Post Session Commentary - July 9 2009

Final hours selling in selected stocks led the market to close on flat note after reporting gain during the trading session. Indian stocks erased their gains during last trading hours over a possible downgrade of the country''s sovereign evaluation by the rating agencies due to high fiscal deficit. Besides, weak global cues led by fragile data from US market and ease in crude oil prices also weighed on the sentiments. As well, volatility gripped the market on lack of encouraging news from domestic arena. Meanwhile, India’s annual rate of inflation further dropped to minus 1.55 per cent for the week ended 27th June as compared to minus 1.30 per cent of the previous week. BSE Sensex ended below 13,800 level and NSE Nifty closed below 4,100 mark.

The domestic market started the day on flat note and turned choppy soon after start backed by uncertain cues from the global markets. However, the US stocks markets closed flat on Wednesday after a sharp volatile session. The S&P 500 surrendered easily on the back of the auction of $19 billion of 10-year Treasury note which sent the benchmark 10-year bond yield to 3.3% for the first time since May. Indian investors were careful after yesterday’s fall that led market to remain quiet. Further, benchmark indices regained strength in afternoon trade though once again touched the dotted line before once more trimming the losses. To end with, Indian market concluded the today’s instable session flat due to lack of confidence among investors and hesitant global markets. From the sectoral front, Consumer Durable, Capital Goods, IT, Bank and Realty stocks remained out of favour. However, Metal, Pharma and FMCG stocks remained in limelight as witnessed most of the buying from these baskets.

Among the Sensex pack 16 stocks ended in red territory and 14 in green. The market breadth indicating the overall health of the market remained negative as 1462 stocks closed in red while 1078 stocks closed in green and 98 stocks remained unchanged in BSE.

The BSE Sensex closed slightly lower by 11.69 points at 13,757.46 and NSE Nifty ended marginally up by 2.05 points at 4,080.95. BSE Mid Caps closed with gains of 27.95 points at 4,810.79 and Small Caps closed losses of 7.63 points at 5,329.72. The BSE Sensex touched intraday high of 13,879.18 and intraday low of 13,643.97.

Losers from the BSE Sensex pack are Tata Motors (3.15%), ICICI Bank (2.77%), DLF Ltd (2.02%), M&M Ltd (2.02%), Infosys Tech (1.70%), L&T Ltd (1.68%), Hindalco (1.55%), HUL (1.32%), BHEL (1.24%), Grasim Industries (1.09%) and ONGC Ltd (1.01%).

Gainers from the BSE Sensex pack are Reliance Infra (2.45%), Sun Pharma (2.39%), TCS Ltd (2.25%), Sterlite Industries (2.04%), ITC Ltd (1.86%), Tata Power (1.76%), HDFC Bank (1.69%), JP Associates (1.49%) and Reliance (1.26%).

India’s annual rate of inflation further dropped to minus 1.55 per cent for the week ended 27th June as compared to minus 1.30 per cent of the previous week. However, the wholesale price index was 12.03 per cent in the corresponding week a year ago. Inflation eased despite rise in prices of food items like pulses, fish marine and fruit and vegetables.

On the global markets front the Asian markets that opened before the Indian market, ended mixed. Shanghai Composite, Hang Seng and Straits Times ended higher by 42.26, 69.52 and 47.84 points at 3,123.04, 17,790.59 and 2,307.61 respectively. However, Nikkei 225 index and Seoul Composite lost 129.69 and 0.13 points at 9,291.06 and 1,430.89 respectively.

European markets, which opened after the Indian market, are trading in green. In Frankfurt the DAX index is trading up by 65.43 points at 4,638.08 and in London FTSE 100 is trading higher by 29.11 points at 4,169.34.

The BSE Consumer Durable stocks dropped by (1.43%) or 40.99 points to close at 2,816.98. Major losers are Rajesh Export (2.27%), Titan Ind (1.98%), Blue Star L (1.61%), Videocon Ind (1.15%) and Gitanjali GE (0.78%).

The BSE Capital Goods index lost (1.607) or 125.22 points to close at 11,555.10. Losers are Crompton Greaves (3.42%), Reliance Industrial Infra (2.83%), Everrest Kanto (2.77%), Kalpat Power T (2.64%) and Usha Martin (2.49%).

The BSE IT index decreased by (0.63%) or 19.94 points to close at 3,128.22. Main losers are Moser Bayer (3.96%), Oracle Fin (2.14%), Inflosys Tech (1.70%), Financ Tech (1.60%) and Wipro Ltd (0.31%).

The BSE Metal index increased by (1.53%) or 154.68 points at 10,255.84. Welspan Guajrat SR (5.01%), Gujarat NRE C (4.64%), Hindustan Zind (4.53%), Jindal Steel (4.36%) and Steel Authority (3.98%) ended in positive territory.

The BSE Pharma ended higher by (1.70%) or 37.25 points at 3,596.80. Gainers are Wockhardt Ltd (6.42%), Dishmkan Pharma (6.00%), Biocon Ltd (4.36%), Apollo Hos (3.71%) and Aurobindo Pharma (3.63%).

The BSE FMCG index gained (1.02%) or 24.25 points at 2,403.84. Scrips that gained are United Spr (4.86%), Godrej Cons (4.09%), Marico Ltd (3.84%), Godrej Palm (2.39%) and ITC Ltd (1.86%).

Educomp Solutions gained 13.38%. the company said that it has raised Rs 606.69 crore by private placement of shares with qualified institutional buyers. The company has alloted 1,620,000 shares of Rs 10 each at a price of Rs 3,745 a piece, aggregating to an issue size of Rs 606.69 crore on private placement basis with qualified institutional buyers, the company said in a filing to the Bombay Stock Exchange.

Mahindra Satyam Ltd improved 3.62% on reports the company has received an approval from the Company Law Board to issue shares to Venturbay Consultants, a subsidiary of Tech Mahindra, on preferential basis.

SBI ended higher by 0.94%. The bank has approval from the Insurance Regulatory and Development Authority (IRDA) for its proposed non-life joint venture with IAG of Australia.

Moser Baer India Ltd closed lower by 3.96%. The company has posted a net loss of Rs (1508.80) million for the year ended March 31, 2009 as compared to net loss of Rs (789.10) million for the year ended March 31, 2008. Total Income has increased from Rs 20017.30 million for the year ended March 31, 2008 to Rs 23249.10 million for the year ended March 31, 2009.

Mahindra & Mahindra ended down by 1.02%. The company is planning to launch diesel-powered pick-up trucks in the US. However, some global carmakers such as Honda, Toyota, Nissan and Ford have put on hold the similar launches in the US.

DLF Ltd lost 2.02%. The company has sold its stake in a 50:50 joint venture with Ackruti City for developing a commercial project in Mumbai to a US-based real estate fund for over Rs 200 crore. The stake sale by DLF is a part of the company’s asset sale programme to raise Rs 5,500 crore by the end of this fiscal.