Post Session Commentary - Aug 12 2009

Indian market closed in negative on sustained selling in keys stocks, though minimized losses during final trading on strong industrial production data. Market sentiment was bearish during the trading due to weak global markets along with concerns over the below normal monsoon and the spread of swine flu. However, market recovered from day’s low during last trading hours in line with rise in European stocks. Moreover, the Index of Industrial Production (IIP) bounced back sharply in the month of June 2009 reporting a growth of 7.8%, higher than 2.7% reported in May. The BSE Sensex ended below 15,050 level and NSE Nifty closed below 4,500 mark.

Market opened on downbeat note tracking weak cues from the global markets. The Asian markets were down and US stocks markets closed lower on Tuesday, due to broad based selling led by banking stocks. Stocks skidded for the second consecutive day as investors awaited the Federal Reserve''s latest decision on monetary policy and guidance on the outlook for recovery from the recession. Further, the investors were closely watching the industrial output that was data due later in the day. The IIP improved sharply in the month of June 2009 reporting a growth of 7.8%. Stocks continued to extend losses till afternoon mainly on concern that lesser than normal rain may weigh down economic recovery. However, market started recovering during final trading hours and minimized losses at the end on positive European markets. From the sectoral front, IT, Metal, PSU, Oil & Gas, Bank and Capital Goods witnessed most of the selling pressure. However, Realty, Pharma and Auto stocks were able to gain favour from the market. The BSE Midcap and Smallcap indices also remained on buyers’ radar.

Among the Sensex pack 18 stocks ended in red territory and 12 in green. The market breadth indicating the overall health of the market remained negative as 1368 stocks closed in red while 1214 stocks closed in green and 99 stocks remained unchanged in BSE.

The BSE Sensex closed lower by 54.43 points at 15,020.16 and NSE Nifty ended down by 13.85 points at 4,457.50. BSE Mid Caps and Small Caps closed with gains of 15.11 and 28.71 points at 5,414.53 and 6,134.93 respectively. The BSE Sensex touched intraday high of 15,043.62 and intraday low of 14,071.05.

Losers from the BSE Sensex pack are Tata Steel (4.20%), TCS Ltd (4.11%), HUL (2.32%), Infosys Tech (1.87%), Hindalco (1.85%), ONGC Ltd (1.82%), Sterlite Industries (1.76%), SBI (1.58%), L&T Ltd (1.57%), Tata Power (1.56%), Reliance Infra (1.10%), ICICI Bank (0.84%), M&M Ltd (0.82%) and Wipro Ltd (0.68%).

Gainers from the BSE Sensex pack are Bharti Airtel (5.84%), Tata Motors (4.41%), DLF Ltd (2.91%), Sun Pharma (2.73%), JP Associates (2.73%), HDFC Bank (1.64%), Herohonda Motors (1.30%), RCom (1.14%), ACC Ltd (1.03%) and ITC Ltd (0.80%).

Beating the forecasts, the Index of Industrial Production (IIP) bounced back sharply in the month of June 2009 reporting a growth of 7.8%, higher than 2.7% reported in May. Cumulative growth for April-June period stands at 3.7% over the corresponding period of the previous year. Moreover, the Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors stand at 183.3, 311.5, and 234.4 respectively as against the corresponding growth rates of 15.4%, 7.3% and 8.0% in June 2008. The cumulative growth during April-June, 2009-10 over the corresponding period of 2008-09 in the three sectors have been 7.3%, 3.2% and 6.0% respectively, which moved the overall growth in the General Index to 3.7%.

On the global markets front the Asian markets that opened before the Indian market, in red. Shanghai Composite, Hang Seng, Nikkei 225, Singapore''s Straits Times Index and Seoul Composite ended lower by 152.00, 638.97, 150.46, 25.99 and 13.86 points at 3,122.72, 20,435.24, 10,435, 2,571.31 and 1,565.35 respectively.

European markets, which opened after the Indian market, are trading in green. In Frankfurt the DAX index is trading higher by 38.19 points at 5,324 and in London FTSE 100 is trading up by 25.42 points at 4,696.76.

The BSE IT index closed lower by (1.78%) or 71.55 points at 3,959.09 on profit taking. Losers are TCS Ltd (4.11%), Infosys Tech (1.87%), Moser Bayer (1.81%), Finance Tech (0.70%) and Wipro Ltd (0.68%).

The BSE Metal index dropped by (1.63%) or 200.57 points at 12,105.09 after LMEX, a gauge of six metals traded on the London Metal Exchange, dropped 1.96% on Tuesday. Scrips that lost are Sesa Goa Ltd (8.73%), Tata Steel (4.20%), Hindustan Zinc (3.23%), JSW Steel (2.17%) and Hindalco (1.85%).

The BSE PSU index lost (0.70%) or 56.75 points at 8,048.33. Main losers are Union Bank (3.47%), Dena Bank (2.63%), Allahabad Bank (2.42%), Indian Overseas Bank (2.41%) and Bank of India (2.23%).

The BSE Oil & Gas index dropped by (063%) or 60.05 points at 9,522.29 oil prices declined overnight on declines in US stock markets. Losers are Cairn Ind (2.91%), ONGC Ltd (1.82%), Essar Oil Ltd (1.30%), Gail India (1.11%) and RNRL (0.45%).

The BSE Realty index gained (2.15%) or 79.57 points at 3,772.59. Gainers are Ansal Infra (6.43%), Housing Dev (5.73%), Pheonix Mill (5.61%), Orbit Co (4.99%) and Sobha Dev (3.54%).

The BSE Pharma index ended up by (1.31%) or 49.99 points at 3,856.25. As Sunpha Adv (5.54%), Ranbaxy Lab (4.49%), Glaxosmith (3.91%), IPCA Lab (3.65%) and Wockhardt Ltd (3.22%) ended in green.

Tata Steel Ltd plunged 4.20% on reports the company has reduced prices of long steel products by up to Rs. 1,500 a tons, with immediate effect.

Tata Communications Ltd fell 2.63% after its American depository receipt slumped 5.48% to $18.99 overnight.

Gujarat NRE Coke Limited dropped by 1.49%. Gujarat NRE Minerals Limited (GNM), an Australian Subsidiary of the company plans of an off market takeover to acquire entire shares of Rey Resources Limited (REY) has received a big boost on its receiving no-objection from the Australian Government under the Foreign Acquisition and Takeovers Act, 1975.

Mphasis Ltd increased slightly by 0.03%. The company announced that it has reached a definitive agreement to acquire AIG Systems Solutions Pvt. Ltd. (AIGSS), part of American International Group Inc.

Sun Pharmaceuticals Industries Ltd gained 2.73%. The company (collectively with its subsidcries/''Sun Phcrma") announced that USFDA has granted approvals for two Abbreviated New Drug Applications (ANDAs), generic version of Eloxatin, oxdidatin for injection and generic version of Imtrex, sumatriptcn sumatriptan tablets.