Sensex regains 9,000 level; breadth just about positive

Frenzied buying in index pivotals, bouts of short covering ahead of the expiry of January 2009 series derivatives contracts on Thursday, 29 January 2009 and positive global cues powered a solid rally on the bourses. The BSE 30-share Sensex surged 329.73 points, or 3.8% to close above the psychological 9,000 mark. Index heavyweight Reliance Industries (RIL) anchored rally with over 6% surge. Metal, IT, and banking shares were the start performers of the day. Despite the rally, market breadth was just about positive, as small and mid-cap shares pared early gains.

Except for an odd early afternoon hiccup which was a knee jerk reaction to the Reserve Bank of India (RBI) maintaining its status quo on interest rates, market displayed firmness throughout the day.

The RBI left its repo rate, reverse repo rate and the cash reserve ratio (CRR) unchanged in its third quarter review of the Monetary Policy for 2008-09, unveiled today, 27 January 2009. However, the central bank cut its growth forecast for the fiscal year ending March 2009 on a slowdown in industry and services and assuming normal agricultural production. GDP growth projection for 2008/09 was lowered to 7% from 7.5-8% earlier. The economy has grown at 9% or more for the past three fiscal years. The central added the inflation by the end of March 2009 would be signficantly lower than the projected 7%.

Volatility may swell in the coming days as futures & options contracts for January 2009 series expire on Thursday, 29 January 2009. As per reports, rollover of Nifty positions from January 2009 series to February 2009 series was 38% while marketwide rollover of positions stood at 31%, as on Friday, 23 January 2009.

Globally, the two-day policy setting meeting of the U.S. Federal Reserve starting today, 27 January 2009 and the $825 billion US stimulus package by the Republican lawmakers which will be picked up by the Senate this week and President Barack Obama could reportedly sign the bill by mid- February 2009, will be closely watched.

Trading in the US index futures showed the Dow could rally 46 points at the opening bell. European shares fell on Tuesday, as banks retreated after hefty gains in the previous session and mining shares slipped on growth concerns with key benchmark indices in France, Germany and UK declining by between 1.02% to 1.49%.

Asian stocks gained today, 27 January 2009, as US economic indicators gave a hope that demand for commodities and Japanese-made goods will improve. Japanese benchmark index Nikkei jumped 4.93%. Stock markets in Hong Kong, China, Taiwan, Korea and Singapore will remain shut today, 27 and tomorrow, 28 January 2009 for the Lunar New Year holidays.

US stocks ended higher on Monday, 26 January 2009, on news that drug maker Pfizer will buy opponent Wyeth for $68 billion and on a sudden rise in sales of existing homes in December 2008. The Dow Jones industrial average increased 38.47 points, or 0.48%, to end at 8,116.03. The Standard & Poor`s 500 index climbed 4.62 points, or 0.56%, to settle at 836.57. The Nasdaq Composite index increased 12.17 points, or 0.82%, to close at 1,489.46.

Foreign institutional investors (FIIs) are in selling mode after an inflow of Rs 1319.10 crore in December 2008. Their outflow in January 2009 totaled Rs 3950.20 crore (till 22 January 2009).

The BSE 30-share Sensex was up 329.73 points, or 3.8%, to 9,004.08. The Sensex rose 347.62 points at the day's high of 9,021.97 in late trade. The Sensex rose 114.71 points at the day's low of 8,789.06 in early trade.

Stock markets remained shut on Monday, 26 January 2009, on account of Republic day. The market fell for the third straight week ended Friday, 23 January 2009 on weak global cues and subdued December 2008 quarter earnings from blue chip companies A rise in wholesale inflation rate for the week ended 10th January also dampened sentiment. The BSE Sensex lost 649 points or 6.96% for the week to 8,674, and the S&P CNX Nifty fell 150 points or 5.29% to 2,679.

The BSE Sensex has lost 643.23 points or 6.66% so far in 2009 from its close of 9647.31 on 31 December 2008. The barometer index had lost 10639.68 points or 52.44% in the calendar year 2008

The market breadth indicating the overall health of the market, was positive on BSE today with 1,233 shares advancing as compared with 1,196 that declined. 66 shares remained unchanged. The breadth was strong in early trade.

The BSE clocked a turnover of Rs 3,069 crore today.

Nifty January 2009 futures were near spot price at 2772, compared to the spot closing of 2771.35. Turnover in NSE's futures & options (F&O) segment increased to Rs 42,867.49 crore from Rs 36,809.97 crore on Friday, 23 January 2009. The January 2009 derivatives contract will expire on Thursday, 29 January 2009.

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

Sectoral indices on BSE displayed mixed trend. the BSE Metal index (up 5.55%), the BSE Power index (up 4.66%), the BSE Teck index (up 4.39%), the BSE IT index (up 4.05%) outperformed the Sensex.

The BSE Consumer Durables index (up 0.38%), the BSE FMCG index (up 1.05%), the BSE HealthCare index (up 1.23%), the BSE PSU index (up 1.25%), the BSE Capital Goods index (up 1.55%), the BSE Auto index (up 1.72%), the BSE Realty index (up 2.19%), the BSE Bankex (up 2.91%), the BSE Oil & Gas index (up 3.35%), underperformed the Sensex.

India's largest private sector company by market capitalization and oil refiner Reliance Industries (RIL) rose 6.41% to Rs 1,227.05. The company after market hours on Thursday, 22 January 2009 announced a lesser than expected 8.8% fall in net profit to Rs 3501.crore in Q3 December 2008 over Q3 December 2007. RIL's net profit dipped for the first time in three years, but beat forecasts as refining margins did not fall as much as expected. RIL earned $10 on every barrel of crude oil processed at its 660,000 barrel-a-day plant at Jamnagar in Gujarat, higher than other refineries in South Asia.

However India's largest oil exploration firm by revenue Oil & Natural Gas Corporation fell 3.84% on rise in crude oil prices.

Oil prices rose more than 1% on Tuesday, reversing day-ago losses as traders focused on short-term factors like cold U.S. weather and an Australian cyclone, despite forecasts of a further rise in U.S. crude stocks. U.S. light, sweet crude for March delivery rose 52 cents to $46.25 a barrel.

Metal stocks surged on firm commodities prices on London Metal Exchange. Hindalco Industries, Hindustan Zinc, Tata Steel, National Aluminum Company rose by between 1.38% to 9.11%.

Sterlite Industries rose 11.84% even after it reported 11.6% fall in net profit to Rs 204.01 crore on 2% fall in sales to Rs 2,583.08 crore in Q3 December 2008 over Q3 December 2007. It was the top gainer from the Sensex pack.

India's second largest steel maker by sales Steel Authority of India rose 3.14% even after its net profit fell 56.4% in Q3 December 2008 over Q3 December 2007.

IT stocks rose on firm ADRs overnight in the US. India's third largest software services exporter, Wipro rose 5.75 % as its ADR rose 1.66% overnight. The company forecasted a 7% fall in revenue for Q4 March 2009 on global economic downturn and pricing pressure from western clients, at the time of declaring results before market hours on 21 January 2009.

India's second largest software services exporter Infosys Technologies rose 3.97% as its ADR rose 2.46% overnight. While, India's fifth largest IT exporter by sales HCL Technologies rose 5.09% after its net profit rose 56.82% to Rs 398.01 crore on 10.97% rise in sales to Rs 1,304.85 crore in Q2 December 2008 over Q1 September 2008.

TCS, India's largest software services exporter by sales rose 2.9%.

Banking stocks rose after an odd blip in midmorning trade when the Reserve Bank of India kept its key rates unchanged in its credit policy today, 27 January 2009. India's largest bank in terms of assets and branch network State Bank of India rose 4.5% after its net profit rose 37.03% to Rs 2478.42 crore in the quarter ended December 2008 as against Rs 1808.64 crore during the previous quarter ended December 2007. Total operating income rose 42.34% to Rs 18030.34 crore in the quarter ended December 2008 as against Rs 12666.82 crore during the previous quarter ended December 2007. The bank announced the result on 24 January 2008.

India's second largest private sector bank by net profit HDFC Bank rose 1.93% as its American depository receipt (ADR) rose 1.1% on Monday, 26 January 2009.

India's largest private sector bank by net profit ICICI Bank rose 4.68% even as its ADR fell 1.08% overnight. Net profit of ICICI Bank rose 3.41% to Rs 1272.15 crore in the quarter ended December 2008 as against Rs 1230.21 crore during the previous quarter ended December 2007. Total operating income declined 0.96% to Rs 7836.08 crore in the quarter ended December 2008 as against Rs 7911.77 crore during the previous quarter ended December 2007. The unexpected rise in net profit was because earnings from fees and bond trading offset slowing credit growth and rise in bad loans. The bank announced the result on Saturday, 24 January 2008.

India's largest dedicated housing finance company by total income HDFC rose 4.18%.

Auto shares rose on hopes lower interest rates and fall in fuel prices would spur demand for vehicles which is mainly driven by finance. India's largest commercial vehicle maker by sales Tata Motors rose 3.85% on recent reports the much delayed and much awaited Tata Nano is ready to hit the dealer networks by February 2009 end. Both the “base” model and the “fully loaded” model will be available at the dealer showrooms mid-to late February. Meanwhile company which bought the luxury brands Jaguar and Land Rover from Ford Motor last year, is in reportedly in talks with the UK government on assistance for the luxury units as sales plummet in their largest markets.

Among other auto stocks, Maruti Suzuki India, M&M and Hero Honda Motors rose by between 1.53% and 4.29%.

Rate sensitive real estate shares rose on hopes lower rates will spur housing demand. HDIL, Indiabulls Real Estate Omaxe, Unitech, DLF, Akruti City rose by between 0.89% to 7.51%.

Power stocks rose. Tata Power Company, Reliance Infrastructure, Reliance Power, Power Grid Corporation of India rose by between 3.25% to 11.14%.

NTPC rose 5.99% after its net profit rose 26.5 % to Rs 2,250.91 crore on 20.9% rise in sales to Rs 11,277.06 crore in Q3 December 2008 over Q3 December 2007.

India's second largest telecom services provider by sales of Reliance Communication rose 7.15% even after its net profit declined 9.04% to Rs 397.04 crore in the quarter ended December 2008 as against Rs 436.48 crore during the previous quarter ended December 2007. Sales declined 2.04% to Rs 3334.22 crore in the quarter ended December 2008 as against Rs 3403.52 crore during the previous quarter ended December 2007.

India's largest FMCG major by sales Hindustan Unilever rose 2.51% even after reporting a 2.48% fall in net profit in Q3 December 2008 over Q3 December 2007.

Cadila HealthCare rose 2.56% after its net profit rose 14.5% in Q3 December 2008 over Q3 December 2007.

Power stocks rose. Tata Power Company, Reliance Infrastructure, Reliance Power, Power Grid Corporation of India rose by between 2.44% to 11.22%.

NTPC rose 5.6% after its net profit rose 26.5 % to Rs 2,250.91 crore on 20.9% rise in sales to Rs 11,277.06 crore in Q3 December 2008 over Q3 December 2007.

India's largest engineering and construction firm by sales Larsen & Toubro (L&T) fell 0.41% after it hiked stakes in Satyam Computer Services from 4.48% to 12.04%. It acquired additional 7.56% stake in open market purchases at average price of Rs 34.5per share. The company's stake hike is an attempt to secure Satyam's board seat. While Satyam Computer Services jumped 21.36%.

REI Agro fell 2.49% after its net profit declined 92.29% to Rs 2.0389 crore in Q3 December 2008 over Q3 December 2007.

Divi's Laboratories slumped 8.46% after the company reported an 18.1% fall in net profit to Rs 82.42 crore in Q3 December 2008 over Q3 December 2007.

Sun TV Network jumped 4.43% after the company reported a 9.7% rise in net profit to Rs 112.24 crore in Q3 December 2008 over Q3 December 2007.

Asian Paints lost 12.69% after the company reported a 53.5% slide in net profit to Rs 50.11 crore in Q3 December 2008 over Q3 December 2007.

Satyam Computer Services clocked the highest volume of 4.85 crore shares on BSE. Unitech (1.18 crore shares), Cals Refineries (1.1 crore shares), GVK Power & Infrastructure (88.61 lakh shares) and Reliance Natural Resources (71.52 lakh shares) were the other volume toppers in that order.

United Spirits clocked the highest turnover of Rs 327.70 crore on BSE. Satyam Computer Services (Rs 226.10 crore), Reliance Industries (Rs 212.88 crore), Educomp Solutions (Rs 131.16 crore) and Reliance Infrastructure (Rs 128.22 crore) were the other turnover toppers in that order.