Post Session Commentary - May 12 2009

Indian market rebounded sharply from its initial weakness to end the day with handsome gains on strong buying emerged during final trading hours. Recovery in European markets along with higher US index futures, also contributed to positive sentiments. However, data showing fall in industrial output in March 2009, fueled some negative attitude during mid session. Further, market recovered and extended gains after the government revised the industrial production for February 2009 to a 0.7% fall as compared to the decline of 1.2% earlier.

The market opened on weak note tracking unfavorable cues from the global markets. The US stock markets on Monday closed lower retreating from four-month high, with the financial sector came into pressure as several major banks said they would sell shares to repay government bailout funds. Asian markets were also lower in early trade. However, the Indian benchmark indices gained ground soon after start to trade in positive terrain. Further, market again touched the dotted line due to fall in industrial output for March 2009. However, market managed to gather the momentum and continued to extend gains till end on revision in industrial production for February 2009. Finally market ended near day’s high backed by huge buying interest over the ground. BSE Sensex ended above 12,100 level and NSE Nifty above 3,650 mark. From the sectoral front, investors on-loaded positions across the sectors. Besides, Teck, IT, Bank, Oil & Gas, Reality, Power, Capital Goods and Consumer Durables stocks contributed to most of the buying. Mid Cap and Small Cap stocks also remained on buyers’ radar.

Among the Sensex pack 29 stocks ended in green territory and 1 in red. The market breadth indicating the overall health of the market remained positive as 1410 stocks closed in green while 1101 stocks closed in red and 75 stocks remained unchanged in BSE.

The BSE Sensex closed higher by 475.04 points at 12,158.03 and NSE Nifty ended up by 126.50 points at 3,681.10. BSE Mid Caps and Small Caps closed with gains of 34.82 and 55.39 points at 3,746.24 and 4,240.71 respectively. The BSE Sensex touched intraday high of 12,194.63 and intraday low of 11,625.39.

Gainers from the BSE Sensex pack are HDFC (7.66%), Wipro (7.40%), ICICI Bank (6.72%), Bharti Airtel (6.23%), Infosys Tech (5.51%), Reliance (5.32%), Hindalco (5.31%), BHEL (5.12%), JP Associates (4.24%), M&M Ltd (4.13%), RCom (4.04%), HDFC Bank (3.92%), Tata Motors (3.89%) and Reliance Infra (3.87%).

Only loser from the BSE Sensex pack is HUL (0.44%).

India''s industrial production plunged 2.3% in March from 5.5% rise in the same month of 2008 and as against a decline of 0.7% in February. The government revised the industrial production for February 2009 to a 0.7% fall compared to the decline of 1.2% earlier. 23% fall is the worst performance for the IIP since January 1993. The plunge is mainly due to weak performance by the manufacturing sector, the output of which contracted by 3.3 per cent during March. The capital goods sector was the worst hit which fell 8.2% against growth 20.3% in the same period a year ago.

On the global markets front the Asian markets which opened before the Indian market, ended mixed. Hong Kong shares were supported by HSBC Holdings after a sharp upbeat trading report on Monday. However, Japanese and South Korean stocks dropped as investors booked profits in financial shares after recent gains. Shanghai Composite, Hang Seng and Straits Times index ended up by 38.43, 65.69 and 12.03 points at 2,618.17, 17,153.64 and 2,178.13 respectively. However, Nikkei 225 and Seoul Composite ended lower by 153.37 and 11.65 points at 9,298.61 and 1,403.51 respectively.

European markets which opened after the Indian market are trading mixed. In Frankfurt the DAX index is trading higher by 25.96 points at 4,892.87 while in London FTSE 100 is trading down by 9.49 points at. 4,426.01.

The BSE IT stocks also advanced by (5.19%) or 140.06 points to close at 2,836.77 weak rupee boosts revenues of IT firms in rupee terms as IT companies earn most of revenue from exports. Wipro Ltd (7.40%), Financ Tech (5.52%), Infosys Tech (5.51%), Mphasis Ltd (5.02%) and Moser Bayer (3.39%) ended in positive territory.

The BSE Teck index increased by (5.04%) or 110.32 points at 2,297.63. Main gainers are Wipro Ltd (7.40%), Bharti Airtel (6.23%), Idea Cell (5.57%), Financ Tech (5.52%) and Infosys Tech (5.51%).

The BSE Bank index gained (4.83%) or 288.82 points to close at 6,250.68. Major gainers are Kotak Bank (9.47%), Axis Bank (8.17%), Allahabad Bank (7.34%), ICICI Bank (6.72%) and PNB (5.93%).

The BSE Oil & Gas index gained (3.97%) or 330.49 points at 8,660.19. Scrips that gained are Reliance (5.32%), Reliance Pet (5.17%), Gail India (3.89%), HPCL (3.67%) and Cairn Indi (2.06%).

The BSE Realty index ended up by (3.77%) or 84.30 points to close at 2,317.57 on hopes that lower rates will spur housing demand. Gainers are Housing Dev (8.16%), Unitech Ltd (6.03%), Orbit Co (4.32%), DLF Ltd (3.55%) and Mahindra Life (3.09%).

The BSE Power ended higher by (3.02%) or 64.39 points at 2,199.87. Gainers are Suzlon Energy (8.02%), BHEL (5.12%), RPower (4.41%), Power Grid (4.06%) and Reliance Infra (3.87%).

Infrastructure Development Finance Company Ltd advanced 3.72% after a block deal of 5.28 lakh shares was executed on BSE at Rs. 88.25 per share.

United Breweries Ltd jumped 5.01% on reports the company will bottle and distribute Heineken brands in India and will get a one-time fee of Rs. 300 crore.

TCS ended up by 3.57%. The company announced that Forrester, an independent research firm, cited TCS as a leader in its April 2009 report titled "The Forrester Wave".

Nucleus Software Exports Ltd advanced 1.40%. The company has acquired a new client, the Bank of Bahrain and Kuwait (BBK), one of the largest commercial banks in Bahrin. Company’s cash management solution CASH@WILL and BankONet modules, will be implemented by the Bank of Bahrin and Kuwait for the transaction banking services.

Patni Computer gained 0.21%. The company announced that its iCAPA Solution 2.0 for life sciences has achieved SAP certification as powered by the SAP NetWeaver technology platform.

KEC International advanced by 4.22%. The company has bagged three orders totaling to Rs 111 crores in the Middle East, Australia and India.

JSW Steel ended down by 1.39% on the back of a decision to sell its plants in the US to cut rising losses, after a sharp fall in demand triggered by the global economic slump.