Post Session Commentary - May 29 2009

The domestic market closed the session on a strong note backed by heavy buying across the sectoral indices. The rally was supported by better than expected fourth quarter GDP growth that boosted the expectations that the economy will grow at a faster pace this fiscal. India’s GDP grew a faster than expected 5.8 percent in the March quarter from a year earlier. Adding to this, the comments from oil minister, Murli Deora that he would seek the approval of the cabinet for the oil price deregulation in the next 6 to 8 weeks, which spurred the oil and energy stocks to witnesses hue buying. Moreover, the positive global cues also supported the investors sentiments.

The market opened the session with decent gains tracking the positive global markets and favoring cues from the domestic markets and kept on marching forward for the most part of the session. The market gained further momentum on GDP numbers and continued its northward journey. However, the market comes off marginally from the day’s in the final hours on selective profit booking. Moreover, in the global arena, the US market closed in green on the back of a surprise auction of the 7-year Treasury Note auction. The auction’s bid-to-cover ratio came in just below 2.3 which was parallel with the prior three similar auctions. The yield on the 10-year note increased by 28 ticks to 3.64% 2009 high. Also added to the sentiments was the new-home sales up 0.3% to a seasonally adjusted rate of 352,000 in April 2009, less than expected. Along with this, the continuing jobless claims stands at 6.8 million and the initial data of weekly claims recorded at 6,23,000. However, benchmark indices gained strength during the session with BSE Sensex closed above 14,727.28 level and NSE Nifty above 4,440 mark. From sectoral front, investors on-loaded position across the sectors led by Realty, Capital Goods, Consumer Durables, Auto and Oil & Gas index.

The GDP for the fourth quarter of the current fiscal stood at 5.8% from a year earlier. However, the GDP for the current fiscal 2008-09 as a whole was down 6.7% as against the previous projection of 7.1%. The previous fiscal GDP was 8.8%. During the January-March quarter, the manufacturing sector contracted 1.4 percent from a year earlier, while the farm output grew an annual 2.7 percent, government data showed on Friday.

Among the Sensex pack 26 stocks ended in green territory and 4 in red. The market breadth indicating the overall health of the market remained firm as 2,147 stocks closed in positive while 649 stocks closed in negative and 56 stocks remained unchanged in BSE.

The BSE Sensex closed up by 329.24 points or 2.30% at 14,625.25 and NSE Nifty closed higher by 111.85 points or 2.58% at 4,448.95. BSE Mid Caps and Small Caps closed with gains of 121.18 and 175.13 points at 5,056.74 and 5,986.82. The BSE Sensex touched intraday high of 14,727.28 and intraday low of 14,319.87.

Gainers from the BSE Sensex pack are ACC Ltd (8.56%) followed by Dlf (8.41%), JP Associates (8.21%), TCS (6.05%), Tata Steel (5.92%) and M&M (5.67%).

Losers from the BSE Sensex pack are Sun Pharma (8.24%) along with Grasim industries (3.59%), Tata Power (2.47%) and ITC (0.05%).

On the global markets front the Asian markets which opened before the Indian market, closed in green. Hang Seng, Strait Times, Nikkei and Seoul Composite closed up by 1.60%, 1.57%, 0.75%, 0.27% at 18,171, 2,329.08, 9,552.50 and 1,395.89 respectively.

European markets which opened after the Indian market are trading in green. In Frankfurt the DAX index is trading up by 1.38% at 5,001.17 and in London FTSE 100 is trading higher by 1.36% at 4,447.35.

The BSE Realty index surged (6.76%) or 241.95 points to close at 3,819.89. Main gainers are Ansal Infra (9.58%), India Bull Real (9.13%), Phoenisx Mill (9.09%), DLF (8.41%), Orbit Co (7.74%) and Omaxe Ltd. (5.67%).

The BSE Capital Goods index surged (4.13%) or 472.67 points at 11,921.39. Scrips that mostly gained are Reliance Industrial Infra (13.56%), Jyothi Structure (9.98%), AIA Engineeering (8.04%), Punj Lloyd (7.55%), L&T (4.75%) and Praj Industries (4.45%).

The BSE CD index also ended higher by (3.55%) or 94.59 points at 2,758.07. Blue Star (6.23%), Videocon Industries (5.22%), Titan Industries (4.19%), Gitanjali Gems (1.35%) and Rajesh Export (0.56%) ended in positive territory.

The BSE Auto index grew (3.41%) or 151.95 points to close at 4,610.61. Gainers are Ashok Leyland (8.71%), Bajaj Auto (8.27%), Mahindra & Mahindra (5.67%) and Maruti Suzuki (2.32%).

The BSE Oil and Gas advanced (3.31%) or 333.60 points at 10,419.47. Gainers are HPCL (8.33%), Indian Oil (6.90%), Cairn India (6.12%), Gail India (5.01%), RPL (3.75%) and Aban Offshore (3.51%).

The BSE Metal stocks gained (3.11%) or 328.47 points to close at 10,878.42. Gainers are NMDC (6.35%), Tata Steel (5.92%), SAIL (5.17%), Jai Corp (5%) and Hindalco Industries (3.93%).

The BSE IT increased (2.37%) or 69.40 points at 2,997.55. Gainers are Financial Technologies (8.56%), TCS (6.05%), Wipro (3.57%) and Tech Mahindra (2.22%).

Bank of India surged 4.21% to close at Rs337.85. The bank has announced the Audited Consolidated results for the Year ended March 31, 2008. The Group has posted a net profit of Rs 30875.40 million for the year ended March 31, 2009 as compared to Rs 19598.40 million for the year ended March 31, 2008. Total Income has increased from Rs 145284.10 million for the year ended March 31, 2008 to Rs 194930.50 million for the year ended March 31, 2009.

Indian Oil Corporation Ltd galloped 6.90% to Rs609.30. The company has posted a net profit of Rs 66229.60 million for the quarter ended March 31, 2009 where as the same was net loss at Rs (4142.70) million for the quarter ended March 31, 2008. Total Income is Rs 605998.00 million for the quarter ended March 31, 2009 where as the same was at Rs 717928.20 million for the quarter ended March 31, 2008.

Tata Motors Ltd shot up 1.22% to close at Rs336.70. The company has posted a net profit of 10012.60 million for the year ended March 31, 2009 as compared to Rs 20289.20 million for the year ended March 31, 2008. Total Income has decreased from Rs 292225.90 million for the year ended March 31, 2008 to Rs 265867.60 million for the year ended March 31, 2009.

IVRCL Infrastructures & Projects Ltd closed up by 9.17% at Rs329.15. The company has posted a net profit of Rs 798.823 million for the quarter ended March 31, 2009 as compared to Rs 733.028 million for the quarter ended March 31, 2008. Total Income has increased from Rs 13227.416 million for the quarter ended March 31, 2008 to Rs 16359.305 million for the quarter ended March 31, 2009.