Market settles near day’s apex

Frenzied buying in index pivotals tracking the US crude oil prices which slumped to 3-month low and firm European markets triggered a solid rally on the bourses despite a shaky start. The BSE Sensex almost kissed 15,000 mark in late trade. The S&P CNX Nifty surged past the 4,500 mark in late trade.

Interest rate sensitive sectors like realty, auto and banking shares were in forefront. Volatility was high throughout the day. The market breadth was strong. Total turnover on the bourses surged.

US crude oil dropped to a low of $118 per barrel in Asian trades today, a lowest level since 5 May 2008. US crude futures tumbled yesterday, 4 August 2008, as OPEC output rose for the third month in a row in July, outweighing concerns about Tropical Storm Edouard. On the New York Mercantile Exchange, September crude settled down $3.69 at $121.41 a barrel.

The BSE 30-share Sensex advanced 383.20 points or 2.63% to 14,961.07. It had opened 15.19 points lower at 14,562.68. At the day’s low of 14,529.21 hit in early afternoon trade, the Sensex lost 48.66 points. At the day’s high of 14,986.63 hit in late trade, the Sensex gained 408.76 points.

The S&P CNX Nifty surged 107.5 points or 2.45% at 4,502.85. It moved in a range of 4515.15 and 4376 during the day. Nifty August 2008 futures were at 4533.10, a premium of 30.25 points as compared to spot closing.

Total turnover on the bourses surged. NSE's futures & options (F&O) segment turnover was Rs 52,692.78 crore, which was higher than Rs 43,364.62 crore on Monday, 5 August 2008. Turnover on BSE amounted to Rs 6941 crore on BSE as compared to Rs 6,008.96 crore on Monday, 5 August 2008.

The market breadth was strong on BSE with 1764 shares advancing as compared to 940 that declined. 64 remained unchanged.

Among the 30-member Sensex pack, 28 advanced while only 2 of them slipped.

Auto stocks surged after crude oil prices hit $118 per barrel in Asian trades today, a lowest level since 5 May 2008.. India’s top small car maker in terms of sales Maruti Suzuki India galloped 8.36% to Rs 620 on 2.98 lakh shares. It was the top gainer from the Sensex pack.

Other auto shares Tata Motors (up 3.71% to Rs 410.95), Hero Honda Motors (up 4.12% to Rs 828), Ashok Leyland (up 10.69% to Rs 32.10), Bajaj Auto (up 10.68% to Rs 379.95), and Mahindra & Mahindra (up 5.26% to Rs 547), advanced.

Banking shares vaulted on intense buying in anticipation of reforms in the financial sector post the UPA Government winning the trust vote late last month. HDFC Bank (up 6.44% to Rs 1180), ICICI Bank (up 8.06% to Rs 692.10), and State Bank of India Bank (up 4.69% to Rs 1579.90), surged from the frontline banking pack.

Realty shares surged on fresh buying. DLF (up 7.94% to Rs 554.60), Parsvnath Developers (up 4.70% to Rs 127.05), HDIL (up 6.18% to Rs 507.50), and Indiabulls Real Estate (up 2.80% to Rs 312.05), also logged gains from the realty space.

Cement shares also joined the rally despite agreeing to maintain status quo on low monsoon demand, capacity addition. Cement companies, which agreed in May to hold prices for three months to help the government contain inflation, could find it difficult to raise rates when the moratorium ends on 14 August 2008.

Ambuja Cements (up 5.24% to Rs 87.30), Grasim (up 7.21% to Rs 2031), and ACC (up 5.50% to Rs 618), were the other gainers from cement pack.

National Thermal Power Corporation (NTPC), the country’s biggest power utility soared 4.03% to Rs 182.20 on reports that the firm has readied a $3-billion war chest for global buyouts.

India’s largest power equipment maker by sales, Bharat Heavy Electricals gained 3.55% to Rs 1755 after the company bagged an order worth Rs 2500 crore to supply 800-megawatt generators for a power plant in south India.

India’s number two cellular services provider in terms of market capitalisation Reliance Communications was up 0.67% to Rs 442.30. According to reports, the company is all set to float a $500-million tender for GSM 3G networks. At present, RCOM is predominantly a CDMA-based operator which is now looking at 3G services only in the GSM space.

IT pivotals made a comeback after yesterday’s fall. TCS (up 2.17% to Rs 834), Infosys (up 1.28% to Rs 1677), Satyam Computer (up 1.11% to Rs 400.05), and Wipro (up 3.60% to Rs 446.30), edged higher.

Jaiprakash Associates (up 7.02% to Rs 186.75), HDFC (up 3.89% to Rs 2465), and Reliance Infrastructure (up 4.43% to Rs 1043) edged higher from Sensex pack.

India’s largest private sector firm by market capitalization and oil refiner Reliance Industries recovered from day’s low of Rs 2206.70. It was up 1.49% at Rs 2276 on 16.86 lakh shares.

Tata Steel, India’s largest private sector steelmaker by sales slumped 2.59% to Rs 673.80 on 27.03 lakh shares. The stock moved in a range of Rs 693 and Rs 655.50 during the day. It was the top loser from the Sensex pack. As per reports, the company has consolidated all its overseas assets including Corus under a new holding company, Tata Steel Global, to raise funds for its overseas expansion including future acquisitions. Tata Steel Global, based in Singapore with over $13 billion enterprise value, will raise funds for international acquisitions of smaller steel makers and mines.

India’s largest bulk drug market in terms of sales Ranbaxy slipped 2.07% to Rs 513.15. The company today, 5 August 2008, said that the open offer by the Japanese drug maker Daiichi Sankyo for acquiring an additional 20% stake in it will commence on 16 August 2008 from the earlier schedule of 8 August 2008. The offer would now expire on 4 September 2008, instead of the previously scheduled 27 August 2008.

Reliance Industries topped the turnover chart on BSE with a turnover of Rs 380 crore followed by Reliance Capital (Rs 360 crore), Reliance Natural Resources (Rs 288.50 crore), ICICI Bank (Rs 220 crore) and Essar Oil (Rs 203.65 crore), in that order.

Reliance Natural Resources led the volumes chart on BSE with volumes of 2.75 crore shares followed by Ispat Industries (2.07 crore shares), IFCI (1.27 crore shares), Reliance Petroleum (1.02 crore shares) and Kashyap Technologies (92.40 lakh shares) in that order.

State-run oil marketing companies advanced after crude oil prices hit $118 per barrel in Asian trades today, a lowest level since 5 May 2008. Hindustan Petroleum Corporation (up 3.65% to Rs 235.10), Bharat Petroleum Corporation (up 2.87% to Rs 337), and Indian Oil Corporation (up 1.77% to Rs 433.60), gained.

Stocks of the sugar companies advanced on reports the government fixed lower free sale sugar quota in August 2008 at 900,000 tonnes. Reports also suggested that sugar prices in Maharashtra may spike to over-two-year highs in the first half of next year as output in the year ending September 2009 may fall by over 37%.

Sakthi Sugars (up 2.44% to Rs 109.20), Balrampur Chini (up 1.89% at Rs 91.75), and Bajaj Hindustan (up 1.87% at Rs 172), spurted on the back of such reports.

Among the side counters, XL Telecom (up 20% to Rs 211.65), Sujana Industries (up 19.95% to Rs 14.49), and Rama Paper (up 19.94% to Rs 20.75), surged.

Moschip Semiconductor (down 8.79% to Rs 17.65), Jai Balaji (down 9.35% to Rs 308), and Trigyn Tech (down 8.36% to Rs 20.50), slumped.

Thermax jumped 4.18% to Rs 470, extending previous day's gain after the company bagged an order worth Rs 415 crore for setting up a captive power plant for a leading steel making company. The company made this announcement during trading hours on Monday, 4 August 2008 when the stock settled 3.33% higher at Rs 451.15.

i-flex Solutions rose 2.37% to Rs 1450 after the company said China-based Taizhou City Commercial Bank has selected its banking suit Flexcube for internet banking platform. The company made this announcement before trading hours on Tuesday, 5 August 2008.

Sesa Goa plunged 6% to Rs 3335 on reports the Centre is considering a proposal to bring iron ore under price control in an attempt to check steel prices.

European markets, which opened after Indian markets, extended early gains. Key benchmark indices in UK, France and Germany were up by between 1.24% and 2.01%. In a crucial event, the US Federal Reserve meets after Indian market hours today to decide on interest rates.

Asian markets, which opened before Indian market, settled lower today, 5 August 2008. Key benchmark indices in China, Hong Kong, Japan, Taiwan, Singapore, and South Korea were down by between 0.49% and 2.51%.

US stocks fell yesterday, 4 August 2008, as shares of energy and commodity-related companies tumbled on falling oil and metals prices and investors worried the housing slump could fuel further losses at financial companies. The Dow Jones Industrial Average fell 42.17 points, or 0.37%, to 11,284.15, the Standard & Poor's 500 Index slid 11.30 points, or 0.9% to 1,249.01, while the Nasdaq Composite Index dropped 25.40 points, or 1.10%, to 2,285.56.

Back home, key indices ended lower in a turbulent session yesterday, 4 August 2008. The BSE Sensex slipped 78.82 points or 0.54% to 14,577.87 and the NSE Nifty shed 18 points or 0.41% to 4395.35.

Meanwhile, international credit rating agency Moody’s Corporation has cautioned that they might be looking at revising India’s rating downward. This is the second rating agency other than S&P that has given out a red flag on India’s economic fundamentals.