Post Session Commentary - July 21 2009

Indian market snapped its two consecutive session’s gaining streak to close the volatile session on downbeat note on sustained selling pressure seen in key stocks. Positive European markets contributed a bit to the recovery during the trading. However, domestic bourses were unable to recuperate on fears of impact of less rain on the economy. Market turned southward and continued to extend losses on profit booking after previous session’s gains. Meanwhile, most of the Asian stocks ended lower, which led selling pressure in the domestic stocks. BSE Sensex ended below 15,100 level and NSE Nifty closed below 4,500 mark.

Market opened marginally up on positive cues from the US markets. On Monday, the US stocks gained remarkably overnight on the back of better corporate earnings and firm buying sentiments. Moreover, the S&P 500 closed at its best levels of the year on reports of CIT deal to avert bankruptcy and the better than expected economic data. Indian benchmark indices trimmed all gains soon after start and slipped on profit booking after a sharp rally in the previous session. However, market tried to recover on positive European markets before sliding again. Further, weakness continued till end as investors continued to trade carefully to remain on sideline after recent rally. From the sectoral front, IT, Power, Tech, PSU, Bank and Realty stocks contributed to most of the selling pressure. However, Metal and Auto stocks were in limelight as witnessed most of the buying from these baskets. Broader market indices were mixed as BSE Mid Cap index observed selling pressure whereas BSE Small Cap index remained in buyers’ radar.

Among the Sensex pack 21 stocks ended in red territory and 9 in green. The market breadth indicating the overall health of the market remained negative as 1343 stocks closed in red while 1289 stocks closed in green and 86 stocks remained unchanged in BSE.

The BSE Sensex closed lower by 128.52 points or (0.87%) at 15,062.49 and NSE Nifty ended down by 33.15 points or (0.74%) at 4,469.10. BSE Mid Caps closed with losses of 9.88 points at 5,225.21 whereas Small Caps closed with gains of 13.95 points at 5,837.82. The BSE Sensex touched intraday high of 15,234.21 and intraday low of 14,955.88.

Losers from the BSE Sensex pack are TCS Ltd (4.54%), BHEL (2.67%), M&M Ltd (2.59%), ITC Ltd (2.53%), ACC Ltd (2.51%), NTPC Ltd (2.48%), Tata Power (2.35%), Sterlite Industries (2.32%), DLF Ltd (2.07%), ICICI Bank (1.92%), Infosys Tech (1.50%), ONGC Ltd (1.49%), Bharti Airtel (1.35%), RCom (0.87%), Herohonda Motors (0.78%) and SBI (0.74%).

Gainers from the BSE Sensex pack are Tata Steel (5.28%), Maruti Suzuki (2.62%), HUL (1.12%), JP Associates (1.08%), Grasim Industries (0.95%) and L&T Ltd (0.91%).

On the global markets front the Asian markets that opened before the Indian market, ended mostly lower. Shanghai Composite, Hang Seng and Straits Times ended lower by 53.71, 0.64 and 1.82 points at 3,213.21, 19,501.73 and 2,454.33 respectively. Stocks weakened on wariness after a recent rally led by stronger earnings from global companies. However, Nikkei 225 and Seoul Composite gained 256.70 and 10.46 points at 9.652.02 and 1,488.99 respectively.

European markets, which opened after the Indian market, are trading in green. In Frankfurt the DAX index is trading up by 41.14 points at 5,071.29 and in London FTSE 100 is trading higher by 26.26 points at 4,469.88.

The BSE IT index ended lower by (1.74%) or 65.58 points at 3,694.03. Losers are TCS Ltd (4.54%), Patni Computer (3.37%), HCL Tech (2.52%), Moser Bayer (2.52%) and Oracle Fin (1.95%).

The BSE Power index decreased by (1.70%) or 49.07 points to close at 2,829.18. Main losers are Suzlon Energy (3.45%), BHEL (2.67%), NTPC Ltd (2.48%), Tata Power (2.35%), GMR Infra (2.20%) and Torrent Power (2.20%).

The BSE PSU index lost (1.40%) or 115 points at 8,087.39. Gujarat hind Copper (4.85%), Hindustan Copper (4.38%), Gail India (3.57%), Canara Bank (2.86%) and BHEL (2.67%) closed in negative territory.

The BSE Teck ended down by (1.40%) or 39.77 points at 2,801.55. IOL Netcom (4.90%), TCS Ltd (4.54%), Balaji Tele (4.28%), Patni Computer (3.37%) and Tele Eighteen (2.94%) ended in red territory.

The BSE Bank index dropped by (1.39%) or 118.28 points at 8,369.02. Scrips that lost are Indus Ind Bank (4.54%), Oriental Bank (4.38%), Kotak Bank (4.18%), Canara Bank (2.86%) and Bank of Baroda (2.36%).

The BSE Metal stocks gained (1.25%) or 142.37 points to close at 11,512.01. Major gainers are Tata Steel (5.28%), Jindal Steel (5.09%), Jindal Saw (3.77%), Ispat Industries (3.35%) and Steel Authority (1.96%).

Oriental Bank of Commerce ended lower by 4.38%. The bank has posted a net profit of Rs 2574.10 million for the quarter ended June 30, 2009 as compared to Rs 2205.20 million for the quarter ended June 30, 2008. Total Income has increased from Rs 21592.10 million for the quarter ended June 30, 2008 to Rs 27961.00 million for the quarter ended June 30, 2009.

KPIT Cummins Infosystems Ltd weakened 3.76% after net profit fell 34.79% to Rs 16.25 crore in Q1 June 2009 as against Q4 March 2009.

Tata Communications dropped by 1.95%. The company announced the launch of a new 10 Gigabit Ethernet (10 GigE) service to help service providers meet growing market demands for high-speed, secure and cost-effective bandwidth.

HDFC Bank closed down by 0.56%. The country’s second largest private sector lender has slashed benchmark prime lending rate (BPLR) by 25 basis points to 15.75% per annum with effect from July 20. The bank had also reduced its fixed deposits rate effective from June 19 by half a percentage point.

State Bank of India (SBI) dropped by 0.74%. The bank has increased the market share as the SBI group increased its share of deposits by 1.5% during FY09 from that in the previous fiscal. At the end of FY08, the banking group’s share of deposits stood at 22.6%, which at present accounts for more than 24% of bank deposits in the country.

National Aluminium Company Ltd (Nalco) gained 0.39%. The Union ministry of environment and forests (MoEF) has approved four environment-oriented projects of the company under Clean Development Mechanism (CDM).

Petron Engineering Construction Ltd closed higher by 4.89%. The company has received an Order from Jaiprakash Associates Ltd for Mechanical Fabrication and Erection for Jaypee Balaji Cement Project, Near Village Budhwada, Dist. Krishna, Andhra Pradesh for a total Contract Value of Rs 4810 Lakhs.

Ranbaxy Laboratories Limited (RLL) ended up by 0.20%. The company has received final approval in Canada to manufacture and market Ran-Simvastatin 5 mg, 10 rng, 20 mg, 40 mg and 80 mg tablets (Simvastatiri) from Health Canada, Therapeutic Products Directorate (TPD).