Sensex garners 403 points on bargain hunting in pivotals

Buying in battered pivotals triggered solid rally on the bourses in late trade, with market closing near highest point of the day. However, the market breadth, indicating the overall health of the market remained negative. 24 shares from the 30-member Sensex pack advanced. Nifty March 2008 futures were at premium as compared to spot closing after a long time.

Most Asian markets, which opened before Indian market, were trading lower. European markets, which opened after Indian market, were in green.

The 30-share BSE Sensex surged 403.17 points or 2.63% at 15,760.52. The Sensex gained 441.07 points at day’s high of 15,798.42 hit in fag trade. Sensex had slipped 26 points at day’s low of 15,331.35 in early trade.

At current 15,760.52, Sensex trades at a PE multiple of 15.01 to 15.76, based on projected FY 2009 EPS of Rs 1000-to-Rs 1050 for 30 Sensex companies.

The broader based S&P CNX Nifty advanced 122.20 points or 2.64% at 4,745.80. Nifty March 2008 futures were 4,753.90, a premium of 8.10 points as compared to spot closing.

The Sensex is down 4526.47 points or 22.31% in calendar 2008 so far.

As per provisional data, foreign institutional investors (FIIs) sold shares worth Rs 358 crore today, 14 March 2008. Domestic institutional investors (DIIs) were net buyers of shares worth Rs 100.33 crore today.

Driven by the higher prices of food items and manufactured products, annual inflation rate based on the wholesale price index increased to 5.11% for the week ended 1 March 2008 as against 5.02% in the previous week. Inflation rate stood at 6.51% for the corresponding week in the previous year.

Finance minister (FM), P Chidambaram today said he expects the economy to maintain growth levels of above 8.5% in the coming years. FM also said in parliament that the present volatility in the local stock market reflected worldwide phenomena.

Despite the rally, the market breadth remained negative: On BSE 1,473 shares declined as compared to 1202 that advanced. 62 shares remained unchanged.

The BSE Mid-Cap index was up 0.85% to 6,583.45 and the BSE Small-Cap index rose 0.05% to 8,079.50. Both these indices underperformed the Sensex.

The total turnover on BSE slipped to Rs 5880 crore as compared to Rs 6,134.02 crore yesterday, 13 March 2008.

Turnover in NSE’s futures & options declined to Rs 40184.57 crore as compared to Rs 44869.49 crore yesterday, 13 March 2008.

All sectoral indices on BSE posted gains. The BSE Consumer Durables index (up 4.03% to 4,028.80), the BSE Power (up 2.79% to 3,149.48), the BSE Metal index (up 3.28% to 14,844.87), the BSE Realty index (up 4.76% at 7,712.83), the BSE Oil & Gas index (up 3.32% to 10,354.81), and the BSE Bankex (up 3.05% at 8,323.09), the BSE IT index (up 2.86% to 3,406.55), outperformed the Sensex.

The BSE Auto (up 0.08% at 4,539.07), the BSE Health Care index (up 1.28% at 3,820.64), the BSE Capital Goods index (up 2.03% at 13,579.94), The BSE TecK index (up 1.48% to 2,918.16), the BSE PSU index (up 1.83% to 7,527.22), the BSE FMCG index (up 2.37% at 2,189.31), underperformed the Sensex.

India’s leading private sector power utility company in terms of sales, Reliance Energy galloped 13.01% to Rs 1353 on 12.35 lakh shares. It was the top gainer from Sensex pack. The stock is the worst performing Sensex stock, declining 47.47% in calendar 2008 (till yesterday 13 March 2008).

Real estate shares staged a comeback after recent plunge. India’s largest real estate developer DLF jumped 8.15% to Rs 656.20 on huge volumes of 28.83 lakh shares. The stock replaced GlaxoSmithkline Pharma in the S&P CNX Nifty index from today. The BSE Realty index declined 44.33% in calendar 2008 (till yesterday, 13 March 2008).

Other real estate stocks Unitech (up 6.50% to Rs 283.25), Parsvnath Developers (up 3.57% to Rs 214.90), Indiabulls Real Estate (up 2.30% to Rs 505.25), and Housing Development & Infrastructure (up 2.04% to Rs 629), surged

India’s largest private sector company in terms of market capitalisation and oil refiner Reliance Industries rose 4.40% to Rs 2340.20 on 11.84 lakh shares. It moved in a range of Rs 2225 and Rs 2316.60 so far during the day. The stock is down 21.27% in the calendar year 2008 (till yesterday 13 March 2008).

IT pivotals advanced on fresh buying. Satyam Computer Services (up 4.61% to Rs 380.85), Infosys Technologies (up 2.74% to Rs 1370), TCS (up 3.76% to Rs 807.85), and Wipro (up 0.93% to Rs 368.40), logged gains.

Frontline banking shares gained despite the latest data showing a surge in inflation. ICICI Bank (up 4.30% to Rs 873.95), HDFC Bank (up 1.23% to Rs 1,312.25) and State Bank of India (up 0.78% to Rs 1,709) edged higher.

NTPC, the country’s largest power generation company in terms of sales, surged 4.34% to Rs 194.80 on reports the company proposes to set up a 2000-megawatt project in joint venture with Andhra Pradesh State Power Generation Corporation.

Metal stocks gain as government cleared new mining policy. JSW Steel (up 4.33% to Rs 936), Hindalco Industries (up 4.78% to Rs 182), Sterlite Industries (up 6.66% to Rs 780), Tata Steel (up 2.45% to Rs 714.90), edged higher.

The implementation of National Mineral Policy 2008 would be likely to attract foreign direct investment of $250 million per annum in the mining sector by the end of five years

Jaiprakash Associates soared 7.80% to Rs 236. The stock replaced Bajaj Auto in the BSE 30-share Sensex pack from today.

Bajaj Holdings & Investment settled at Rs 775 in highly volatile trade after its auto and the financial services businesses were spun off effective today, 14 March 2008. As per the restructuring, Bajaj Holdings, earlier known as Bajaj Auto, has 30% in Bajaj Auto and Bajaj Finserv, both to be listed separately in due course. The stock hit a high and low of Rs 1143.80 and Rs 720 respectively.

Bharti Airtel, the country’s top listed cellular services provider lost 3.26% to Rs 753 on 6.31 lakh shares. It was the top loser from Sensex pack.

Auto stocks were subdued. Mahindra & Mahindra (down 2.57% to Rs 644) and Maruti Suzuki India (down 0.32% to Rs 837.10) slipped on profit booking.

Reliance Natural Resouces was the top traded counter on BSE with turnover of Rs 305.11 crore followed by Reliance Petroleum (Rs 274.47 crore), Reliance Industries (Rs 271.37 crore), GSS America Infotech (Rs 223.33 crore), and Bajaj Holdings & Investment (Rs 197.02 crore), in that order.

Reliance Natural Resouces led volume toppers on BSE clocking volumes of 2.88 crore followed by Reliance Petroleum (1.72 crore shares), Ispat Industries (1.39 crore shares), Power Hgrid Corporation of India (85.84 lakh shares), and Essar Oil (71.04 lakh shares), in that order.

Among the side counters, English Indian Clays (up 20% to Rs 1739.25), Dalmia Ceemnets (up 16.66% to Rs 340), Educomp Solutions (up 15% to Rs 3725), Tata Sponge (up 14.69% to Rs 265.90), and Khaitan Electricals (up 18.18% to Rs 70.85), surged

Nahar Capital (down 20% to Rs 77.50), Artson Engineering (down 16.06% to Rs 36.85), and ABC Paper (down 13.39% to Rs 36.55), slumped

Pyramid Saimira Theatre gained 6.12% to Rs 315.40 after the company said its unit has entered into a partnership with Europe's Spize TV, a direct-to-home platform, for content and new channels. Spize TV is a pan-European DTH platform offering Asian and niche content.

Escorts slipped 0.16% to Rs 91.60 after the company said foreign fund FID Fund Mauritius has acquired a further 0.39% stake in the company, raising its total holding in the firm to 5.12%

Jindal Stainless moved up 1.47% to Rs 131 after the company said it will invest Rs 500 in its Indian unit and $100 million in its Singapore unit in the next 2-3 years.

GHCL plunged 12.20% to Rs 77 after the company said its board will meet on, 24 March 2008, to give in-principle approval for restructuring of the company..

Shares of three aviation firms slipped on reports the domestic aviation industry is likely to post losses in excess Rs 2,800 crore during the fiscal year 2007-08. SpiceJet (down 2.56% to Rs 51.30), Jet Airways (down 4.88% to Rs 599.85) and Jagson Airlines (down 1.13% to Rs 21.90) edged lower. However, Deccan Aviation rose 0.69% to Rs 131.70.

Aurobindo Pharma rose 0.66% to Rs 290 after the company received approval from the US Food and Drug Administration for its antibiotic minocycline hydrochloride in capsule forms.

The next trigger for the market would come from the figures of advance tax payment by corporates for the fourth installment, which falls due on 15 March 2008.

Another major trigger for the market is outcome of the US Federal Reserve meeting on 18 March 2008 to review interest rates. A cut in interest rate, as expected by the street may provide some support to the markets. Fed Chairman Ben Bernanke had signaled a readiness to cut interest rates again to prevent further damage to the weak US economy, even as he took note of rising inflation risks.

European markets were higher. Key benchmark indices from United Kingdom (up 0.25% to 5,706.80), France (up 0.08% to 4,634.05), and Germany (up 0.42% to 6,527.69), gained.

Most Asian markets were trading lower. Hong Kong's Hang Seng (down 0.29% at 22,237.11), Japan's Nikkei (down 1.54% at 12,244.48), Seoul Composite (down 0.95% at 1,600.26), Taiwan Weighted (down 0.60% at 8,161.39) and Shanghai Composite (down 0.22% at 3,962.67) edged lower after early rise.

However Singapore’s Straits Times index rose 1.19% at 2,839.01

US markets reversed early losses on Thursday, 13 March 2008, as S&P predicted an end to subprime mortgage writedowns. The early fall came after lower than expected retail sales and reports that another hedge fund may collapse. The Dow Jones industrail average gained 35 points to 12,145. The Nasdaq rose 19 points at 2.263; while the S&P 500 gained 6 points to 1,315.

US crude for April delivery fell 58 cents to $109.75 today, 14 March 2008 a barrel after hitting a record of $111. London Brent crude for April dropped 54 cents to $107