Post Session Commentary - July 20 2009

Indian market rose for the second straight session to close with phenomenal gains at the start of new week tracking firm cues from the markets all over the world. Stocks witnessed rally led by growing optimism about recovery in market conditions as encouraging Q1 June 2009 results from India Inc boosted sentiment. In addition, sentiments also helped on news of the rescue of U.S. lender CIT Group. US financer CIT Group received rescue of $3 billion by a group of bondholders and probably escaped bankruptcy. CIT lends to nearly one million small and mid-sized US businesses. Further, higher US index futures, also contributed to the northward journey. However, benchmark indices trimmed gains a bit after early rise though regained strength to exhibit a good show further. BSE Sensex ended above 15,100 level and NSE Nifty closed around 4,500 mark.

Market opened sharply higher on bullish sentiments led by favorable global markets along with better than expected earnings. The US markets closed in flat on Friday that led the Dow to log its fifth straight gain and the Nasdaq its eighth straight advance. However the investors took a breather after digesting some positive earnings numbers from Bank of America, Citigroup and General Electric that led the S&P 500 to close with marginal loss. Further, Indian benchmark pared small portion of gains on profit taking. However, market firmed up again and gained further ground on fresh buying. Finally, strong buying spree over the ground led market to extend gains till the end of session. From the sectoral front, all indices ended in green barring FMCG stocks. Apart from that, most of buying was witnessed in IT, Realty, Tech, Bank, Oil & Gas, Pharma, Metal and Capital Goods stocks. BSE Mid Caps and Small Caps stocks also remained in limelight during the trading.

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 positive as 1837 stocks closed in green while 832 stocks closed in red and 72 stocks remained unchanged in BSE.

The BSE Sensex closed higher by 446.09 points or (3.03%) at 15,191.01 and NSE Nifty ended up by 127.30 points or (2.91%) at 4,502.25. BSE Mid Caps and Small Caps closed with gains of 129.50 and 142.97 points at 5,235.09 and 5,823.87 respectively. The BSE Sensex touched intraday high of 15,209.36 and intraday low of 14,854.17.

Gainers from the BSE Sensex pack are TCS Ltd (15.34%), Wipro Ltd (7.14%), ICICI Bank (7.01%), Infosys Tech (5.66%), DLF Ltd (5.38%), Hindalco (5.35%), Reliance (5.03%), JP Associates (4.82%), ACC Ltd (4.22%), Sterlite Industries (3.80%), Tata Motors (3.78%), SBI (2.78%), L&T Ltd (2.69%) and Bharti Airtel (2.62%).

Losers from the BSE Sensex pack are ITC Ltd (1.98%), Reliance Infra (1.23%), Rcom (1.15%), Tata Steel (0.42%) and HDFC (0.34%).

On the global markets front the Asian markets that opened before the Indian market, ended higher. Hong Kong’s Hang Seng Index advanced strongly to 10-month high, on indications of recovery and better outlook of company’s earnings in US and China. Shanghai Composite, Hang Seng, Straits Times and Seoul Composite ended up by 77.18, 696.71, 24.78 and 38.41 points at 3,266.92, 19,502.37, 2,456.15 and 1,478.51 respectively. Meanwhile, Nikkei 225 was closed for holiday

European markets, which opened after the Indian market, are trading in green. In Frankfurt the DAX index is trading up by 74.50 points at 5,052.90 and in London FTSE 100 is trading higher by 67.57 points at 4,456.32.

The BSE IT closed outperformed the benchmark indices and higher by (7.26%) or 254.33 points at 3,759.61 on better-than-expected results from TCS. Gainers are TCS Ltd (15.34%), Tech Mahindra (9.21%), HCL Tech (8.39%), Wipro Ltd (7.14%) and Mphasis Ltd (6.90%).

The BSE Realty index increased by (4.91%) or 164.25 points to close at 3,511.35. Main gainers are Unitech Ltd (7.80%), Sobha Dev (6.58%), Ackruti (6.26%), Parsvnath (5.71%) and DLF Ltd (5.38%).

The BSE Teck ended up by (4.78%) or 129.61 points at 2,841.32. IOL Netcom (18.66%), Deccan Chr (15.47%), TCS Ltd (15.34%), Tech Mahindra (9.21%) and HCL Tech (8.39%) ended in green territory.

The BSE Bank index advanced by (4.37%) or 355.14 points at 8,487.30 after the Finance Minister said last week that the government is committed to financial sector reforms. Scrips that gained are Allahabad Bank (9.25%), Indus Ind Bank (8.40%), Bank of India (6.48%), Yes Bank (6.41%) and Oriental Bank (6.23%).

The BSE Oil & Gas stocks surged (3.66%) or 336.29 points to close at 9,531.09. Major gainers are Aban Offshore (8.43%), Cairn Ind (6.05%), Reliance (5.03%), Reliance Pet (4.68%) and Essar Oil (2.19%).

The BSE Metal index gained (2.12%) or 336.14 points at 11,369.64. Gujarat NRE C (17%), Sesa Goa Ltd (8.41%), Hindustan Zind (8.13%), Hindalco (5.05%) and Jai corp Ltd (4.99%) ended in positive territory.

The BSE FMCG index dropped by (0.49%) or 12.28 points at 2,847.58. Losers are ITC Ltd (1.98%) and HUL (0.19%).

TCS Ltd spurted 15.34% to Rs. 508.10 after net profit rose 15.27% to Rs 1276.44 crore on 0.12% decline in sales to Rs 5609.60 crore in Q1 June 2009 over Q4 March 2009.

Ranbaxy Laboratories gained 2.61%. The Company has received final approval in Canada to manufacture and market Ran-Amlodipine Tablets, 5 & 10 mg (Amlodipine Besylate Tablets) from Health Canada, Therapeutic Products Directorate (TPD).

HDFC Bank advanced by 2.44%. The bank today slashed the benchmark prime lending rate by 25 basis points to 15.75% per annum with effect from July 20, HDFC Bank said on its website. The cut in lending rate follows the reduction in the fixed deposits rate effective from May 18.

Time Technoplast Ltdd increased by 3.77%. The company announces to set up its manufacturing operations in Tianjin Region in China and has entered into the Agreement with local Chinese Government earlier this week for necessary land for the Project on long lease basis.

Flawless Diamond went up by 5.76%. The company has received two exports Order worth Rs. 320 Million INR for its diamond and branded and non Branded Diamond designer Jewellery.

Nagarjuna Construction Company Ltd gained 4.17%. The company has secured three new orders aggregating Rs. 776 crores.

Alstom Projects India Ltd closed higher by 5.39%. The company has been awarded a contract worth Rs 373 crores by Bharat Heavy Electricals Ltd for supply of Boiler components for 2 X 800 MW Supercritical Coal Fired Power Plant at Krishnapatnam, Nellore Dist in Andra Pradesh.

Infrastructure Development Finance Company Ltd (IDFC) ended up by 1.68%. The company has posted a net profit of Rs 2434.990 mn for the quarter ended June 30, 2009 as compared to Rs 2047.331 mn for the quarter ended June 30, 2008. Total Income has increased from Rs 8115.338 mn for the quarter ended June 30, 2008 to Rs 8778.873 mn for the quarter ended June 30, 2009.