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Friday, June 12, 2009

Post Session Commentary - June 12 2009


Indian market lost ground after mid session to close in negative terrain due to selling pressure emerged on profit taking after sharp rise in preceding sessions. Meanwhile, the IIP number for the month of April came in at 1.4% as against a revised 0.75% fall in March. The better than expected industrial production data raised fears that the rate cutting sequence may come to an end earlier than expected. Besides, negative European markets also fueled the weak sentiments.

The market opened above the yesterday’s closing tracking positive cues from the markets all over the world. Asian stocks were higher in early trade and the US stock markets on Thursday ended up with all three major benchmarks closing at multi-month highs backed by a sharp rise in retail sales and a bigger-than-expected dip in jobless claims. Moreover, in the Advance Retail Sales Report, both total retail sales and retail sales less autos increased 0.5%, which marked the first increase in three months. Total sales were in-line with expectations, while sales excluding autos were actually stronger than expected. Further, domestic benchmark indices continued to gain till mid session backed by firm Asian markets. However, stocks were unable to prolong the same impetus and slipped lower after report of rise in IIP data. Finally market ended with losses on account of selling pressure observed in key stocks. BSE Sensex ended below15,300 level and NSE Nifty below 4,600 mark. From the sectoral front, Realty, Auto, Teck, Consumer Durable, Capital Goods, Bank and Power stocks contributed to most of the selling pressure. Mid Cap and Small Cap stocks also followed the same trend. However, Metal and Oil & Gas stocks managed to gain favour from the market.

Among the Sensex pack 26 stocks ended in red territory and 4 in green. The market breadth indicating the overall health of the market remained negative as 2020 stocks closed in red while 706 stocks closed in green and 48 stocks remained unchanged in BSE.

The BSE Sensex closed lower by 173.53 points at 15,237.94 and NSE Nifty ended down by 54.30 points at 4,583.40. BSE Mid Caps and Small Caps closed with losses of 112.55 and 135.78 points at 5,235.03 and 6,014.66 respectively. The BSE Sensex touched intraday high of 15,600.30 and intraday low of 15,174.28.

Losers from the BSE Sensex pack are Ranbaxy Lab (6.03%), DLF Ltd (5.80%), RCom (4.38%), M&M Ltd (3.92%), Tata Motors (3.69%), SBI (3.49%), Reliance Infra (3.14%), Wipro Ltd (1.74%), Bharti Airtel (2.83%) and HDFC (2.76%).

Gainers from the BSE Sensex pack are Reliance (2.48%), Sterlite Industries (2.26%), ONGC Ltd (0.80%) and Tata Steel (0.78%).

The industrial output production (IIP) number for the month of April came in at 1.4% as against a revised 0.75% fall in March. The industrial output was 6.2% in the same month of the previous year. The manufacturing output for April has gone up to 0.7% and the mining output surged 3.8% (Y-o-Y).

On the global markets front the Asian markets which opened before the Indian market, ended mixed. Improving economic data from China and US supported the markets. According to the government, China retail sales and industrial output grew strongly in May amid heavy stimulus spending. That followed figures showing domestic investment in factories, real estate and other fixed assets soared 32.9% in the first five months of the year, even as exports and imports tumbled in May. Hang Seng, Nikkei 225 and Seoul Composite ended higher by 98.65, 154.49 and 9.2 points at 18,889.68, 10,135.82 and 1,428.59 respectively. However, Shanghai Composite and Straits Times index closed down 53.56 and 4.74 points at 2,743.76 and 2,377.07 respectively.

European markets which opened after the Indian market are trading in red. In Frankfurt the DAX index is trading lower by 22.08 points at 5,085.18 and in London FTSE 100 is trading down by 7.33 points at. 4,454.54.

The BSE Realty index decreased by (2.49%) or 93.37 points to close at 3,662.11. Main losers are Housing Development (5.82%), DLF Ltd (5.80%), Orbit Co (4.30%), Parsvnath (3.05%) and Pheonix Mill (3.02%).

The BSE Auto stocks also lost (2.41%) 121.15 points to close 4,897.83 on profit taking after recent surge. Major losers are Ashok Leyland (4.75%), Apollo Tyre (4.48%), Escorts Ltd (4.45%), Exide Indus (4.15%) and M&M Ltd (3.92%).

The BSE Teck ended down by (2.40%) or 65.68 points 2,674.21. Losers are IOL Netcom (8.37%), Tech Mahindra (6.63%), Deccan Chronicle (6.37%), IBN18 (6.21%) and Mahindra Life (5.40%).

The BSE Consumer Durable index dropped by (2.29%) or 70.30 points at 2,999.77. Gitanjali GE (7.10%), Rajesh Ecport (4.37%), Videocon Ind (3.04%), Blue Star L (2.04%) and Titan Ind (0.44%) ended in negative territory.

The BSE Capital Goods index lost (2.27%) or 302.25 points to close at 12,992.66. Losers are Usha Martin (5.61%), Punj Lloyd (5.20%), Elecon Eng C (4.99%), Gammon Indi (4.98%) and Aiaengineer (4.08%).

The BSE Metal index advanced by (1.93%) or 231.75 points at 12,220.75 as LMEX, a gauge of six metals traded on the London Metal Exchange leapt 4.2% overnight. Scrips that gained are JSW Steel (11.31%), Hindustan Zinc (7.85%), Sesa Goal TD (5.62%), Jindal Steel (5.14%) and Welspan Gujarat Sr (3.20%).

Ciba India Ltd deteriorated by 11.55% after the company posted net loss of Rs. 11.90 crore in Q4 March 2009 as compared with net profit of Rs. 2.90 crore in Q4 March 2008.

Bharat Heavy Electricals Ltd slipped 2.45% despite it has secured orders worth Rs 4015 crore from Hindalco Industries to supply power generation equipment.

Sesa Goa Ltd surged 5.62% after it acquired Goa-based V S Dempo Mining Corporation for Rs 1750 crore in an all-cash deal to boost its output of iron ore.

McNally Bharat Engineering Company Ltd ended up by 4.01%. The company has received an order for a 2.0 MTPA Pb-Zinc Beneficiation Plant at Sindesar Khurd Mines, Rajasthan from Hindustan Zinc Ltd (HZL) for a value of Rs 300 Crores including taxes and duties. The contractual period of completion of the order is 18 months.

Jubilant Organosys jumped 1.36% after its subsidiary Jubilant Biosys forged a three-year collaboration with US-based pharmaceutical firm Endo Pharmaceuticals for research in Oncology.