The caterpillar does all the work but the butterfly gets all the publicity.
Butterflies signify the sunny side of life, and everyone deserves a little sunshine. Global cues are supportive, though not spectacular. The key indices should resume their northward march after a day’s pause. Talking of sun, the world is witnessing a rare celestial spectacle today - the longest total solar eclipse this century. There are quite a few superstitions linked to eclipses. Most of these are negative. But, when it comes to markets what matters is sentiment, which thankfully is upbeat.
IT major Wipro has announced its Q1 FY10 results. The consolidated net profit is at Rs1,015.5 crores versus Rs1,010 crores in the previous quarter. Consolidated net sales for the quarter is at Rs6,289.1 crores compared to Rs6,482.1 crores in Q4 FY09. The IT Services revenue stood at US$1,033mn, down 1.3% over the January-March quarter. Wipro sees Q2 IT Services revenues at US$1,035-1,053mn.
Caterpillar has topped Wall Street estimates and has lifted its outlook. Others like Merck & Co., Coke and Apple too have unveiled good numbers. The Fed chairman says the US central bank will be able to thwart inflation when the need arises. Hedge funds have seen a huge increase in investment in Q2. An important barometer of European appetite for risk in the credit markets reached a level not seen since the collapse of Lehman Bros.
Back home, the earnings so far have been encouraging though not sensational. One would have to wait for the earnings of the next 2-3 quarters to have a clear picture of the underlying economic scenario and India Inc's health. Monsoon seems to have improved though some concerns still remain on the overall impact on the kharif output. Meanwhile, the Government says that the total foodgrains production in 2008-09 reached a record 233.88 million tons mark. This is about 3 million tons higher than 230.78 MT reached in 2007-08.
The Government has appointed a Disinvestment Secretary and appears to be working on stake sale plans of a few PSUs, apart from NHPC and Oil India. This should please Dalal Street. More such positive measures and policy announcements will go a long way in assuaging the concerns of investors, both local as well as global ones. Hopefully, UPA II will not disappoint on this score.
In short, the market is poised to move ahead, though the advance will not be without hiccups. So, one should brace for a volatile ride rather than a smoother one. Having said that, the market can always spring surprises, both positive and negative ones. How the global economy shapes up will also play a role in determining the fortunes of the Indian market. Other variables include: fund flows, corporate earnings and Government policies.
Results Today: Aventis Pharma, BHEL, Canara Bank, Finolex Cables, GTL, Hind. Zinc, HDFC, IFCI, India Cement, Mastek, NDTV, Piramal Healthcare, Tech Mahindra, Wipro and WWIL.
FIIs were net sellers of Rs2.51bn in the cash segment on Tuesday on a provisional basis while the local funds pulled out Rs74.4mn, according to figures published on the NSE web site. In the F&O segment, the foreign funds were net sellers at Rs5.14bn.
On Monday, the foreign funds were net buyers in the cash segment at Rs7.06bn, as per SEBI data. Their net investment in Indian stocks this year has crossed Rs300bn ($6.3bn). Mutual Funds were net buyers of Rs4.7bn in the cash segment on Monday.
Bulls did IT again as the Indian markets started off the week with a bang. The NSE Nifty index ended above the 4,500 levels for the first time since June 16, 2009 led by the technology stocks; even the BSE Sensex shut shop above the 15,000 levels with the index adding up over 900 points in last two trading session.
IT stocks were the flavor of the day as the BSE IT index ended with biggest daily percentage gains since May 18, 2009. The index surged over 7%. TCS led from the front after posting impressive Q1 results. Stocks like Infosys, Wipro and Tech Mahindra were among the other major gainers.
The Realty and Telecom stocks also ended with smart gains. Even the Mid-Cap and the Small-Cap stocks participated in the rally.
The Sensex surged by 446 points or 3% to end at 15,191 after touching a high of 15,209 and a low of 14,854. The index had opened at 14,854 against the previous close of 14,745.
The NSE Nifty shot up by 127 points or 2.9% to shut shop at 4,502.
Asian markets ended in the positive terrain. The Nikkei in Japan was closed, Australia's S&P/ASX ended higher by 1.2% at 4,050. The Hang Seng index rose by 3.7% to 19,502.
In Europe, stocks were trading in the green. The FTSE in the UK was up 1.4% at 4,450. The DAX rose 1.5% at 5,053 and the CAC 40 gained 1.6% at 3,270.
Coming back to India, among the BSE sectoral indices, the BSE IT index was the top gainer, surging by an impressive 7.2%, followed by the BSE Realty index that was up 5.2%. The BSE Teck index rose 4.6% and BSE Bankex index was up 4.3%.
The BSE Mid-Cap index advanced 2.5% and the BSE Small-Cap index rose 2.5%.
Within the Sensex, the major gainers were TCS, Wipro, ICICI Bank, DLF, Infosys, Hindalco, Reliance Industries and JP Associates. Among the major losers were, ITC, RCom, HDFC, Reliance Infra and HUL.
Outside the frontline indices, the top gainers included Gujarat NRE, IFCI, Aban Offshore, BEL, Koutans Retail and Marico.
Among the big losers in the broader market were Petronet LNG, NMDC, Crompton Greaves, Fortis Health, Sun TV and Exide Ind.
Shares of TCS shot up by over 15% to end at Rs500 on Monday registering its biggest single day gains for the first time since the stock was listed on the exchanges in August 2004. During the intra-day trades market capitalization of TCS hit the 1 lakh crore mark.
The stock rallied after the company posted spectacular Q1 earnings beating market estimates with major brokerage firms upgrading the stock rating.
The stock had opened at Rs449 and made an intra-day high of Rs514 and a low of Rs449. Total traded volumes stood at 3.9mn shares on the BSE.
Shares of Kingfisher Airlines surged by over 8% to Rs50.9 after reports stated tha the company plans to consider selling shares via rights issue or follow-on public offer to raise funds, stated reports. The stock opened at Rs47 and made an intra-day high of Rs51.6 and a low of Rs45.7. Total traded volumes stood at 3.2mn shares on BSE.
Shares of Maytas Infra were locked at 5% upper circuit to Rs71.15 after reports stated that the government will consider a strategic sale of Maytas Infra, if the board makes a recommendation. The stock opened at Rs71.15 and made an intra-day high of Rs71.15 and a low of Rs71.15. Total traded volumes stood at 80,000 shares on BSE.
Shares of India Cements surged by over 3.5% to Rs152 after the company’s wholly owned subsidiary, ICL Financial Services Ltd entered into a share purchase agreement with the promoters of Indo Zinc Ltd for purchase of 17,87,700 equity shares of Rs10/- each fully paid up in IZL constituting 39.84% of its paid up equity share capital.
Shares of Petronet LNG slipped sharply after the company’s profit in the first quarter fell 2.8%, missing market estimates. Net income in the three months ended June 30 decreased to Rs1.03bn from Rs1.06bn a year earlier. Net sales in the quarter rose to Rs26.04bn from Rs16.46bn.
The stock fell over 4.5% to end at Rs68.9 after hitting an intra-day high of Rs77 and a low of Rs66. Total traded volumes stood at 2.3mn shares on BSE.
Shares of Financial Technologies surged by over 2.5% to Rs1387. IFCI acquired 5% stake in the present equity share capital of MCX Stock Exchange Ltd from Financial Technologies at Rs35/- per equity share.
Shares of IFCI surged by over 10% to end at Rs50.15. The stock opened at Rs46 and made an intra-day high of Rs50.55 and a low of Rs45.75. Total traded volumes stood at 10.8mn shares on BSE