Market ends slightly higher on recovery in bank stocks; RIL slips

Stocks ended choppy trading sessions slightly higher boosted by fall in crude oil prices and reports of a near normal monsoon. The BSE 30-share Sensex rose 31.87 points. IT and banking stocks played a lead role in the recovery. The market had opened weak on negative global cues. Index heavyweight Reliance Industries (RIL) slipped. The market breadth was negative. European and Asian markets were trading lower.

India's annual monsoon rains between 1 June 2008 to 24 August 2008 were just below the long-term average, a government statement said today, 26 August 2008. The rains are vital for the rural economy as India has limited irrigation. Up to late August 2008, the rains were 1% below the average.

US crude fell $1.71 to $113.40 a barrel today, 26 August 2008, as the US dollar strengthened, countering concern that Hurricane Gustav could threaten oil installations in the Gulf of Mexico.

As per provisional data on NSE, Foreign institutional investors (FIIs) were net equity sellers worth Rs 572.04 crore while mutual funds purchased shares worth Rs 276.92 crore today, 26 August 2008.

The BSE 30-share Sensex rose 31.87 points or 0.22% to 14,482.22. At the day’s high of 14,495.27 hit in late trade, the Sensex gained 44.92 points. Sensex hit a low of 14,286.38 in early trade. At the day’s low, the Sensex lost 163.97 points.

The S&P CNX Nifty rose 2.15 points or 0.05% at 4337.50. Nifty August 2008 futures were at 4352.75, at a premium of 15.25 points as compared to spot closing.

The BSE Sensex is down 5804.77 points or 28.61% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 6724.55 points or 31.70% away from its all-time high of 21,206.77 struck on 10 January 2008.

Global cues were negative. Asian markets, which opened before Indian markets were weak today, 26 August 2008. Key benchmark indices in China, Hong Kong, Japan, Taiwan, Singapore, and South Korea were down by between 0.23% and 2.62%.

European markets, which opened after Indian market, were subdued. Key benchmark indices in UK, Germany and France were down by between 0.11% and 1.82%.

The BSE Mid-Cap index rose marginally by 0.06% to 5,744.77 and the BSE Small-Cap index slipped 0.14% to 6,912.62.

Volatility may remain high in the near term ahead of the expiry of derivative contracts for the August 2008 on Thursday, 28 August 2008. As per reports, marketwide rollover of positions from August 2008 series to September 2008 series stood at 31% while that of Nifty was at 28%, as of Monday, 25 August 2008.

The market breadth was negative on BSE with 1376 shares declining as compared to 1212 that advanced. 103 remained unchanged.

The total turnover on BSE amounted to Rs 3769 crore as compared with Rs 3,255.57 crore yesterday, 25 August 2008. NSE's futures & options (F&O) segment turnover was Rs 49,779.36 crore, higher than Rs 45,979.13 crore on Monday, 25 August 2008.

Among the 30-member Sensex pack, 16 declined while the rest advanced.

Bank stocks staged a comeback from early lows. India’s second largest private sector bank by net profit HDFC Bank vaulted 3.96% to Rs 1256 on 3.20 lakh shares. It was the top gainer from Sensex pack. The stock recovered sharply from day’s low of Rs 1175.

ICICI Bank (up 1.46% to Rs 665.45, off day’s low of Rs 639), and State Bank of India (up 0.63% to Rs 1366, off day’s low of Rs 1333.45) also logged gains.

Most IT stocks rose as the rupee weakened to 17-month low beyond 44 per dollar. Satyam Computer Services (up 3.36% at Rs 406.50), Wipro (up 2.25% to Rs 429.10), and TCS (up 1.97% to Rs 834), rose.

A weak rupee boosts margins of IT companies as they derive a lion's share of revenue from exports to US.

However Infosys Technologies, the country’s second largest software services exporter fell 0.36% to Rs 1697. The stock moved in a range of Rs 1688 and Rs 1739.80 during the day. The company said after trading hours on Monday, 25 August 2008, it has agreed to acquire UK based SAP consulting company Axon Group plc, for 407.1 million pounds or Rs 3310 crore. Axon reported profit after taxation of 20.2 million pounds (Rs 160 crore) on revenue of 204.5 million pounds or Rs 1660 crore in the year ended 31 December 2007.

India’s largest pharma company by sales, Ranbaxy Laboratories rose 1.15% to Rs 518. As per reports on 25 August 2008, the purchase a controlling stake by Daiichi Sankyo, Japan's third-largest drugmaker, in the company, needs the approval of the Cabinet Committee on Economic Affairs because it exceeds Rs 600 crore.

Real estate heavyweights DLF (up 0.87% to Rs 499.50), and Unitech (up 0.62% to Rs 161.30), rose.

India’s largest oil exploration company by market capitalisation Oil & Natural Gas Corporation advanced 1.12% to Rs 1023.05 on reports its unit ONGC Videsh was finalising a 1.4 billion pounds bid to buy Russia-focussed oil explorer Imperial Energy. Imperial said in a statement today, 26 August 2008, that a 1,250 pence per share cash offer was being discussed and that a further announcement on the matter was expected later in the day.

India’s top power equipment maker by sales, Bharat Heavy Electricals gained 2.04% to Rs 1723 after the company said it had won a contract worth Rs 140 crore from the United Arab Emirates for two gas turbine generating units of 42 megawatt each.

Mahindra & Mahindra (up 2.05% to Rs 575), and Hindustan Unilever (up 1.89% to Rs 248.50), edged higher from the Sensex pack.

India’s largest private sector firm by market capitalization and oil refiner Reliance Industries (RIL) slumped 2.06% at Rs 2185 on 13.03 lakh shares. It was the top loser from Sensex pack. The stock recovered from session's low of Rs 2145.90. As per reports, RIL is planning to transfer 80% of its participatory interest (PI) in the D6 block in the Krishna Godavari (KG) basin to four unlisted subsidiaries. The block is reportedly valued at nearly $50 billion.

Shares of frontline telecom service providers were subdued. India's second largest listed cellular services provider by sales Reliance Communications (RCom) slipped 0.65% to Rs 406.75. The issue of RCom's interconnection with GSM operators was resolved last week.

India’s largest cellular services provider by sales Bharti Airtel declined 0.21% to Rs 812.05.

Tata Motors, the country’s top truck manufacturer by sales, fell 0.18% to Rs 433.50 even as the West Bengal Chief Minister Buddhadeb Bhattacharjee said his government may compensate farmers at Tata Motors' factory in Singur to resolve a dispute over the Nano car plant.

Jaiprakash Associates (down 1.56% to Rs 157.30), HDFC (down 1.32% to Rs 2332.30), and Tata Steel (down 1.27% to Rs 578.15) edged lower from the Sensex pack.

Reliance Industries was the top traded counter on BSE with turnover Rs 283.30 crore followed by Reliance Capital (Rs 248.20 crore), Reliance Natural Resources (Rs 173 crore), Vishal Information Systems (Rs 158.45 crore) and Infosys Technologies (Rs 116.60 crore), in that order.

Reliance Natural Resources topped volumes charts on BSE clocking volumes of 1.86 crore shares followed by Pennar Industries (1.81 crore shares), Firstsource Solutions (87.85 lakh shares), Marksans Pharma (72.50 lakh shares) and IFCI (63.26 lakh shares), in that order.

Pennar Industries slumped 4.95% to Rs 31.70 on massive volumes. The company today, 26 August 2008, said Hyderabad's JR Realtor Services had acquired 1.30 crore shares or 10.28% of its share capital through a block deal at a weighted average price of Rs 32.47 per share.

Among the side counters, Firstsource Solutions (up 24.46% to Rs 49.10), Lumax Industries (up 15.77% to Rs 189), and Usher Agro (up 20% to Rs 127.70), surged

Sasken Communication Technologies slipped 1.27% to Rs 151.15 after the company said it has filed an appeal before the Securities Appellate Tribunal to proceed with its proposed buyback of shares. The company made this announcement before trading hours today, 26 August 2008.

TTK Prestige surged 20% to Rs 158.55 after the firm said its board will meet on 1 September 2008 to consider delisting of equity shares from BSE and NSE. The company made the announcement after market hours on Monday, 25 August 2008.

Bosch soared 13.65% to Rs 4149 after the company said its board will meet on 2 September 2008 to consider a share buyback. The company made the announcement after market hours on Monday, 25 August 2008.

HCL Technologies gained 2.68% to Rs 229.60 after the company said it has acquired Control Point Solutions of United States, a leading provider of voice, data and wireless telecommunications expense management services. The company made this announcement during trading hours on Monday, 25 August 2008.

US markets plunged yesterday, 25 August 2008, led by financials as AIG tumbled to a 13- year low, while Washington Mutual led other financial companies lower. The Dow Jones industrial average slumped 241.81 points, or 2.08%, to 11,386.25. The S&P 500 index lost 25.36 points, or 1.96%, to 1,266.84, and the Nasdaq Composite index declined 49.12 points, or 2.03%, to 2,365.59.