Post Session Commentary - July 10 2009

The domestic market today nosedived heavily after paring all earlier gains during final trading hours to close in red terrain. Key stocks slipped sharply after exhibiting sea-saw movement, due to severe selling pressure led by concerns over the economy and poor monsoons. Weak opening of European markets along with depressing US index futures weighed on the sentiments. However, market tried to gather momentum during afternoon trade after the IIP data came in better than expected. India’s industrial production for May grew 2.7% from a revised 1.2% rise in April and a 4.4% recorded in the corresponding month last year. BSE Sensex ended below 13,600 level and NSE Nifty closed round 4,000 mark.

The market opened on pleasant note following mixed cues from the global markets and Infosys results have also contributed to the positive sentiments in the market with better than expected quarterly results. However, US stocks markets closed flat on Thursday after a sharp choppy trade. The financials made a rally after an analyst upgraded Goldman Sachs. However, Indian stocks slipped from the day’s highs and turned a little volatile ahead of IIP data for May. Further, benchmark indices continued to move between positive and negative territory though tried to sustain growth during afternoon on as India''s industrial output for May 2009 rose by faster-than-expected 2.7% from a year earlier. However, during last trading hour market trimmed all gains and descended sharply to end the day in red territory on huge sell-off. From the sectoral front, all indices closed in red barring IT stocks. Besides, most of the selling was witnessed in Oil & Gas, Power Capital Goods, Realty, PSU, Bank and Pharma stocks. BSE Mid Caps and Small Caps stocks also remained out of favour.

Among the Sensex pack 24 stocks ended in red territory and 6 in green. The market breadth indicating the overall health of the market remained negative as 1785 stocks closed in red while 772 stocks closed in green and 81 stocks remained unchanged in BSE.

The BSE Sensex closed lower by 253.24 points or (1.84%) at 13,504.22 and NSE Nifty ended down by 77.05 points or (1.89%) at 4,003.90. BSE Mid Caps and Small Caps closed losses of 92.20 and 95.22 points at 4,718.59 and 4,234.50 respectively. The BSE Sensex touched intraday high of 13,897.19 and intraday low of 13,418.39.

Losers from the BSE Sensex pack are Reliance Infra (6.50%), JP Associates (5.62%), RCom (5.43%), HDFC (4.66%), Sun Pharma (4.16%), Reliance (3.99%)M&M Ltd (3.88%), Hindalco (3.82%), SBI (3.64%) and ACC Ltd (3.51%).

Gainers from the BSE Sensex pack are Wipro Ltd (3.37%), Sterlite Industries (3.32%), Infosys Tech (2.97%), TCS Ltd (1.56%), Maruti Suzuki (0.70%) and HUL (0.23%).

The industrial production for May grew 2.7% from a revised 1.2% rise in April and a 4.4% recorded in the corresponding month last year. The manufacturing sector output in May shot up by 2.5%, while the mining sector and power generation grew 3.7% and 3.3%, respectively. The cumulative growth rate during April-May works out to 1.9%, down from 5.3% during the corresponding period last fiscal.

On the global markets front the Asian markets that opened before the Indian market, ended mostly lower. Shanghai Composite, Hang Seng, Nikkei 225 index and Seoul Composite ended lower by 9.10, 82.17, 3.78 and 2.27 points at 3,113.93, 17,708.42, 9,287.28 and 1,428.62 respectively. However, Straits Times ended marginally up by 0.37 points at 2,307.98.

European markets, which opened after the Indian market, are trading in red. In Frankfurt the DAX index is trading down by 27.99 points at 4,602.08 and in London FTSE 100 is trading lower by 28.70 points at 4,129.96.

The BSE Oil & Gas stocks ended lower by (3.28%) or 289.63 points to close at 8,533.30. Major losers are RNRL (5.27%), BPCL (4.15%), Gail India (4.07%), Reliance Pet (4.02%) and HPCL (3.49%).

The BSE Power index plunged (2.54%) or 67.81 points at 2,603.36. Scrips that lost are Reliance Infra (6.50%), Lanco Infra (4.80%), Reliance Power (4.11%), Suzlon Energy (3.65%) and GVK Power (3.11%).

The BSE Capital Goods index lost (2.27) or 263.98 points to close at 11,291.12. Losers are Praj Industries (8.13%), Areva (6.61%), Alstom Proje (6.17%), Aiaengineer (4.62%) and Reliance Indutrial Infra (4.50%).

The BSE Realty index dropped by (2.10%) or 61.12 points at 2,845.66. Penland Ltd (8.15%), Housing Dev (4.98%), Mahindra Life (4.75%), Orbit Co (4.75%) and Unitech Ltd (3.36%) ended in negative territory.

The BSE PSU ended lower by (2.03%) or 153.25 points at 7,390. Losers are Rashtriya Chem & Fert (8.24%), NMDC Ltd (6.30%), Dredg Corp (5.62%), Indian Bank (4.23%) and BPCL (4.15%).

The BSE IT index increased by (2.17%) or 67.17 points to close at 3,196.09. Main gainers are Wipro Ltd (3.37%), Infosys Tech (2.97%), TCS Ltd (1.56%), HCL Tech (0.74%) and Oracle Fin (0.55%).

Alstom Projects India Limited lost 6.17%. The company has been awarded a contract worth Rs 265 crore by Lanco Infratech Limited to install a new power plant on the Teesta River, in India''s Sikkim region. The electricity output of this new 500 MW plant will be connected to the country''s power grid.

Aurobindo Pharma Limited dropped by 3.62%. The company has received final approval for Fosinopril Sodium and Hydrochlorothiazide Tablets USP I0/I2.5mg and 20/12.5mg from the US Food & Drug Administration (USFDA).

Punj Lloyd decreased by 0.67%. A wholly owned subsidiary of the company and Sembawang Engineers and Constructors (Sembawang) announced its first three breakthrough projects In Libya totaling more than Rs 5,904 crore (US$ 1.2 billion) to build commercial and residential developments.

McNally Bharat Engineering Company ended lower by 1.03%. The company has received 2 orders for Design, Engineering, Manufacturing, Testing, Erection and Commissioning of Ash Handling System for 2X600 MW Mahan and Salaya Essar Power Projects for Rs 69 crores and Rs 24 Crores respectively.

Mahindra Satyam Ltd gained 2.03% after the company signed a five-year multi-million dollar deal with UK-based GlaxoSmithKline to provide SAP and other critical systems support.

Infosys Technologies is closed higher by 2.97%. The company has reported a 17.28% growth in consolidated net profit at Rs 1,527 crore in the first quarter ended June 30, 2009 as compared to Rs 1,302 crore for the quarter ended June 30, 2008. The income stood at Rs 5,472 crore for the Q1 ended June 30, 12.73% up from Rs 4,854 crore in the corresponding period a year-ago. On a quarter-on quarter basis, the company’s net profit declined by 5.33% to Rs 1,527 crore in Q1, from Rs 1,613 crore in the January-March quarter of FY 2009.