Sensex up 1023 points from recent low

The key benchmark indices ended higher extending yesterday’s gains. Market had surged in early afternoon trade when the BSE Sensex surpassed 16,000 mark. It immediately fell below that level.

IT stocks rose. Capital goods, power stocks declined. Reliance Industries gained. Wipro and Satyam Computer Services were major gainers from the Sensex pack. Bharat Heavy Electricals (Bhel) declined after announcing provisional results for the year ended March 2008. Reliance Energy and Mahindra & Mahindra were other major losers from Sensex pack. The market breadth was negative compared to strong breadth at the onset of the trading session. BSE Mid-Cap and Small-Cap indices declined.

European markets which opened after Indian market, were subdued. France's CAC, Germany's DAX and UK's FTSE 100 were down by between 0.43% to 0.76%. Asian markets which opened before Indian market edged higher after a US jobs indicator raised hopes of a milder recession than previously feared in the world's biggest economy.

The 30-share BSE Sensex gained 82.15 points or 0.52% at 15,832.55. At the day’s high of 16002.73, the Sensex rose 252.33 points in early afternoon trade. At the day’s low of 15,699.21 Sensex lost 51.19 points in early trade.

The broader based S&P CNX Nifty gained 17.4 points or 0.37% at 4,771.60.

From recent low of 14,809.49 on 17 March 2008 Sensex has recovered 1023.06 points or 6.9% at current 15,832.55. From the recent high of 16,371.29 on 28 March 2008, Sensex is off 538.74 points or 3.29%

BSE clocked a turnover of Rs 4789 crore today 3 April 2008 compared to a turnover of Rs 4,955.40 on 2 April 2008.

As per the provisional figure on NSE, foreign institutional investors were net sellers of Rs 393.21 crore in Indian equities while domestic funds were net buyers of shares worth Rs 265.39 crore.

The market breadth was negative: On BSE 1215 shares advanced as compared to 1409 that declined. 63 shares remained unchanged.

The BSE Mid-Cap index down 0.4% to Rs 6,387.23 and BSE Small-Cap index down 0.91% to 7,840.29.

Nifty April 2008 futures were at 4785, at a premium of 13.40 points as compared to spot closing of 4771.60.

The NSE's futures & options (F&O) segment turnover was Rs 32,513.16 crore, which was lower than Rs 34,170.35 crore on Wednesday, 2 April 2008.

BSE IT index (up 3.31% to 3,764.91), BSE Oil & Gas index (up 1.97% to 10,531.88), BSE FMCG index (up 1.12% to 2,344.68), BSE HealthCare index (up 0.64% to 3,887.73), BSE Metal index (up 0.53% to 13,588.76) outperformed Sensex.

BSE Realty index (up 0.3% to 7,523.32) , BSE Bankex (down 0.02% to 7,820.62), BSE PSU index (down 0.54% to 7,347.78), BSE Auto index (down 1.07% to 4,490.94), BSE Consumer Durables index (down 1.53% to 3,857.74), BSE Capital Goods index (down 2.1% to 13,214.73) and BSE Power index (down 2.6% to 3,055.57) underperformed Sensex.

IT stock surged on hopes a US recession might not be deep as feared. Wipro (up 5.04% to Rs 435.30), Infosys (up 2.68% to Rs 1,521.65), Tata Consultancy Services (up 4.13% to Rs 885.95) and Satyam Computer Services (up 5.11% to Rs 428.05) edged higher. The US private sector added 8,000 jobs in March 2008, according to a report on Wednesday by ADP Employer Services, surpassing economist expectations. IT firms derive more than half of their revenue from exports to US.

Capital goods stocks declined. India's biggest power equipment maker by sales Bharat Heavy Electricals declined 5.27% to Rs 1754.95. Based on provisional figures, the company today reported 16.56% growth in net profit to Rs 2815 crore in the year ended March 2008 over the year ended March 2007. India’s largest engineering firm by sales Larsen & Toubro declined 0.54% to Rs 2,850.05.

Power stocks were mixed. India’s largest power generation firm by sales National Thermal Power Corporation rose 0.1% to Rs 194.25 after the company formed a joint venture company with Uttar Pradesh Rajya Vidyut Utpadan Nigam (UPRVUNL) under the name Meja Urja Nigam for setting up a power plant of 1320 megawatt in Allahabad district in the state of Uttar Pradesh. NTPC and UPRVUNL will each hold 50% stake in the share capital of the joint venture company.

Reliance Energy (down 3.32% to Rs 1,189.45), Power Grid Corporation of India (down 0.8% to Rs 99.20), Tata Power Company (down 2.34% to Rs 1,159.30). However Reliance Power rose 1.06% to Rs 329.60.

India’s largest private sector company in terms of market capitalisation and oil refiner Reliance Industries rose 2.14% to Rs 2,393.75.

India’s largest commercial bank State Bank of India down 0.81% to Rs 1,639.10. The bank said on Wednesday, 2 April 2008, it had finalised issue of bonds to raise 12 billion yen ($117.7 million). The bonds will mature in five years and carry a coupon of 3.36%, it said in a statement to the Bombay Stock Exchange. The bonds will be issued on 8 April 2008, the bank said.

India’s largest tractor maker by sales Mahindra & Mahindra declined 2.29% to Rs 651. A consortium of Mahindra & Mahindra and private equity firm ICICI Venture Funds has signed an agreement to buy Italian gear manufacturer Metalcastello. Financial details of the deal, which is subject to approvals, were not disclosed.

Hindalco Industries (up 2.52% to Rs 170.95), Jaiprakash Associates (up 0.47% to Rs 233.40), Tata Steel (up 2.11% to Rs 659.60), ONGC (up 0.84% to Rs 1,019.55), Hindustan Unilever (up 3.2% to Rs 243.35) and ICICI Bank (up 0.47% to Rs 787.90) edged higher from the Sensex pack.

Maruti Suzuki India (down 2.92% to Rs 788.50), Grasim Industries (down 2.15% to Rs 2,560.95) Tata Motors (down 1.48% to Rs 628.70), HDFC (down 1.11% to Rs 2,442.90) and Bharti Airtel (down 0.36% to Rs 821.05) edged lower from the Sensex pack.

Gammon Infrastructure Projects (GPIL) settled at a discount of 5.45% to Rs 157.90 on BSE on its debut today. The company had priced the initial public offer (IPO) at Rs 167 – at the lower end of the Rs 167 - Rs 200 price band.

Indiabulls securities clocked highest volume of 1.8 crore shares on BSE. Reliance Natural Resources (1.4 crore shares), Ispat Industries (1.33 crore shares), Reliance Petroleum (1.17 crore shares) and Essar Oil (85.52 lakh shares) were the other volume toppers in that order.

Reliance Capital clocked a highest turnover of Rs 250.41 crore on BSE. GSS America Infotech (Rs 246.02 crore), Bharat Heavy Electricals (Rs 219.88 crore), Reliance Petroleum (Rs 198.01 crore) and Reliance Industries (Rs 195.67 crore) were other turnover toppers in that order.

In Asia, the key benchmark indices in Hong Kong, Japan, South Korea, Singapore and China were up by between 1.04% to 2.94%.

US stocks declined on Wednesday after Federal Reserve Chairman Ben Bernanke said a recession was possible, spurring profit-taking a day after the market's biggest rally in two weeks. The Dow Jones industrial average shed 48.53 points, or 0.38%, at 12,605.83. The Standard & Poor's 500 Index lost 2.65 points, or 0.19%, at 1,367.53. The Nasdaq Composite Index was down 1.35 points, or 0.06%, at 2,361.40.

Prospects of further monetary tightening by the Reserve Bank of India (RBI) following a surge in inflation is a cause for concern at a time when the already high rates are pinching the domestic industry. The surge in inflation has triggered fears that RBI my raise cash reserve ratio (CRR). An increase in CRR would suck out liquidity immediately pushing up the cost of funds and thereby curbing demand.

The next major trigger for the market is Q4 March 2008 results of India Inc. As per market talks IT bellwether Infosys may issue muted guidance for the year ending March 2009 in the backdrop of a slowdown in the US economy. Infosys unveils Q4 results on 15 April 2008.

The market sentiment remains edgy as Indian companies are sitting on potential losses on account of the forex derivative transactions they undertook last year. A steep decline in the value of the US dollar against the Japanese Yen and the Swiss Franc has hit Indian corporates which have used these two currencies (Yen and Franc) extensively to swap their rupee denominated debt.

BSE Sensex had risen 123.78 points or 0.79% at 15,750.40 on Wednesday on positive cues from the global markets.