Ranbaxy, Infosys tumble

Stocks ended volatile session with losses for the second straight day on sustained selling in IT and select blue-chip stocks. Ranbaxy Labs suffered over 10% on high volumes. Fresh selling at day’s high in mid-afternoon trade derailed a sustained recovery from lower level witnessed earlier in the day. Volatility was high in the later half of day. The market breadth was weak.

IT pivotals tumbled hit by sharp fall in American depository receipts (ADRs) on the New York Stock Exchange (NYSE) on Friday, 11 July 2008.

European stocks surged, boosted by a US plan to rescue embattled mortgage finance companies Fannie Mae and Freddie Mac and by a fresh surge of acquisition activity. Key benchmark indices in UK, France and Germany rose by 1.22% and 1.77%.

The 30-share BSE Sensex was down 139.34 points or 1.03% at 13,330.51. The Sensex gained 89.51 points at day's high of 13,559.36 hit in mid-afternoon trade. At the day’s low of 13,269.62, the Sensex slipped 200.23 points in late trade.

The S&P CNX Nifty fell 9.03 points or 0.23% to 4039.70. Nifty July 2008 futures were at 4045, a premium of 5.3 points as compared to spot closing.

The BSE Sensex is down 6956.48 points or 34.29% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 7876.26 points or 37.14% away from its all-time high of 21,206.77 struck on 10 January 2008.

As per provisional data, foreign funds sold shares worth a net Rs 436.52 crore while domestic funds bought shares worth a net Rs 63.25 crore today, 14 July 2008.

The market breadth was weak. On BSE, 1587 shares declined, 983 advanced and 73 remained unchanged.

The BSE Mid-Cap index slipped 0.64% to 5,330.80 and the BSE Small-cap index fell 1.10% to 6,640.06

The total turnover on BSE amounted to Rs 4191 crore as compared to Rs 5,386.39 crore on Friday, 11 July 2008. Turnover in NSE’s futures and options segment amounted to Rs 40096.24 crore as compared to Rs 50149.82 crore on Friday, 11 July 2008

Sectoral indices on BSE displayed mixed trend. The BSE Power (down 0.20% to 2,339.28), BSE Realty index (down 0.78% at 4,762.53), BSE Metal index (up 1.46% to 12,897.19), BSE Auto (up 1.05% at 3,566.49), BSE Oil & Gas index (up 1.11% to 8,985.07), BSE PSU index (up 2.02% to 6,087.99), BSE Consumer Durables index (up 0.01% to 3,589.41), BSE Capital Goods index (down 0.32% at 10,740.01), outperformed the Sensex.

The BSE Bankex (down 1.36% at 5,970.52), BSE TecK index (down 3.83% to 2,886.11), BSE FMCG index (down 1.46% to 1,958.29), BSE Health Care index (down 1.21% at 4,079.92), and BSE IT index (down 5.94% to 3,675.59), underperformed the Sensex.

Political uncertainty will continue to weigh on the domestic bourses in the near term. The government is holding a two-day special session of parliament on 21 July 2008-22 July 2008 to seek vote of confidence after it was reduced to minority following withdrawal of support by Left parties on 8 July 2008. The government hopes to retain power due to backing from Samajwadi Party, a regional party in Uttar Pradesh

Oil, India's biggest import, was trading above $143 a barrel, but below a record high of $147.27 hit on Friday, 11 July 2008.

Among the 30-member Sensex pack, 15 advanced while the rest slipped.

India’s largest pharma company in terms of sales Ranbaxy Laboratories tumbled 10.83% to Rs 473.90 on 28.61 lakh shares. It was the top loser from Sensex pack. The stock was hammered on reports the US government has levelled serious allegations against the company. The US department of justice (DoJ) has said that there was evidence to suggest that Ranbaxy used active pharmaceutical ingredients (API) from unapproved sources, blended unapproved API with approved API, and used less-than-approved API at its Paonta Sahib (Himachal Pradesh) plant in its drugs, resulting in the sale of subpotent, super- potent or adulterated medicines in the US market.

In a statement, Ranbaxy strongly denied the allegations raised by the US Department of Justice (DOJ). The company also stated that its business in the US continues as normal. Ranbaxy also said the company's deal with Japanese drug maker Daiichi Sankyo is binding and final and remains on track.

IT stocks extended Friday’s losses after IT bellwether Infosys Technologies said on Friday, 11 July 2008, at the time of announcing Q1 June 2008 results that the business environment was tough. The stock plunged 6.95% to Rs 1559.90, after declining 7.18% on Friday, 11 July 2008. Infosys has a higher weightage of 4.7% in Sensex as compared to 3.66% in Nifty.

At the time of announcing the Q1 results, Infosys revised earnings and revenue guidance upward for the year ending March 2009 (FY 2009). Infosys has forecast 24.4% to 26.6% growth in earnings per share as per Indian GAAP at between Rs 98.79 to Rs 100.51 in FY 2009 over the year ended March 2008 (FY 2008). It has forecast a between 27.5% to 29.5% growth in revenue at between Rs 21278 crore and Rs. 21622 crore in FY 2009 over FY 2008.

TCS (down 3.63% at Rs 770.10), Satyam Computer Services (down 7.60% at Rs 410.65), and Wipro (down 1.48% at Rs 406.20), slipped. The ADRs of Infosys (down 13.30%), Satyam Computer Services (down 9.17%) and Wipro (down 2.82%) slumped on the NYSE on Friday, 11 July 2008.

ITC (down 3.53% to Rs 168.30), HDFC Bank (down 3.23% to Rs 1033), and Hindalco Industries (down 2.90% to Rs 150.70) edged lower from the Sensex pack.

India’s top tractor maker in terms of sales Mahindra & Mahindra (M&M) surged 4.50% to Rs 554.90 on 25,411 shares. It was the top gainer from Sensex pack.

India’s largest state-run oil exploration company in terms of market capitalisation Oil and Natural Gas Corporation (ONGC) galloped 3.60% to Rs 879.85. The company is reportedly in talks with British firm Imperial Energy Corp to form an alliance which could include it buying an equity interest in the UK-based firm. If ONGC manages to strike a deal with Imperial Energy, it will strengthen the ONGC's overseas presence.

India’s largest private sector firm by market capitalization and oil refiner Reliance Industries rebounded from day’s low of Rs 1992.35. It was now up 2.11% at Rs 2059 on 12.03 lakh shares.

India's largest state-run bank by net profit State Bank of India vaulted 3.51% to Rs 1265.10 after touching a low of Rs 1205 in early trade. The bank is likely to report double-digit net profit growth in the Q1 June 2008, Chairman O.P. Bhatt told media reporters on Friday, 11 July 2008.

India's largest private sector bank by net profit ICICI Bank recovered from day’s low of 573.25. It settled with loss of 1.88% to Rs 580.40. Its American depository receipt (ADR) lost 7.4% on the New York Stock Exchange (NYSE) on Friday, 11 July 2008. ICICI bank has a higher weightage of 3.4% in Sensex as compared to 2.65% in Nifty.

World’s sixth largest steel producer in terms of annual capacity Tata Steel surged 3.11% to Rs 686.90 on reports the company is looking at acquiring an iron ore mine in Western Australia to supply iron ore to Corus' plants.

NTPC (up 3.71% to Rs 167.90) and Ambuja Cement (up 2.61% to Rs 82.60) edged higher from Sensex pack.

Larsen & Toubro (L&T), the country’s largest state-run engineering firm in terms of outstanding order book position advanced 2.19% to Rs 2408.80, after sliding to a low of Rs 2320.20. L&T has higher weightage of 3.69% in Sensex as compared to 2.87% in Nifty.

India’s largest state-run engineering firm in terms of outstanding order book position Bharat Heavy Electricals fell 3.35% to Rs 1470.40 despite reports of the company is looking to acquire a locomotive manufacturing facility in Europe.

Debutante KSK Energy Ventures settled at Rs 190.50 on BSE, a discount of 20.63% over the initial public offer price of Rs 240. The counter saw high volumes of 99.26 lakh shares on BSE. The stock debuted at Rs 220, a discount of 8.33% over the initial public offer (IPO) price. It hit a high of Rs 234.80 and a low of Rs 176 in the day.

Reliance Capital topped the turnover charts on BSE clocking turnover of Rs 306.25 crore followed by Reliance Industries (Rs 249 crore), NDTV (Rs 193 crore), KSK Energy (Rs 191.50 crore) and Infosys (Rs 145.20 crore), in that order.

IFCI led the volumes chart with volumes of 1.81 crore shares followed by Reliance Natural Resources (1.47 crore shares), Ispat Industries (1.23 crore shares), KSK Energy (99.25 lakh shares) and Chambal Fertilisers (85 lakh shares), in that order.

Among side counters, Selan Exploration (up 20% to Rs 216.80), Suzler India (up 13.81% to Rs 777.90), Saurashtra Cement (up 20% to Rs 32.85), surged

EIH Associates (down 12.22% to Rs 111), Sparsh BPO (down 11.67% to Rs 70), and EPC (down 10.50% to Rs 26), slumped.

Tata Sponge Iron rose 2.49% to Rs 224 after the company reported 77.4% rise in net profit to Rs 29.33 crore on 8.8% increase in sales to Rs 101.77 crore in Q1 June 2008 over Q1 June 2007.

Axis Bank fell 4.68% to Rs 638.25 despite posting 88.67% rise in net profit to Rs 330.14 crore on 53.84% rise in total income to Rs 2891.24 crore in Q1 June 2008 over Q1 June 2007. The bank announced the result during market hours today, 14 July 2008.

Hindustan Zinc surged 8.63% to Rs 584.95 tracking surge in zinc futures in Shanghai. Shanghai zinc futures gained 1% on Monday, 14 July 2008, after rising by their 4% daily limit in the last session, following a weekend agreement by small-and medium-sized Chinese smelters to cut production by 10%.

NDTV rose 2.06% to Rs 405.35 after three block deals totaling 40.29 lakh shares at an average price of Rs 430.86 were executed on the counter on BSE in opening trade.

SpiceJet lost 13.27% to Rs 28.10 after its chief executive officer Siddhanta Sharma resigned over the weekend citing personal reasons.

HCL Technologies slumped 4.71% to Rs 227.80 after the company said on Friday, 11 July 2008 it may incur forex losses between $65-75 million in Q4 June 2008, owing to a sharp fall in rupee against the dollar.

IFCI lost 4.29% to Rs 37.90 after it reported 38.8% fall in net profit to Rs 151.07 crore on 18.1% increase in operating income to Rs 414.49 crore in Q1 June 2008 over Q1 June 2007. The company announced the result on Saturday, 12 July 2008.

Most Asian markets, which opened before Indian markets, were trading lower today, 14 July 2008. Key benchmark indices in Hong Kong, South Korea, Japan Taiwan and Singapore were down by between 0.23% and 1.21%. However China’s Shanghai Composite gained 0.76%

US markets ended volatile session on Friday, 11 July 2008, with the Dow Jones falling below the 11,000 level for the first time since August 2006. Growing concern about the health of Fannie Mae and Freddie Mac send bank shares to an 11-year low. The Dow Jones Industrial Average slumped 128.48 points to 11100.54 and the Nasdaq Composite shed 18.77 points at 2239.08. The Standard & Poor's 500 index dropped 13.90 points to 1,239.49.

India's industrial production rose 3.8% in May 2008, much lower than revised 6.2% growth in April 2008, the government data released on 11 July 2008 showed. Industrial production growth for April 2008 revised downwards to 6.2% from earlier 7%.

Inflation based on the wholesale price index surged to a fresh 13-year high 11.89% in 12 months to 28 June 2008, above the previous week's annual rise of 11.63%, government data released on 11 July 2008 showed. This is much higher than the Reserve Bank's tolerance limit of 5.5% set for the current fiscal.