Post Session Commentary - Oct 8 2009

The domestic market pared its gains and finally closed on flat note due to fresh selling emerged in key stocks during last trading hour. Besides, market slipped into red during first half of trading due to fall in IT stocks backed by strong rupee. However, stocks surged since mid session on announcement of one-for-one bonus share issue by Reliance Industries Ltd. Firm cues from the markets all over world along with higher US index futures also contributed to the upturn. Meanwhile, India''s inflation increased 0.7% in the 12 months to 26th September 2009, which is lower than 0.83% of the previous week. BSE Sensex ended above 16,800 level and NSE Nifty closed around 5,000 level.

The markets opened higher today on the back of positive Asian markets along with announcement of one-for-one bonus share issue by Reliance Industries Ltd. However, the US stock market ended mixed on Wednesday. Investors took a wait-and-watch approach ahead of the start of earnings season, though banks and techs gained. Stocks were trading listlessly during most of the session as the Dollar Index recovered on Wednesday from losses in the past three sessions. However, Indian benchmark indices pared initial gains due to fall in IT stocks on strong rupee. Further, market rebounded from lows and continued to trade higher on optimism about Q2 September 2009 results. Gains in European stocks also supported the domestic market. Meanwhile, market was unable to hold the same momentum and finally closed on flat note. From the sectoral front, most of the buying was seen in Realty, FMCG, Oil & Gas, Auto, Metal and Power stocks. However, Teck and IT stocks contributed to most of the selling pressure.

Among the Sensex pack 22 stocks ended in green territory and 8 in red territory. The market breadth indicating the overall health of the market remained negative as 1512 stocks closed in red while 1246 stocks closed in green and 110 stocks remained unchanged in BSE.

The BSE Sensex closed marginally higher by 36.22 points at 16,843.54 and NSE Nifty ended slightly up by 16.50 points at 5,002.25. BSE Mid Caps and Small Caps closed with gains 49.85 and 16.27 points at 6,344.91 and 7,422.72 respectively. The BSE Sensex touched intraday high of 156,998.52 and intraday low of 16,775.36.

Gainers from the BSE Sensex pack are Tata Motors (5.35%), Reliance Infra (4.89%), Tata Steel (3.56%), JP Asociates (3.20%), HUL (2.72%), ITC Ltd (2.31%), M&M Ltd (2.14%), ONGC Ltd (2.01%), Herohonda Motors (1.75%), Hindalco (1.57%), NTPC Ltd (1.39%), BHEL (1.16%) and DLF Ltd (1.16%).

Losers from the BSE Sensex pack are Bharti Airtel (6.61%), RCom (6.01%), Sun Pharma (3.42%), TCS Ltd (3.36%), Infosys Tech (1.80%), Maruti Suzuki (1.69%), L&T Ltd (1.65%) and Wipro Ltd (1.40%).

India''s wholesale price index increased 0.7% in the 12 months to 26th September 2009, which is lower than 0.83% of the previous week. The annual inflation rate was 12.08% during the corresponding week of previous year. Inflation has remained in the positive territory for the fourth straight week. The wholesale price index for all commodities stood at 243, down 0.1% from a week earlier. The prices of manufactured products dropped by 0.2% on a week-on-week basis and the price of the fuel group was down 0.1%.

On the global markets front, the Asian markets that opened before the Indian market, ended higher, as investors eyed company earnings for clues about the health of the global economy. Hang Seng, Nikkei 225, Singapore''s Straits and Seoul Composite ended higher by 251.31, 32.87, 16.32 and 17.46 points at 21,492.90, 9,832.47, 2,650.95 and 1,615.46 respectively. 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, as investors awaited decisions on interest rates from Europe''s two leading central banks. In Paris the CAC 40 is higher 43.65 points at 3,800.06, in Frankfurt DAX index is trading up 58.75 points at 5,699.50 and in London FTSE 100 is trading higher by 26.83 points at 5,135.73.

The BSE Realty index ended up by (2.09%) or 90.76 points at 4,424.52, as Housing Dev (6.45%), Indiabull Real (2.75%), Unitech Ltd (2.43%), Sobha Dev (1.76%) and Ackruti (1.26%) in green.

The BSE FMCG index gained (2.01%) or 54.24 points 2,756.84. Gainers are United Brew (8.78%), Godrej Cons (3.23%), HUL (2.72%) and Colgate Palm (2.71%).

The BSE Auto index ended higher by (1.66%) or 107.03 points at 6,563.16. Main gainers are Tata Motors (5.35%), Ashok Leyland (4.79%), Exide Indus (4.35%), Cummins Indi (3.84%) and Apollo Tyre (2.96%).

The BSE Oil & Gas index increased by (1.43%) or 145.68 points at 10,306.88. Gainers are Gail India (3.66%), BPCL (2.52%), HPCL (2.16%), Cairn Indi (2.04%) and ONGC Ltd (2.01%).

The BSE Teck index dropped by (2.80%) or 85.29 points at 2,965.22. Losers are Bharti Airtel (6.61%), RCom (6.01%), Tanla (5.39%), TCS Ltd (3.36%) and HCL Tech (3.22%).

The BSE IT index closed lower by (1.876%) or 82.27 points at 4,339. Losers are TCS Ltd (3.36%), HCL Tech (3.22%), Mphasis Ltd (2.73%), Patni Computer (2.58%) and rolta Ind (1.87%).

Reliance Industries Ltd gained 0.96%. The Board of Directors of the Reliance Industries Ltd proposed, subject to shareholders approval, issue of bonus shares in the ratio of one equity share for every one equity share held in the Company. The Board also declared dividend of Rs 13 per share for the financial year 2008-09. This will result in a payment of Rs. 2,219 crore inclusive of taxes of Rs. 322 crore. Both the bonus shares and dividend will accrue to the shareholders of erstwhile Reliance Petroleum Ltd, which has been amalgamated recently with the Company.

IVRCL Infrastructures & Projects Limited (IVRCL) ended lower by 0.68%. The company has bagged orders of Rs.523.31 Crores from UP Jal Nigain for integrated Sewerage works under JNNURM in Allahabad and from Kakade Infrastructure for Five Building towers, Super-specialty hospital and a star hotel in Pune.

Valson Industries Ltd spurted 4.99% after the company said its board will meet on 15 October 2009 to consider bonus issue.

Edserv Softsystems Ltd jumped 4.97% after the company bagged a modular employable skills training deal from the Indian government.

Financial Technologies India Ltd gained 4.19% on bargain hunting after the stock corrected in the preceding sessions.

Ranbaxy Laboratories Ltd gained 1.74% despite the company''s French unit was raided on 6 October 2009, by European Union officials as part of an investigation of generic drug practices.