TCS, RIL pull market lower, breadth strong

Key benchmark indices settled lower after swinging wildly either ways throughout the day. Global cues were mixed with negative bias. However buying momentum in small-cap and mid-cap stocks kept the market breadth strong. European market, which opened after Indian markets were mixed. While Asian markets, which opened before Indian markets were trading lower.

Selling pressure was seen in capital goods, banking and power stocks while metal, realty, fertiliser and select technology stocks witnessed buying demand.

The BSE 30-share Sensex settled 78.82 points or 0.54% lower at 14,577.87. The benchmark index opened 62.08 points lower at 14,594.64 tracking negative global cues. At the day’s low of 14,503.51 hit in mid-morning trade, the Sensex lost 153.18 points. However at the day’s high of 14,725.94 hit in early afternoon trade, the Sensex gained 69.25 points.

The barometer index BSE Sensex is down 5709.12 points in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 6628.90 points away from its all-time high of 21,206.77 struck on 10 January 2008.

The S&P CNX Nifty lost 18.2 points or 0.41% to settle at 4395.35. It has touched an intraday high of 4436.15 and low of 4,362.90 during the day. Nifty August 2008 futures were at 4,400, a sharp premium of 37.10 points.

The market breadth was strong on BSE with 1827 shares advancing as compared to 837 that declined. 56 remained unchanged.

The BSE Mid-Cap index was up 1.77% to 5,742.72 and the BSE Small-Cap index gained 1.77% to 7,103.34. Both these indices outperformed the Sensex.

The total turnover on BSE amounted to Rs 5987 crore as compared to Rs 6,763.87 crore on Friday, 1 August 2008. The total turnover on BSE amounted to Rs 5987 crore as compared to Rs 6,763.87 crore on Friday, 1 August 2008. Turnover in NSE’s futures & options segment amounted to Rs 43364.62 crore as compared to Rs 48778.01 crore on Friday, 1 August 2008

Among the 30-member Sensex pack, 19 declined while the rest gained.

Diversified major Grasim surged 3.45% to Rs 1899.50, off sharply from day’s low of Rs 1795. It was the top gainer from Sensex pack.

Other cement counters, UltraTech Cement Company (up 1.49% to Rs 575), Birla Corporation (up 3.99% to Rs 170.85), and ACC (up 1.66% to Rs 586.05), also logged gains.

Cement counters advanced 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.

India’s largest pharma company by sales, Ranbaxy Laboratories climbed up 2.80% to Rs 524 after the United States district court of Maryland has given 60 days time to the Indian drug maker to submit all documents sought by the Department of Justice through an information-seeking motion before the court on 3 July 2008.

Steel heavyweights gained on fresh buying. Tata Steel, India’s largest private sector steelmaker by sales advanced 1.36% to Rs 689.90. 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.

Steel Authority of India (SAIL) gained 4.46% to Rs 150.90. Reportedly the company has formed an equal stake joint venture with Manganese Ore India to produce 1 lakh tonnes of ferro alloys used for steel making. The investment for the venture would be Rs 400 crore.

JSW Steel (up 9.20% to Rs 870), Ispat Industries (up 9.37% to Rs 29.75), and Bhushan Steel (up 0.88% to Rs 945.05) rose.

Auto stocks showed mixed trend. Maruti Suzuki India gained 1.70% to Rs 570.05. On 1 August 2008, Maruti Suzuki India said its total sales rose 1.1% to 58,543 cars in July 2008 over July 2007. Domestic sales grew 0.1% to 52,911 units while exports climbed 11% to 5,632 units in July 2008 over July 2007.

India’s top truck market Tata Motors fell 1.03% to Rs 394.50 after the company reported a 3% decline in total sales to 40,729 units in July 2008 over July 2007. The company cited high interest rates and reducing finance availability for the decline.

However Mahindra & Mahindra, the country’s largest tractor maker by sales, fell 1.27% to Rs 517.05 after the company posted 16.45% decline in sales to 12,078 units in July 2008 over July 2007.

Hero Honda, the world’s largest two-wheeler maker in terms of sales rose 0.35% to Rs 798.55. The company logged 40% jump in sales to 2.81 lakh units in July 2008 over July 2007. Bajaj Auto was down 0.48% to Rs 342.10. The company reported a mere 4% growth in two-wheeler sales at 1.62 lakh units in July 2008 over July 2007.

Reliance Communication (RCom), the country’s second largest cellular services provider by of market capitalisation rose 0.58% to Rs 439.35. As per reports, Reliance Infratel, a unit of RCom is likely to defer its IPO plans as market regulator Securities and Exchange Board of India (SEBI)'s go ahead for the public issue is set to expire on 11 August 2008.

Jaiprakash Associates (up 2.55% to Rs 174.80) and Hindalco (up 1.03% to Rs 142.20) edged higher from Sensex pack.

IT pivotals showed mixed trend. Satyam Computer Services (up 0.98% to Rs 395), and Infosys Technologies (up 0.97% to Rs 1656), logged gains.

However India’s largest software services exporter TCS slumped 2.59% to Rs 817.50 on 3 lakh shares. It was the top loser from Sensex pack. India’s third largest software services exporter Wipro fell 0.49% to Rs 430.50

India’s largest private sector firm by market capitalization and oil refiner Reliance Industries declined 2.54% at Rs 2241.25 on 10.27 lakh shares. The stock moved in a range of Rs 2310 and Rs 2233.15 during the day.

Oil and Natural Gas Corporation (ONGC), the nation’s largest oil exploration company in terms of market capitalisation was down 1.69% to Rs 981. The shipping ministry has reportedly granted relief to the company on the issue of age of vessels it hires, thereby saving $8 billion investment planned by ONGC to bring new offshore vessels.

India’s largest power generation company in terms of sales, NTPC lost 0.98% to Rs 174.95. The company may reportedly enter into agreements with three Oman-based firms to set up power projects in the Gulf country. In return, the Indian firm plans to use their association to secure gas supplies for its plants.

DLF (down 1.37% to Rs 513), Bhel (down 2.25% to Rs 1717), and Larsen & Toubro (down 1.33% to Rs 2656.70), edged lower from Sensex pack.

Banking shares edged lower after firm start. ICICI Bank (down 0.87% to Rs 636.50), HDFC Bank (down 0.30% to Rs 1104), and State Bank of India (down 0.22% to Rs 1497), slipped from the frontline banking pack.

A whole host of stocks were locked in 20% upper circuit filter on momentum buying. LML (up 20% to Rs 12.02), GHCL (up 20% to Rs 79.95), Lloyds Steel (up 19.95% to Rs 14.13), Span Diagnostics (up 19.94% to Rs 76.40), and Sabero Organics (up 19.95% to Rs 20.52) surged.

Reliance Natural Resources topped the turnover charts on BSE with a turnover of Rs 469 crore followed by Reliance Capital (Rs 271.50 crore), Reliance Industries (Rs 233 crore), Essar Oil (Rs 220 crore) and Reliance Petroleum (Rs 177.75 crore), in that order.

Reliance Natural Resources also led the volumes chart on BSE with volumes of 4.50 crore shares followed by Ispat Industries (2.86 crore shares), IFCI (1.95 crore shares), Bellary Steels (1.15 crore shares) and Kashyap Technologies (1.11 crore shares), in that order.

Fertilser shares advanced on reports that the department of fertilizers has almost exhausted the budgetary allocation of Rs 31000 crore to the fertiliser sector and has requested for an additional Rs 66000 crore still pending with Ministry of Finance.

Chambal Fertiliser (up 0.55% to Rs 82.25), Bharat Fertiliser (up 5.95% to Rs 65), Coramandel Fertiliser (up 0.67% to Rs 172.10), and Tata Chemicals (up 4.51% to Rs 345.25), advanced.

Real estate stocks gained on fresh buying. Anant Raj Industries (up 4.25% to Rs 152.20), HDIL (up 4.20% to Rs 477.55), and Indiabulls Real Estate (up 4.06% to Rs 303.55), gained from realty space.

Essar Oil spurted 15.75% to Rs 230 on reports the company is in talks to sell petrol to Iran and has signed its first-ever term contract with Tehran to import 1.6 million barrels of crude oil every month.

HCL Technologies jumped 6.12% to Rs 220 despite reporting net loss of Rs 13.54 crore in Q4 June 2008 as against net profit of Rs 236.08 crore in Q3 March 2008. HCL Technologies’ net sales fell 13.16% to Rs 1107.75 crore in Q4 June 2008 over Q3 March 2008. The company accounted forex loss of Rs 306.7 crore for the year ended June 2008. The company announced the results after trading hours on Friday, 1 August 2008.

FDC surged 7.42% to Rs 36.20 after the company said its board will meet on 12 August 2008 to consider buy back of equity shares. The company made this announcement during trading hours today, 4 August 2008.

Monsanto India rose 2.68% to Rs 1528 after 4.32 lakh shares, or 5% of company's equity, changed hands in a block deal at Rs 1,488.15 on BSE.

Finance Minister P Chidambaram on Saturday, 2 August 2008 said the country has the potential to achieve 11% economic growth rate and also sustain it like China. He said the country has achieved around 9% growth rate in the last four years but that was not enough.

Meanwhile inflation is expected to cool down to 8-9% by March 2009 if the global crude oil prices do not go up from the current level, Prime Minister's Economic Advisory Council (EAC) Chairman C Rangarajan said. The EAC is expected to submit its report on outlook of Economy for 2008-09 next week. In January, the EAC had projected GDP growth of 8.5% for 2008-09.

With the Q1 June 2008 earnings season over, there is lack of any major near term trigger for the domestic bourses. Aggregate results of 1977 companies showed 37.3% rise in net profit on 5.1% rise in net sales in Q1 June 2008 over Q1 June 2007.

European markets, which opened after Indian market, were mixed. Key benchmark indices in Germany and France were down by between 0.23% and 0.49%. However UK’s FTSE 100 rose 0.31%.

Asian markets, which opened before Indian market, were trading lower today, 4 August 2008. Key benchmark indices in China, Japan, Hong Kong, Taiwan, Singapore, and South Korea were down by between 0.36% and 2.14%

Stocks fell on Wall Street on Friday, 1 August 2008 pushed by billions in losses at largest US automaker General Motors, higher unemployment figures and rising oil prices. The blue-chip Dow Jones Industrial Average dropped 51.70 points, or 0.5%, to 11,326.32. The broader Standard & Poor's 500 Index fell 7.07 points, or 0.6%, to 1,260.31. The technology- heavy Nasdaq Composite Index lost 14.59 points, or 0.6%, to 2,310.96.

Back home, local benchmark indices advanced on Friday, 1 August 2008 brushing aside weak global cues, as prospects of the Indo-US nuclear being operationalised took centre stage after the UN nuclear watchdog endorsed that India met all safeguard standards. The Bombay Stock Exchange's Sensex surged 300.94 points or 2.10% to 14,656.69,and the National Stock Exchange's Nifty ended gained 80.60 points or 1.86% to at 4413.55, on that day.

Deputy Finance Minister Pawan Kumar Bansal said that the coalition government has the support to push through three major reforms in the banking, insurance and pension sectors in the next parliamentary session, which is likely to begin on 11 August 2008.