Market slips on caution ahead of RBI's monetary policy review

The key benchmark indices fell in choppy trade as caution prevailed ahead of the quarterly monetary policy review by the central bank on Tuesday, 27 October 2009. Volatility was high as traders rolled positions in the derivatives segment from October 2009 series to November 2009 series ahead of the expiry October 2009 contracts on Thursday, 29 October 2009.

The BSE 30-share Sensex fell 70.31 points or 0.42%, off close to 200 points from the day's high and up close to 35 points from the day's low. The S&P CNX Nifty fell below the psychological 5,000 mark after regaining that level in early afternoon trade. Nifty had fallen below the 5,000 mark last week on weak global stocks. The market breadth was weak.

Index heavyweight Reliance Industries fell amid volatile trade. The stock had tumbled on Friday, 23 October 2009, after its partner Hardy Oil said on Friday a D9 well will be plugged and abandoned. Banking, metal, realty and construction stocks, fell.

As per provisional data, foreign funds today, 26 October 2009, sold shares with a net Rs 2.74 crore. Domestic funds offloaded equities worth a net Rs 171.16 crore.

Intraday volatility on the bourses was high ahead of the expiry of the near term derivatives contracts this week. Firm Asian stocks helped the market briefly hit positive zone in early trade after an initial slide. Volatility continued later. The market moved into positive zone from negative zone in early afternoon trade. The Sensex hit a fresh intraday high in afternoon trade. The market pared gains in mid-afternoon trade, soon after hitting a fresh intraday high. It plunged to a fresh intraday low in late trade.

Emerging market equity funds continue to get large sums of money. As per latest data from global fund tracker EPFR Global, emerging market equity funds took in a total of $4.9 billion in the week ended 21 October 2009, their biggest inflow total since the third week of December 2007. Brazil, China, India and Russia equity funds, all had inflows. Emerging market equity funds have now pulled in over $50 billion in net inflows year-to-date.

The Reserve Bank of India (RBI) on Monday said the economic outlook is a mix of recovery prospects and downside risks, and managing the trade-off between supporting growth and reining in inflation poses a complex policy challenge. It said anchoring inflation expectations in the face of sustained high inflation in essential commodities would be a key challenge and cautioned that weak private consumption and investment demand continued to be a drag on faster recovery.

The RBI said delayed withdrawal of the annual monsoon augured well for winter wheat and oilseeds crops due to high moisture retention in the soil, but this year's deficient summer monsoon could hinder faster recovery.

Analysts say a faster industrial output growth and rising inflationary pressures have strengthened case for an end to the RBI's accommodative monetary stance next year. Industrial output grew at its fastest pace in 22 months in August 2009 at 10.4%. Inflation based on the wholesale price index (WPI) rose 1.21% in the year through 10 October 2009, higher than previous week's annual rise of 0.92%, data released by the government on 22 October 2009 showed.

The RBI pumped in massive liquidity in the banking system in the past one year or so to help revive the domestic economy in the aftermath of the global financial crisis. While as exit from the loose monetary policy is imminent, speculation on the bourses is centred around the timing of the exit policy. The RBI is expected to keep its benchmark lending and borrowing rates on hold at a quarterly monetary policy review on Tuesday, 27 October 2009.

A section of market, however, expects the RBI to raise the cash reserve ratio (CRR), the proportion of deposits that banks keep with the central bank, to tame inflationary pressures in the economy. A possibility of a hike in the statutory liquidity ratio (SRL) cannot be ruled out either. In November 2008, the RBI had reduced the SLR by one percentage point to 24% - its first move in 11 years - as part of its measures to boost liquidity to cushion the impact of the global credit crisis after Lehman Brother's collapse. SLR is the minimum share of bank deposits to be held in approved government securities.

Meanwhile, four major trade unions, including those affiliated with the ruling Congress party and those with the opposition communists, have jointly called for the protests on Wednesday, 28 October 2009. Among the demands are a ban on futures trading in commodities and making government aid to industry conditional on not firing workers.

Stock and sector-specific activity may dominate trade on the bourses in the coming days based on expectations on Q2 September 2009 results. Auto firms are seen reporting strong Q2 results on strong volume growth and on lower input costs. Lower interest rates and pay hike for government employees has boosted auto sales this year after last year's slowdown in demand. Government employees have started receiving the balance 60% of their wage arrears as per the recommendations of the VIth Pay Commission.

Cement firms, too, are seen reporting good Q2 numbers on the back of volume growth, higher realisation and decline in costs like imported coal. Metal firms are seen reporting fall in net profit due to a sharp fall in metal prices on year-on-year basis.

Fall in volumes in the commercial property segment and lower realisations in both commercial and residential property segments, will pull earnings of realty firms lower.

Banks are seen reporting a sedate growth in core lending amid sluggish credit offtake. On the flip side, PSU banks will benefit from treasury gains amid volatility in prices of government securities during the quarter.

Strong growth in new subscriber additions will aid topline growth of telecom firms. But falling average revenue per user (ARPU) and revenue per minute due to intense competition will cap bottom line growth.

European shares rose Monday, with autos and chemical firms leading a broad-based advance, although ING shares declined after the firm announced a restructuring. The key benchmark indices in France, Germany and UK were up by between 0.2% to 0.38%.

GfK AG's consumer climate indicator is forecasting a value of 4 points for November 2009, a decline from a revised value of 4.2 points in October 2009, the Nuremberg-based GfK Group said in a statement on Monday

Asian stocks gained on Monday on signs the global economy is recovering. Key benchmark indices in China, Singapore, Japan, South Korea and Taiwan rose by between 0.06% to 1.71%.

South Korea's economy expanded at the fastest pace in seven years. Gross domestic product increased 2.9% in the third quarter from three months earlier, when it grew 2.6%, the central bank said in Seoul today

Japanese Prime Minister Yukio Hatoyama on Sunday said the global economy has likely bottomed out but employment conditions are "dire" and stimulus is needed across Asia to spur domestic demand

Meanwhile, senior Chinese officials on Monday said the government will maintain its fiscal stimulus and loose monetary policy even as they said economic growth is likely to speed up this quarter.

The market has been agog with talks off late that Beijing is thinking about how to start unwinding its ultra-loose pro-growth policies.

Trading in US index futures indicated Dow could rise 13 points at the opening bell on Monday, 26 October 2009.

The earnings-fueled rally fizzled on the Wall Street on Friday, 23 October 2009, as investors began to lock in some profits. The Dow Jones Industrial Average was down 109.13 points, or 1.1%, to 9,972.18. The S&P 500 Index fell 13.31 points, or 1.2%, to 1,079.60. The Nasdaq Composite slipped 10.82 points, or 0.5%, to 2,154.47.

Microsoft's results beat Wall Street expectations. Amazon too reported better-than-expected third quarter profit and stronger sales outlook.

IMF deputy managing director Takatoshi Kato on Monday said it is too early for countries to abandon economic stimulus policies but they should start mapping out exit strategies

Back home, the supply of paper by Indian firms appear limitless, raising concerns that additional share sales will suck liquidity from the secondary equity market. As per reports, Indian firms have garnered about $9 billion (Rs 32,400 crore at the current exchange rates) through sale of shares and convertible bonds to institutional buyers since April 2009. Indian companies are taking advantage of a surge in liquidity to recapitalize and fund capital expenditure after being starved of cash last year.

Most of these companies - from industries ranging from liquor and spirits to infotech - issued equity shares to a select group of investors by way of qualified institutional placement or QIP. If the enabling resolutions passed by the companies are any indication, Indian firms are gearing up to raise $15 billion (Rs 69,427 crore) in the next six months. The list includes Hindalco (Rs 2,900 crore), JSW Steel ($1 billion), India Cements ($100 million), Essar Oil ($2 billion), Tata Steel (Rs 5,000 crore), Jet Airways ($ 400 million) and Bharat Forge ($150 million).

Unlisted Reliance Infratel announced on 22 September 2009 its intention to raise Rs 5,000 crore from the primary market. Divestment of state-run firms by the government may also increase the supply of paper in the market.

The government last week approved stake sales in state-run power producer NTPC and another unlisted power firm Satluj Jal Vidyut Nigam which reflects the country's resolve to speed up reforms and raise more resources for social schemes. On Monday, Trade Minister Anand Sharma said the Union Cabinet had approved a 5% stake sale in NTPC, and 10% in, an unlisted power producer. On Friday, 16 October 2009, Prime Minister Manmohan Singh said many state-run firms are eager to list their shares in the stock market as it would help unlock their value.

The government has approved a follow-on public offering of 20% of state run Steel Authority of India, the steel minister said on Wednesday, 21 October 2009. The Government of India owns nearly 86% of Sail.

The BSE 30-share Sensex fell 70.31 points or 0.42% to 16740.50. The Sensex rose 128.07 points at the day's high of 17,938.88 in mid-afternoon trade. The barometer index fell 104.73 points at the day's low of 16,706.08 in late trade.

The S&P CNX Nifty fell 26.15 points or 0.52% to 4,970.90. Nifty October 2009 futures were near spot price at 4971.50, as compared to the spot closing of 4970.90. Turnover in NSE's futures & options (F&O) segment surged to Rs 85,283.71 crore from Rs 79,719.69 crore on Friday, 23 October 2009.

BSE clocked a turnover of Rs 4678 crore, lower than Rs 5130.45 crore on Friday, 23 October 2009.

The market breadth, indicating the overall health of the market was weak. On BSE, 985 shares advanced as compared with 1740 that declined. A total of 67 shares remained unchanged.

Among the 30-member Sensex pack, 16 fell while rest rose.

With foreign funds making heavy purchases, the Sensex is up 7,093.19 points or 73.52% in calendar year 2009, as on 26 October 2009. From a 3-year closing low of 8,160.40 on 9 March 2009, the Sensex is up 8589.10 points or 105.14%, as on 26 October 2009. FII inflow in the calendar year 2009 totaled Rs 67,740.10 crore (till 23 October 2009).

Coming back to today's trade, the BSE Mid-Cap index fell 1.8% and the BSE Small-Cap index fell 1.31%. Both the indices underperformed the Sensex.

Sectoral indices on BSE displayed mixed trend. The BSE FMCG index (up 0.89%), the BSE Healthcare index (up 0.87%), the BSE IT index (up 0.51%), the BSE Teck index (up 0.27%), the BSE Auto index (down 0.24%), outperformed the Sensex.

The BSE Realty index (down 4.59%), the BSE Consumer Durables index (down 2.38%), the BSE Bankex (down 1.64%), the BSE Oil & Gas index (down 1.51%), the BSE PSU index (down 1.29%), the BSE Metal index (down 1.15%), the BSE Power index (down 1.13%), the BSE Capital Goods index (down 0.98%), underperformed the Sensex.

Energy major Reliance Industries fell 1.56% to Rs 2015.45, extending Friday's 4.04% losses, as partner Hardy Oil said on Friday a D9 well will be plugged and abandoned. Hardy holds a 10% participating interest in the D9 block, which is located in the Krishna Godavari basin on the east coast of India. Reliance Industries is the operator and holds a 90% stake.

The continued pressure on gross refining margins, or the difference between the price of crude and the price of refined petroleum products, is seen weighing on the company's bottom-line in Q2 September 2009, in spite of higher gas production and refining throughput. RIL unveils Q2 results on Thursday, 29 October 2009.

A total of eight brokerages expect a between a 9% fall to a 1.4% rise in RIL's net profit at between Rs 3752.10 crore to Rs 4178 crore in Q2 September 2009 over Q2 September 2008. Their expectations peg a between 23% fall to a rise of 19.8% in revenue at between Rs 34292.90 crore to Rs 53667.70 crore in Q2 September 2009 over Q2 September 2008.

Meanwhile, RIL told the Supreme Court, last week, it had no knowledge of the pact between its chairman Mukesh Ambani and his younger brother Anil. On the third day of hearing on the gas supply dispute between the group firms of the Ambani brothers, Justice R.V. Raveendran asked RIL to satisfy the bench that the MoU, signed in 2005, was not between two companies, but two individuals. The bench also enquired if the pact, which has not been made public till date, could be produced before the court.

Mukesh Ambani-controlled Reliance Industries, India's top conglomerate, is fighting with Reliance Natural Resources, led by younger brother Anil Ambani, over the terms of a deal to sell gas to Reliance Natural at below the price set by the government. Reliance Industries has been presenting initial arguments in the case before the Supreme Court since 20 October 2009, saying the private deal between the Ambani brothers is not binding on the company, and it can sell the gas only at the government-approved price.

The government, which has the power to decide who can buy gas and at what price, had filed an application asserting it is the rightful owner of the disputed gas.

Anil Ambani's Reliance Natural Resources claims the contract is valid and wants the court to direct Reliance Industries to supply it with 28 mmscmd of gas for 17 years at almost half the government-set price of $4.2 per mmBtu.

The Supreme Court will resume hearing the case on Tuesday, 27 October 2009, with Reliance Industries expected to conclude its initial arguments by Thursday, 29 October 2009. The court will then hear arguments by Reliance Natural Resources, following which it will consider a petition by the government to become a party to the dispute.

Oil exploration stocks fell as crude oil prices fell for a third day on Monday after four weeks of gains pushed prices above levels justified by a recovery in demand. Fall in crude oil prices would result in lower realizations from crude sales for oil exploration firms. Crude for December 2009 delivery fell as much as 93 cents, or 1.2%, to $79.57 a barrel in Asian electronic trading.

Cairn India fell 1.77%. UK-based oil and gas exploration major Cairn Energy Plc recently mopped up $240 million by selling 2.3% in its Indian subsidiary Cairn India to Malaysia's Petronas International Corporation.

With this move, Petronas' stake in Cairn India jumps to 14.94%, within touching distance of an open offer trigger. Cairn UK now retains a 62.75% interest in Cairn India, which made a major oil discovery (Mangala) in Rajasthan in the north west of India in 2004. Cairn India, the Indian arm of the UK firm, has interests in a total of 13 acreage blocks in India and Sri Lanka.

India's second biggest state-run oil exploration firm by revenue Oil India fell 0.8%.

India's biggest state-run oil exploration firm by revenue Oil & Natural Gas Corporation (ONGC) fell 0.54%. ONGC has bagged over a third of the 70 blocks offered under the government's eighth New Exploration Licensing Policy (NELP 8), amid luke-warm response towards the bidding round. ONGC bid for 25 blocks and was awarded 11 offshore and two onshore concessions.

Nearly half of 70 blocks offered under NELP 8 found no bidder, with 76 bids submitted for 36 exploration blocks.

PSU OMCs as the sharp rebound in crude oil prices in the past one year will increase under-recoveries on domestic sale of petrol, diesel, kerosene and LPG at controlled prices. HPCL, BPCL, fell by between 0.45% to 3.04%. But, Indian Oil Corporation (IOC) rose 0.16%.

Govinda Rao, a member of the Prime Minister's Economic Advisory Council recently said there is no need to raise fuel prices, if global oil prices remain in the range of $70 to $75 a barrel. Rao said the government expects international crude oil prices to hover around $70 to $75 per barrel. If prices go beyond that consistently, then the numbers will have to change, Rao said.

India's largest drugmaker by sales Ranbaxy Laboratories rose 2.59% after the company reported net profit of Rs 186.08 crore in Q3 September 2009 as against a net loss of Rs 352.93 crore in Q3 September 2008. The result hit the market during trading hours

Ranbaxy Laboratories CEO and Managing Director Atul Sobti said revenue growth in some strategic geographical markets and a sharp focus on cost efficiency, were the underlying themes in the third quarter. With good achievements in these fronts, the company is confident that it is on the path to recovery.

Bank stocks fell after comments from a finance ministry official on Friday, 23 October 2009, dashed hopes for the central bank relaxing mark-to-market rules for bank's debt holdings. The market has been agog with talks of the central bank hiking the ceiling on the portion of government securities that banks can park in held-to-maturity (HTM) category, possibly at the quarterly monetary policy review on 27 October 2009.

India's largest bank by branch network State Bank of India fell 2.05%. State Bank of India (SBI) announced on Saturday that it has concluded the issue of $750 million fixed rate senior notes having a maturity of 5 years at a coupon of 4.50% under the Medium Term Notes (MTN) Programme in the form of Regulation S Global Note. The bonds have been issued through the bank's London branch as of 23 October 2009

India's second largest private sector bank by net profit HDFC Bank fell 0.1% as its ADR fell 1.2% on Friday. The bank's net profit rose 30.2% to Rs 687.46 crore in Q2 September 2009 over Q2 September 2008. The results were more or less in line with market expectations.

India's largest private sector bank by net profit ICICI Bank fell 1.49% as its ADR fell 1.73% on Friday. The bank recently reduced auto loan rates by 50 basis points.

Banks do not have to make any mark-to-market provisions on securities held in the HTM basket if prices of securities fall. Provisions have to be made out of profit and therefore, impact a bank's bottom line. Yields on ten-year government bonds have risen sharply this year. Bond prices and bond yields are inversely related.

Meanwhile, a committee headed by RBI executive director Deepak Mohanty recently suggested discontinuing the usage of a bank's prime lending rate (PLR) as the benchmark for variable rate loans. Instead, it wants banks to arrive at a base rate that reflects the cost of one-year deposits and price loans over this base rate.

The panel has also proposed a ceiling on the extent of loans that can be granted below the benchmark rate. Most banks typically pass on the benefit of falling rates only to fresh customers. RBI governor D Subbarao has repeatedly said though the central bank has slashed its repo rate (at which it lends to banks) by 425 basis points in the last one year, prime lending rates of banks have fallen by only around 200 basis points.

Lenders currently offer loans at less than the benchmark prime lending rate to about 10 categories of borrowers, according to the central bank. Some of these loans are at rates that don't "make much commercial sense" for the banks, according to the report.

Global rating agency Moody's on 21 October 2009 assigned moderate credit risk rating to 13 Indian commercial banks, including the country's largest public sector lender State Bank of India and private entity ICICI Bank. The agency has given the supported ratings an assessment of the government's ability to support the banks to the 13 entities, following the review of systemic support for individual banking systems. Moody's Investor Service in a statement said it has changed the systemic support input for Indian banks' ratings to Baa2 from the A1 local currency deposit ceiling. Baa2 generally refers to moderate credit risk.

The RBI in its report on trend and progress of banking in India for 2008/09 released on Thursday, 22 October 2009, said it needs to assess and initiate measures to raise the capital base of state-run banks. The central bank said off-balance sheet exposures of local banks declined by 26% in 2008/09, but it was necessary to monitor and evaluate risks from such exposure

But, India's largest dedicated housing finance firm HDFC rose 1.69%. HDFC's net profit rose 24.27% to Rs 663.94 crore in Q2 September 2009 over Q2 September 2008. The results beat market expectations.

Realty stocks fell on profit taking. Indiabulls Real Estate, Unitech, Omaxe, fell by between 4.22% to 5.98%.

India's largest realty player by market capitalization DLF fell 5.41% on media reports that the Income Tax Department has sent a showcause notice on 30 September 2009 to scrutinise the books of accounts for assessment year 2007-08 after the special audit for 2006-07 threw open certain issues. The audit for assessment 2006-07 was ordered earlier. The audit recommended reassessment of Rs 1,200 crore as additional income. This could lead to Rs 300-400 crore increased liability for the realty major.

Realty stocks have risen sharply over the past few weeks on reports that demand for residential projects in major cities is picking up on lower home loan rates, property price cuts by developers and a recovery in the job market. The housing market had slumped last year amid a global credit crunch and buyers fearing job losses

Metal stocks also fell on profit taking after recent strong gains. Hindustan Zinc, National Aluminum Company, Hindalco Industries fell by between 1.39% to 3.08%.

India's largest copper maker by sales Sterlite Industries fell 0.75%. The company recently raised $500 million in convertible senior notes and plans to use the proceeds primarily for expansion of its copper business. The notes are convertible into American depositary shares at $23.33 per share.

Steel Authority of India (Sail) fell 0.69%. The steel minister said last week the government has approved a follow-on public offering of 20%. The government holds 85.82% stake in Sail.

But, India's largest steel maker by sales Tata Steel rose 1.79%. Tata Steel and state-run MMTC, last week, signed an agreement to set up a joint venture to acquire, develop, operate mines and process minerals and metals. Tata Steel would hold 74 % stake in the proposed JV, while the remaining 26% will be held by MMTC

Construction stocks fell on profit taking. Hindustan Construction Company, Nagarjuna Construction Company Era Infra Engineering, Gayatri Projects fell by between 0.48% to 4.91%.

Construction shares rose steadily over the past few days on the government's thrust on the infrastructure sector. Higher government spending on infrastructure sector in the Union Budget 2009-2010 to provide a stimulus to the economy, may result in increase order flow for construction.

An expected fall in cement prices in the coming months due to capacity new capacity addition may boost margins for construction firms as cement is a key raw material

India's largest engineering and construction firm by sales Larsen & Toubro rose 0.51% after company announced sale of its shares in Voith Paper Technology India (VPTIL) to its long term joint venture partner Voith GmbH, Heidenheim, Germany. VPTIL is a 50:50 joint venture partner between L&T and Voith GmbH providing design, consultancy and other value added services to Indian paper industry .

L&T's net profit rose 26.1% to Rs 580.4o crore on 3.54% rise in total income to Rs 8136.39 crore in Q2 September 2009 over Q2 September 2008. The result hit the market during trading hours on 22 October 2009.

Jaiprakash Associates fell 3.45% extending recent steep losses. Net profit rose 327.9% to Rs 870.19 crore on 53% rise in sales to Rs 1824.26 crore in Q2 September 2009 over Q2 September 2008. The company announced result after market hours on 21 October 2009. The company also announced 1:2 bonus issue at the time of announcing Q2 results

Reliance Infrastructure fell 2.36%. Anil Ambani-owned Reliance Infrastructure has reportedly again raised the issue of marketing margins being charged by Reliance Industries on sale of gas from the D6 block in Krishna Godavari basin. It has asked the ministry of power to take up the matter in the meeting of empowered group of ministers that is scheduled for Tuesday.

UltraTech Cement rose 1.29% on bargain hunting. The stock fell sharply in the past few days after the company issued a cautious outlook at the time of announcing Q2 results on 16 October 2009. Net profit jumped 53% to Rs 251 crore in Q2 September 2009 over Q2 September 2008.

UltraTech said the performance was affected on a sequential basis due to lower demand in Southern India. The net profit dropped 39.94% to Rs 250.90 crore in Q2 September 2009 over Q1 June 2009.

The company said the cement demand may grow 9% in the year ending March 2010 on the back of government's initiative to boost rural development, infrastructure and housing. It, however, said new capacities which at various stages of implementation will result in pressure on margins.

The company said its focus on higher volume growth, captive power generation and capital productivity will help offset the impact of lower prices on margins.

Among other cement stocks, Grasim Industries, Birla Corporation and ACC rose by between 0.03% to 1.73%.

India's second- largest wireless operator by sales Reliance Communications fell 2.83% after company said it does not have to pay any additional licence or spectrum fee to the government nor had it inflated its revenues. The statement came after the company said it had completed a "preliminary review" of a report issued by a government-appointed auditor which had accused it of various malpractices.

Idea Cellular fell 3.49% even as net profit rose 81.62% to Rs 273.15 crore in Q2 September 2009 over Q2 September 2008. The result hit the market during trading hours

India's largest cigarette maker by sales ITC rose 1.79%, extending Friday's near 5% rise, after net profit rose 25.81% to Rs 1009.91 crore in Q2 September 2009 over Q2 September 2008. The result which hit market during market hours on Friday 23 October 2009, surpassed market expectations.

A surge in profit margins and a decent growth in revenue boosted the bottom line. ITC's operating profit margin surged to 36.59% in Q2 September 2009 from 31.4% in Q2 September 2008

Among other FMCG stocks, Marico, United Spirits, Tata Tea, Britannia Industries, rose by between 0.5% to 2.93%.

REI Agro rose 4.6% after net profit rose 169.77% to Rs 48.91 crore in Q2 September 2009 over Q2 September 2008. The result hit during market during trading hours

IT stocks rose on a weak rupee. India's largest software services exporter TCS rose 0.53%. The company after market hours on 16 October 2009, reported stronger-than-expected Q2 September 2009 results. Consolidated net profit as per US accounting standards rose 6.81% to Rs 1623.90 crore on 3.16% growth in revenue to Rs 7435.10 crore in Q2 September 2009 over Q1 June 2009.

TCS has a good business pipeline and is pursuing 20 to 25 large outsourcing deals, chief executive N. Chandrasekaran said at the time of announcing Q2 results. The management is seeing signs of recovery but it believes it will be slow. The discretionary spent is still tight but there is spent seen in banking, finance services and insurance (BFSI), retail, utility and pharma verticals, TCS said at a conference call after the results. However, a continuous improvement in volumes cannot be expected, it said. The company is seeing stability in demand environment. The management expects to maintain margins at current levels provided there is no adverse rupee movement.

India's third largest software services exporter Wipro rose 0.38%. Its ADR rose 0.27% on Friday. Wipro has bagged a 10-year total outsourcing contract from Delhi International Airport (DIAL) to provide information technology infrastructure and services for the Indira Gandhi International Airport (IGIA).

IT bellwether Infosys Technologies rose 0.6% as its ADR rose 0.89% on Friday. Infosys raised its earnings and revenue guidance in both dollar and rupee terms for the year ending March 2010 (FY 2010) at the time of announcing Q2 September 2009 results before trading hour on 9 October 2009. Infosys, however, said strengthening rupee is a big concern for its earnings.

A foreign brokerage said in a recent note that it expects 2010 IT budgets to be strong given a significant pent-up demand.

The partially convertible rupee was trading at 46.59/60, weaker than Friday's close of 46.50/51 per dollar. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.

ThinkSoft Global settled at Rs 164.30 a premium of 31.44% over its IPO price of Rs 125.

India's largest thermal power producer by sales NTPC rose 1.21% after net profit rose 1.96% to Rs 2151.95 crore in Q2 September 2009 over Q2 September 2008. The results hit the market during trading on Friday 23 Ocotber 2009. The government last week approved a 5% stake sale in NTPC.

Auto stocks rose on expectation of strong Q2 September 2009 result. Hero Honda Motors rose 0.49% even as net profit jumped 95% to Rs 597.14 crore on 26.8% rise in revenue to Rs 4059.44 crore in Q2 September 2009 over Q2 September 2008. The company announced result after market hours on 21 October 2009.

India's largest truck maker by sales Tata Motors rose 1.88% ahead of its Q2 September 2009 result today.

India's largest car maker by sales Maruti Suzuki India was flat after net profit rose 92.5% to Rs 570 crore on 46.6% rise in sales to Rs 7080.67 crore in Q2 September 2009 over Q2 September 2008. The company announced the results on Saturday, 24 October 2009

Maruti said the company remains cautiously optimistic with regard to volume growth in the near future. It said margins in the future may be under pressure due to hardening of commodity prices and strengthening of the Japanese yen. The company said it continues to focus on cost optimization.

But, India's largest tractor maker by sales Mahindra & Mahindra fell 0.61%. Total sales rose 10.94% to 28434 vehicles in September 2009 over September 2008. The company unveiled the sales figures during trading hours on 1 October 2009.

Bajaj Auto fell 0.62%. Bajaj Auto's net profit jumped 117.85% to Rs 402.83 crore in Q2 September 2009 over Q2 September 2008. The company announced the Q2 results during trading hours on 15 October 2009.

Total domestic automobile sales in the country in the first half of the financial year 2009-10 rose by 14.51% year-on-year to 57,82,920 units, according to automobile sales figures released by the Society of Indian Automobile Manufacturers (Siam). The jump in sales for the April-September period came from the double-digit growth posted by the passenger vehicle segment (comprising cars and sports utility vehicles) which grew by 13.46%, by the 15.68% spurt in two-wheeler sales and by an increase of 12.37% in sales of three-wheelers.

Cals Refineries clocked highest volume of 2.82 crore shares on BSE. ThinkSoft Global (1.79 crore shares), Unitech (1.03 crore shares), Ispat Industries (0.69 crore shares) and Punj Lloyd (0.6 crore shares) were the other volume toppers in that order.

ThinkSoft Global clocked highest turnover of Rs 294.50 crore on BSE. Reliance Industries (Rs 157.03 crore), DLF (Rs 137.14 crore), Punj Lloyd (Rs 131.05 crore) and Tata Motors (Rs 124.98 crore) were other turnover toppers in that order.