Market continues uptrend; PSU banks rally

The market extended a recovery witnessed recently, with the Sensex surging 865.15 points in the last three trading sessions. The market, which had opened weak on subdued global cues completely changed the course, ending near the day's high today. The rally gathered steam in late trade after United Nations nuclear watchdog chief Mohamed ElBaradei today said a basic inspection plan for India met all safeguards standards. Members of International Atomic Energy Agency's (IAEA) board of governors will be voting on the India-specific nuclear safeguard agreement, a key step in operationalisation of the Indo-US nuclear deal.

Index heavyweight Reliance Industries surged. Oil & gas, capital goods, power stocks gained. Jaipraksh Associates gained more than 8.5%. State Bank of India and HDFC jumped more than 5.5% each. Bharat Heavy Electricals and Reliance Infrastructure surged more than 4.5% each.

Reliance Communications (RCom) dipped more than 12% on disappointing Q1 results. The market breadth turned positive from earlier weak breadth.

Finance Minister P Chidambaram today said interest rates may moderate in six to 12 months. A number of public sector and private sector banks have raised lending rates and deposit rates after the Reserve Bank of India, early this week, raised repo rate by 50 basis points to 9% and cash reserve ratio by 25 basis points to 9%, at its quarterly policy review.

Telecom minister A Raja today said the government will hold a global auction for high-speed third-generation (3G) mobile services and have five operators initially. India has 60 MHz of 3G spectrum available, and will allow both GSM and CDMA 3G services, he said.

The 30-share BSE Sensex jumped 300.94 points or 2.1% at 14,656.69. Sensex rose 326.58 points at the day's high of 14,682.33 hit in late trade. At the day’s low of 14,032.87, the Sensex lost 322.88 points in early trade. The initial sharp fall was due to weak global cues.

The barometer index BSE Sensex is down 5,630.3 points or 27.75% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 6,550.08 points or 30.88% away from its all-time high of 21,206.77 struck on 10 January 2008.

The broader based S&P CNX Nifty was up 80.6 points or 1.86% at 4,413.55. Nifty August 2008 futures were at 4435, at a premium of 21.45 points as compared to spot closing of 4413.55.

The BSE clocked the turnover of Rs 6725 crore today as compared to Rs 5,091.04 crore on Thursday, 31 July 2008. NSE's futures & options (F&O) segment turnover was Rs 48,778.01 crore, which was lower than Rs 64,640.25 crore on Thursday, 31 July 2008.

The market breadth turned positive compared to weak breadth earlier in the day. 1,551 shares advanced on BSE as compared to 1108 that declined. 73 remained unchanged.

Among the 30-member Sensex pack, 22 gained while the rest declined.

The BSE Mid-Cap index rose 1.35% to 5,642.74 and BSE Small-Cap index rose 0.97% to 6,980.10. Both these indices underperformed Sensex.

BSE Capital Goods index (up 3.84% to 12,132), Power index (up 3.4% to 2,661.75), BSE PSU index (up 3.27% to 6,925.52), BSE Oil & Gas (up 3.26% to 10,047.86), BSE Bankex (up 3.26% to 6,728.56), BSE IT index (up 2.99% to 3,800.06), BSE Metal index (up 2.62% to 13,250.31), BSE BSE Realty index (up 2.37% to 5,199.20) outperformed Sensex.

BSE FMCG index (down 0.8% to 2,121.96), BSE Auto index (down 0.63% to 3,656.49), BSE Teck index (up 0.63% to 3,019.32), BSE HealthCare (up 0.69% to 4,190.84), BSE Consumer Durables index (up 0.71% to 3,712.19), underperformed Sensex.

India’s largest private sector firm by market capitalization and oil refiner Reliance Industries (RIL) rose 4.24% to Rs 2,299.75. It recovered from session’s low of Rs 2,160.

PSU banks rose. Indian Bank (up 8.39% to Rs 104.05), Bank of Baroda (up 7.98% to Rs 275.90), State Bank of India (up 6.05% to Rs 1,500.30), Punjab National Bank (up 7.16% to Rs 483.55), IDBI Bank (up 5.27% to Rs 78.90), Bank of India (up 6.17% to Rs 288.25), Canara Bank (up 7.07% to Rs 196.75) edged higher.

Union finance minister P Chidambaram on Thursday said the government will carry out all reform measures that do not require parliamentary approval. At the same time, he asserted that the three overarching bills for financial sector reforms—the Banking Regulation (Amendment) Bill, 2005; the Insurance Bill seeking to raise the foreign direct investment (FDI) cap from 26% to 49% and the Pension Fund Regulatory and Development Authority Bill, 2005—would be passed by Parliament within the government’s term.

Capital goods stocks rose. Larsen & Toubro (up 3.45% to Rs 2,692.40) , Bharat Heavy Electricals (up 4.61% to Rs 1,756.50) and Suzlon Energy (up 7.14% to Rs 238.70) edged higher.

Power stocks rose ahead of the IAEA meet. Reliance Infrastructure (up 4.71% to Rs 1,010.60), PowerGrid Corporation of India (up 2.85% to Rs 97.45), NTPC (up 3.67% to Rs 176.70), Reliance Power (up 2.78% to Rs 169.90) edged higher.

OiI & gas stocks rose. BPCL (up 2.28% to Rs 334.75), HPCL (up 2.05% to Rs 224.45), Indian Oil Corporation (up 3.38% to Rs 416.90), Reliance Petroleum (up 2.58% to Rs 168.95), ONGC (up 0.08% to Rs 996.85) edged higher. On Thursday, 31 July 2008, the front-month US crude oil contract settled at $124.08, down $2.69 for the day and off sharply from a record above $147 a barrel on 11 July 2008.

The world’s sixth largest steel maker Tata Steel rose 3.92% to Rs 680.65. It recovered from its lows of Rs 635. On the back of higher prices and strong volume growth, Tata Steel on Thursday reported 22% growth in net profit to Rs 1488 crore on 46% growth in net sales to Rs 6165 crore in Q1 June 2008 over Q1 June 2007. The company said the profitability was impacted by an exchange loss of Rs 303.40 crore on its overseas bonds due to fall in rupee against the dollar.

India's largest-listed realty firm, DLF declined 2.13% to Rs 520.15. It recovered from session’s lows of Rs 480. On Thursday it reported 23% growth in consolidated net profit to Rs 1864 crore on 23.2% growth in total revenue to Rs 3846 crore in Q1 June 2008 over Q1 June 2007. Unitech (down 0.64% to Rs 162.50) and Indiabulls Real Estate (down 1.24% to Rs 282.50) edged lower.

India’s largest car maker by sales Maruti Suzuki India fell 2.5% to Rs 560.50 on reporting 1.09% rise in vehicle sales to 58,543 units in July 2008 over July 2007.

India’s largest private secor bank by net profit ICICI Bank rose 1.14% to Rs 642.10. It recovered from session's low of Rs 610. ICICI Bank on Thursday said it has hiked lending and deposit rates.

India’s largest dedicated mortgage firm by operating income HDFC rose 5.51% to Rs 2,402.50. It recovered from session’s lows of Rs 2,195.On Thursday, 31 July 2008, HDFC said it has hiked its floating interest rates on home loans for both existing and new customers with effect from Friday, 1 August 2008.

India’s second largest telecom services provider by sales Reliance Communications fell 12.65% to Rs 436.80. On Thursday it reported 23.9% growth in consolidated net profit to Rs 1512 crore on 23.7% growth in revenue to Rs 5322 crore in Q1 June 2008 over Q1 June 2007. This is the slowest profit growth for the company in nine quarters.

Tata Power Company (down 3.76% to Rs 1,116.50), Hindustan Unilever (down 1.9% to Rs 235.15), ACC (down 1.33% to Rs 576.50), ITC (down 0.05% to Rs 187.70), edged lower from the Sensex pack.

Jaiprakash Associates (up 8.67% to Rs 170.45), Wipro (up 3.99% to Rs 432.60), Infosys (up 3.59% to Rs 1,640.10), Satyam Computer Services (up 2.85% to Rs 391.15) edged higher form Sensex pack.

Reliance Natural Resources clocked the highest volume of 3.78 crore shares on BSE. IFCI (2.28 crore shares), Ispat Industries (2.04 crore shares), Cybermat Infotek (2.02 crore shares) and Reliance Communications (1.44 crore shares) were the other volume toppers in that order.

Reliance Communications clocked the highest turnover of Rs 631.04 crore on BSE. Reliance Natural Resources (Rs 375.37 crore), Reliance Capital (Rs 347.75 crore), Reliance Industries (Rs 297.09 crore) and Larsen & Toubro (Rs 186.91 crore) were the other turnover toppers in that order.

The wholesale price index rose 11.98% in the 12 months to 19 July 2008, above the previous week's reading of 11.89%, data released after market hours yesterday, 31 July 2008 showed.

European markets opened weak France’s CAC 40, Germany’s DAX and UK’s FTSE 100 fell between 0.34% to 0.94%.

Asian markets were trading mixed after weak start today, 1 August 2008. Japan's Nikkei, Taiwan's Taiwan Weighted, Singapore's Straits Times, and South Korea's Seoul Composite fell between 0.31% to 2.11%. China's Shanghai Composite rose 1.33% while Hong Kong's Hang Seng rose 0.58%.

US markets tumbled yesterday, 31 July 2008 after disappointing economic data dampened sentiment. Federal Reserve Chairman Alan Greenspan's statement that a slowing global economy may push the United States into recession and that US housing market crisis is nowhere near the bottom added to the bearish mood. The Dow plunged 205.67 points, or 1.78%, to 11,378.02. The Standard & Poor's 500 index declined 16.88 points, or 1.31%, to 1,267.38, while the Nasdaq lost 4.17 points, or 0.18%, to 2,325.55.