,159.05. It came off from its high of 2,244.90.
Realty stocks declined. Unitech (down 3.5% to Rs 267.30), DLF (down 1.85% to Rs 623) and Indiabulls Real Estate (down 1.82% to Rs 443.25) edged lower.
IT stocks rose. Wipro (up 4.64% to Rs 376.60), Satyam Computer Services (up 5.24% to Rs 389.95) and Infosys (up 2.19% to Rs 1,341.90) edged higher. Tata Consultancy Services declined 0.89% to Rs 810.
Auto stocks rose. Mahindra & Mahindra (up 3.49% to Rs 658.40), Tata Motors (up 5.08% to Rs 650.45), Maruti Suzuki India (up 1.26% to Rs 822.75) edged higher. But India’s largest motorcycle maker by sales Hero Honda Motors declined 5.52% to Rs 649.70.
From the sensex pack, ITC (up 2.26% to Rs 187.40), Bharti Airtel (up 2.59% to Rs 777.75), HDFC Bank (up 3.11% to Rs 1,270.05) , Larsen & Toubro (up 2.72% to Rs 2,839) and Ambuja Cements (up 3.11% to Rs 122.85) were major gainers.
Hindalco Industries (down 4.09%t o Rs 154.95), Hindustan Unilever (down 2.49%t o Rs 225.30), Reliance Energy (down 1.72%t o Rs 1,206.50), ICICI Bank (down 0.21% to Rs 766.35) and Grasim Industries (down 1.35% to Rs 2,595.05) were key losers from the Sensex pack.
India’s second largest telecom services provider by sales Reliance Communications (RCom) rose 1.82% to Rs 506.45. The company is reportedly planning to set up WiMax networks across 50 countries in the next three years to move into the global telecommunication market. To get a headstart, the telecom major is planning to acquire a European WiMax operator in a $300-400 million (Rs 1,200-1,600 crore) deal.
Reliance Natural Resources clocked highest volume of 1.96 crore shares on BSE. Ispat Industries (1.26 crore shares), Reliance Petroleum (1.07 crore shares), Essar Oil (83.54 lakh shares) and Jaiprakash Associates (70.54 crore shares) were the other volume toppers in that order.
Reliance Capital clocked highest turnover of Rs 316.67 crore on BSE. Reliance Energy (Rs 303.23 crore), GSS America Infotech (Rs 259.01 crore), Reliance Industries (Rs 210.87 crore) and Reliance Natural Resources (Rs 203.87 crore) were the other turnover toppers in that order.
The Dow Jones Industrial Average surged 420.41 points or 3.51% at 12,392.66 on Tuesday, 18 March 2008. The Nasdaq Composite Index soared 91.25 points or 4.19% at 2,268.26.
European markets were in red. France’s CAC, Germany’s DAX and UK’s FTSE 100 were down by 0.79% to 1.28%.
In Asia on Wednesday, 19 March 2008, key benchmark indices in Hong Kong, Japan, South Korea, Taiwan and China were up by 1.42% to 2.53%.
The US Federal Reserve on Tuesday 18 March 2008 cut its key interest rate by three-quarters of a percentage point. Though the cut was smaller than some market participants had expected, investors focused on the likelihood of future cuts. Wall Street expects the Fed to cut interest rates further next month, but any future cuts are likely to be smaller.
US investment banks Goldman Sachs and Lehman Brothers posted better-than-expected quarterly earnings, providing evidence that bank profits were intact despite the deepening credit crisis.
Back home, reports that top Indian corporates have paid higher advance tax in the fourth installment of 15 March 2008, has raised expectations of good Q4 March 2008 results.
The BSE Sensex is down 6,211.94 points or 29.29% from its all time high of 21,206.77 hit on 10 January 2008.