Post Session Commentary - March 18 2009

Indian market ended today in green zone on sustained buying in key stocks. Though, market came off the day’s high after a sharp surge ahead of the closing of the two day US Federal Reserve meeting. Strong cues form the global markets contributed to the rally in domestic bourses. Asian markets closed with good gains tracking Wall Street gains overnight. Along with this, positive trend in European markets also contributed to the northward journey.

The market opened on pleasant note mirroring firm global cues. The US stock markets on Tuesday ended higher on the back of surprise increase in the February housing starts and building permits. Further, domestic stocks continued to gain ground on significant buying led by strong sentiments. However, during final trading hours benchmark indices observed some dive from day’s high as investors booked gains after a decent journey. Finally market ended with growth despite giving up some gains from the day''s high. BSE Sensex breached 9,000 mark during trading but finally retreated from that level and NSE Nifty ended around 2,800 level after breaking 2,800 during the trading. From the sectoral front, traders on-loaded position across majority of sectors. Besides, Reality, Metal, Capital Goods, Bank, Oil & Gas, Consumer Durable and Power stocks were in limelight as witnessed most of the buying from these baskets. Further, BSE Mid Cap and Small Cap stocks also closed with decent gains. However, offloading was seen only in FMGC stocks.

Among the Sensex pack 23 stocks ended in green territory and 7 in red. The market breadth indicating the overall health of the market remained strong as 1552 stocks closed in green while 930 stocks closed in red and 108 stocks remained unchanged in BSE.

The BSE Sensex closed higher by 112.86 points at 8,976.68 and NSE Nifty ended up by 37.25 points at 2,794.70. BSE Mid Caps and BSE Small Caps ended with gains of 63.55 and 54.17 points at 2,759.90 and 3,064.48 respectively. The BSE Sensex touched intraday high of 9,120.46 and intraday low of 8,951.32.

Gainers from the BSE Sensex pack are DLF Ltd (7.76%), JP Associates (6.46%), Tata Steel (4.54%), BHEL (4.28%), Reliance Infra (3.51%), ICICI Bank (3.41%), Sterlite Industries (3.13%), Hindalco (3.09%), L&T Ltd (3.05%), Tata Motors (2.56%) and Reliance (2.38%).

Losers from the BSE Sensex pack are M&M Ltd (4.09%), Tata Power (2.40%), ITC Ltd (2.11%), ACC Ltd (1.46%), HDFC (0.76%), HUL (0.45%) and Bharti Airtel (0.33%).

International Monetary Fund (IMF) said on Tuesday that India’s economy is slowing considerably and uncertainty surrounding the outlook in unusually large. The IMF predicted the India’s gross domestic product growth may slow to 6.3 per cent in the fiscal year 2008-2009, ending in March, and to 5.3 per cent the following year. That would be lower than the 9 per cent growth rate in the 2007-2008 year.

On the global markets front the Asian markets which opened before the Indian market, ended in green led by financial and auto companies. Bank of Japan today kept interest rates unchanged at 0.1% at a policy meeting but said it may provide subordinated loans to help banks replenish capital. Shanghai Composite, Hang Seng, Nikkei 225, Straits Times index and Seoul Composite ended higher by 5.40, 239.08, 23.04, 16.91 and 6.07 points at 2,223.72, 13,117.17, 7,972.17, 1,575.94 and 1,169.95 respectively.

European markets which opened after the Indian market are trading in green. In Frankfurt the DAX index is trading up by 53.16 points at 4,040.93 and in London FTSE 100 is trading slightly higher by 0.93 points at 3,858.03.

The BSE Reality index outperformed the benchmark indices as ended up by (7.65%) or 112.51 points at 1,584.05 on hopes lower rates will spur housing demand. Gainers are Akruti City (27.53%), Orbit Co (17.91%), Mahindra Life (8.42%), DLF Ltd (7.76%) and Penland Ltd (6.68%).

The BSE Metal stocks also witnessed rally as advanced by (3.47%) or 172.56 points to close at 5,146.58 on rise in metal prices on London Metal Exchange. Major gainers are Welspan Gujarat SR (13.78%), Hindustan Zinc (5.68%), Steel Authority (5.19%), Tata Steel (4.54%) and Jindal Steel (3.72%).

The BSE Capital Goods index gained (3.18%) or 187.60 points to close at 6,084.40. Main gainers are Walchand In (15.81%), Kalpat Power T (12.21%), Elecon Eng C (10%), Havells India (8.33%) and Gammon Indi (7.81%).

The BSE Bank index closed with increase of (2.63%) or 105.23 points at 4,110.99 on rally in bond yield and on hopes lower interest rates may boost investors’ sentiments. Scrips that gained are Federal Bank (9.97%), Bank of Baroda (4.79%), Axis Bank (4.74%), Punjab National Bank (3.85%) and Oriental Bank (3.43%).

The BSE Consumer Durable index ended higher by (1.73%) or 26 points to close at 1,531.47. Rajesh Export (8.39%), Gitanjali GE (2.41%), Videocon Ind (1.34%), Titan Ind (1.11%) and Blue Star L (0.84%) ended in positive territory.

The BSE FMCG index lost (1.14%) or 22.19 points to close at 1,924.08. Losers are United Spr (2.73%), Godrej Cons (2.72%), ITC Ltd (2.11%), Tata Tea Ltd (1.21%) and Colgate Palm (0.08%).

Tata Motors advanced by 2.56%. The company on Wednesday said it has entered into an agreement with Andhra Bank for financing its range of passenger vehicles, which will provide an added facility of car finance to its customers. Tata Motors said that this deal is based on the bank''s wide reach with a large industrial as well as retail clientele.

Satyam Computer gained 0.80% on report that the company received a fresh order from a food company based in Europe. In the latest development, the Board has placed norms for the winner of the bid, including no sale of the company''s assets for 3 years, not to pledge them to raise debt, no sudden lay-off of employees and should hold enough cash to infuse immediately.

Videocon Industries increased by 1.34%. The company has decided to hold its incursion into the mobile phones category by a year. It has also decided to put on hold its plan for a consumer electronics retail foray across West Asia, Europe, Africa and Latin America under the brand name ‘VC’. Reason behind the decision is current market condition and economic turmoil.

State Bank of India rose 1.20%. The bank is attracting the private bank customers after it launched the special housing loan schemes recently at 8% interest rate. This rate has prompted passage of customers of some private banks to SBI.

Maytas Infra Ltd (MIL) gained 3.98%. It has requested the government to grant more time for achieving financial closure for Metro Rail Project.