Post Session Commentary - Oct 6 2009

Indian market ended on positive zone after showing high instability during the trading session. Stocks managed to regain strength as sentiments turned upbeat with the positive opening of European markets. Firm trading in US index futures also contributed to the upward journey. However, stocks were in negative terrain during most of the trading backed by heavy selling pressure mainly on telecom stocks on concerns that the lower call charges will reduce earnings. TRAI is contemplating ruling per second billing mandatory, which will impact earnings of companies of the sector. Meanwhile, According to Montek Singh Ahluwalia, deputy chairman of the Planning Commission, it is expected that India''s economy will grow at 6.3% or more in the year to March 2010. BSE Sensex ended above 16,900 level and NSE Nifty closed above 5,000 level.

The market rebounded after previous session’s huge losses and started the day on green territory on firm cues from global markets. On Monday, the US stock market bounced back from previous session’s losses to close higher on the back of a better than expected ISM (Institute for Supply Management) services index for September. A strong advance by the financial sector along with weaker US dollar contributed to mark the stock market its first gain in five sessions. Further, Indian benchmark indices soon turned volatile after start and slipped lower backed by selling pressure at higher level. Despite firm start, investors were careful as telecom companies retreated on concern lower call charges will cut earnings. Market managed to regain strength during final trading hours on positive European markets. From the sectoral front, most of the buying was witnessed in FMCG, Metal, Bank, Capital Goods and Power stocks. However, Teck, IT and Realty stocks remained out of favor as witnessed most of selling from these baskets.

Among the Sensex pack 16 stocks ended in green territory and 14 in red territory. The market breadth indicating the overall health of the market remained negative as 1685 stocks closed in red while 1039 stocks closed in green and 79 stocks remained unchanged in BSE.

The BSE Sensex closed higher by 92.13 points or (0.55%) at 16,958.54 and NSE Nifty ended up 24.20 by points or (0.48%) at 5,027.40. BSE Mid Caps closed with gains of 11.64 points at 6,207.43 and Small Caps closed with losses of 53.51 points at 7,372.49. The BSE Sensex touched intraday high of 16,988.56 and intraday low of 16,622.05.

Gainers from the BSE Sensex pack are Hindalco (6.05%), HUL (5.55%), Reliance Infra (5.17%), ITC Ltd (3.52%), BHEL (3.33%), Sterlite Industries (3.03%), ICICI Bank (3.02%), Tata Steel (2.60%), HDFC Bank (1.62%), L&T Ltd (1.56%), M&M Ltd (1.42%) and SBI (1.26%).

Losers from the BSE Sensex pack are RCom (10.64%), Bharti Airtel (10.22%), ACC Ltd (2.07%), Wipro Ltd (1.61%), Sun Pharma (1.52%) and DLF Ltd (1.38%).

On the global markets front, the Asian markets that opened before the Indian market, ended mostly higher. Hang Seng, Nikkei 225 and Singapore''s Straits ended higher by 382.46, 17.31 and 28.16 points at 20,811.53, 9,691.80 and 2,611.89 respectively. However, and Seoul Composite lost 8.46 points at 1,598.44. Meanwhile, markets in China have been closed since 1 October 2009 for National day and Autumn festival celebrations. Trading will resume on 9 October 2009.

European markets, which opened after the Indian market, are trading in green. In Paris the CAC 40 is higher 49.01 points at 3,724.02, in Frankfurt DAX index is trading up 88.90 points at 5,597.75 and in London FTSE 100 is trading higher by 74.54 points at 5,098.87.

The BSE FMCG index increased by (3.27%) or 86.14 points at 2,716.73 on defensive buying. Gainers are HUL (5.55%), Godrej Cons (5.20%), ITC Ltd (3.52%), Nestle Ltd (2.54%) and Colgate Palm (2.25%).

The BSE Metal index ended higher by (2.23%) or 308.86 points at 14,159.28 after LMEX, a gauge of six metals traded on the London Metal Exchange increased 0.20% on 5th October 2009. Main Gainers are Hindalco (6.05%), JSW Steel (3.91%), Sterlite Industries (3.03%), Sesa Goa Ltd (2.83%) and Tata Steel (2.60%).

The BSE Bank index ended up by (1.88%) or 183.39 points at 9,915.50, as Axis Bank (3.04%), ICICI Bank (3.02%), Bank of Baroda (2.75%), IOB (2.07%) and Kotak Bank (2.06%) ended in green.

The BSE Capital Goods index gained (1.48%) or 202.02 points 13,822.93. gainers are Gammon Indi (8.24%), BHEL (3.33%), Thermax Ltd (2.27%), Jyoti Struct (1.89%) and Punj Lloyd (1.82%).

The BSE Power index closed higher by (1.18%) or 35.69 points at 3,068.97. Gainers are Reliance Infra (5.17%), BHEL (3.33%), GMR Infra (1.37%) and Tata Power (0.79%).

The BSE Teck index dropped by (3.36%) or 108.15 points at 3,111.79. Losers are RCom (10.64%), Bharti Airtel (10.22%), Idea Cell (8.29%), HCL Tech (5.39%) and MTNL (5.09%).

Reliance Communication lost 10.64%. The company said on 5th October 2009, that it will offer a flat rate for all calls on its network at 50 paise a minute. The scheme, which will replace all existing schemes, has raised concerns of a fresh tariff war. Under the new scheme - ''Simply Reliance Plan'' - RCom will charge a single rate of 50 every minute for all local, STD, incoming and outgoing roaming, and SMS''es.

Bharti Airtel ended down by 10.22% on reports the auction of 3G telecom services by the government could be delayed. Besides, concern that lower call charges will cut earnings, also contributed to downturn.

Madras Cements Ltd shrunk 4.32% after a block deal of five lakh shares was executed on BSE at Rs. 120 per share.

3i Infotech Ltd advanced 7.62% after the company said Reliance Mutual Fund has hiked stake in the company.

L&T Ltd closed up by 1.56%. The company has bagged new orders totaling Rs. 1,513 crore during the second quarter of FY10.

Four Soft Ltd remained unchanged at Rs. 23. The company''s overseas unit secured an order for one of its software products.

Suzlon Energy Ltd remained unchanged at Rs. 87.10. The company has informed about the signing of a repeat order for 57 MW with Ayen Enerji of Turkey. The order will be supplied with 27 units of Suzlon S88-2.1 MW turbine, to be installed at the Seferihisar and Mordogan projects in east Turkey.