Post Session Commentary - Oct 9 2009

Extending losses to more than 1%, the domestic market ended below the yesterday’s close tracking fall in European markets. Market extended losses also on fall in US index futures. In addition, investors booked profit in several frontline stocks since morning. IT stocks extended losses after IT bellwether Infosys said strengthening rupee was a big concern for its earnings. Meanwhile, Finance Minister Pranab Mukherjee today said that proposed direct tax law would be implemented in 2011. The new direct tax law is likely to slash the corporate tax rate to 25%, phase out exemptions and make things easier for rules on mergers. BSE Sensex ended below 16,700 level and NSE Nifty closed below 5,000 level.

Market opened higher backed by better than expected Infosys result, higher Asian market and strong trade in the US market overnight. On Thursday, the US stock market closed higher, as jobless claims fell and Alcoa kicked off the earnings season with better-than-expected revenue. Besides, continued weakness in US dollar also motivated the sentiments. However, Indian stocks lost momentum soon after start and turned volatile. Further, market was continual to extend losses and touched the day’s low. Benchmark indices dipped sharply during last trading hours on account of all round selling. From the sectoral front, Auto, Bank, Capital Goods, Power, IT and Metal stocks witnessed most of the selling from these baskets. BSE Midcap and Smallcap stocks also followed the same trend. However, Consumer Durable stocks were able to gain favour from the market.

Among the Sensex pack 26 stocks ended in red territory and 4 in green territory. The market breadth indicating the overall health of the market remained negative as 1792 stocks closed in red while 968 stocks closed in green and 71 stocks remained unchanged in BSE.

The BSE Sensex closed lower by 200.88 points or (1.19%) at 16,642.66 and NSE Nifty ended down by 57.05 points or (1.14%) at 4,945.20. BSE Mid Caps and Small Caps closed with loses 43.53 and 50.93 points at 6,301.38 and 7,371.79 respectively. The BSE Sensex touched intraday high of 16,963.08 and intraday low of 16,606.95.

Losers from the BSE Sensex pack are Tata Motors (6.66%), Sterlite Industries (3.35%), Reliance Infra (2.91%), Grasim Industries (2.55%), M&M Ltd (2.39%), Maruti Suzuki (2.37%), SBI (2.32%), JP Associates (2.32%), ICICI Bank (2.29%), Wipro Ltd (2.17%), BHEL (2.15%), TCS Ltd (1.98%), HDFC (1.54%) and Infosys Tech (1.49%).

Gainers from the BSE Sensex pack are Bharti Airtel (2.54%), ONGC Ltd (1.40%), RCom (1.24%) and HUL (0.09%).

On the global markets front, the Asian markets that opened before the Indian market, ended higher on the back of investor’s optimism about global economy. Shanghai Composite, Hang Seng, Nikkei 225, Singapore''s Straits and Seoul Composite ended higher by 132.29, 6.54, 183.92, 1.56 and 31.33 points at 2,911.72, 21,4999.44, 10,016.39, 2,652.51 and 1,646.79 respectively.

European markets, which opened after the Indian market, are trading in red. In Paris the CAC 40 is lower 4.39 points at 3,802.42, in Frankfurt DAX index is trading down 8.81 points at 5,707.73 and in London FTSE 100 is trading lower by 3.68 points at 5,150.96.

The BSE Auto index ended lower by (1.72%) or 113.15 points at 6,450.01 on profit taking. Main losers are Tata Motors (6.66%), Ashok Leyland (2.77%), Amtek Auto (2.47%), M&M Ltd (2.39%) and Maruti Suzuki (2.37%).

The BSE Bank index decreased by (1.60%) or 158.65 points at 9,771.71. Losers are Federal Bank (3.66%), Punjab National Bank (3.07%), SBI (2.32%), ICICI Bank (2.29%) and Axis Bank (1.62%).

The BSE IT index closed lower by (1.43%) or 62.19 points at 4,276.81. Losers are Patni Computer (4.76%), Rolta Ind (2.93%), Financ Tech (2.81%), Aptech Ltd (2.18%) and Wipro Ltd (2.17%).

The BSE Power index ended down by (1.43%) or 44.78 points at 3,082.39, as ABB Ltd (2.92%), Reliance Infra (2.91%), Lanco Infra (2.61%), Siemens Ltd (2.54%) and GVK Power (2.22%) ended in red.

The BSE Capital Goods index dropped by (1.42%) or 197.56 points at 13,687.81. Losers are Reliance Industrial Infra (3.64%), Bharat Elect (3.02%), ABB Ltd (2.92%), Punj Lloyd (2.55%) and Siemens Ltd (2.54%).

The BSE Consumer Durables index gained (0.35%) or 12.84 points 3,670.87. Gainers are Titan Ind (3.41%) and Blue Star L (1.90%). Losers are Videocon Ind (4.54%), Gitanjali GE (2.05%) and Rajesh Export (0.38%).

Infosys Technologies ended lower by 1.49%. Net profit of the company increased by 7.5% to Rs 1,540 crore for the quarter ended September 2009, on y-o-y basis. Besides, as compared to June 2009 quarter, its revenue grew by 2.1% and net profit went up by under 1%. Infosys posted a net profit after tax of Rs 1,438 crore for the quarter ended September 30, 2009 as compared to Rs 1,390 crore for the quarter ended September 30, 2008. Total Income has increased from Rs 5,143 crore for the quarter ended September 30, 2008 to Rs 5,433 crore for the quarter ended September 30, 2009.

Tata Motors Ltd slipped 6.66% on equity dilution worries after the company said it will raise long-term capital of upto $ 600 million through global depositary receipts and convertible notes issue.

Mastek Ltd shrunk 7.44% after consolidated net profit declined 25.12% to Rs. 26.41 crore in Q1 September 2009 over Q4 June 2009.

MTNL climbed 0.12% on reports the company is keen on acquiring a majority stake in Zambia''s Zamtel and has signed a non-disclosure pact with the company.

Siemens Ltd lost 2.54% after a consortium of the company secured an overseas order worth Rs 403 crore.

SRF Ltd lost 1.12% on reports the company plans to invest about Rs. 1,000 crore on a new factory to make fluorine-based products for export markets.

ICICI Bank decreased by 2.29%. The bank reduced the auto loan rates by 50 basis points and will now cost 10.75% to 11%.

SBI closed lower by 2.32%. The government has agreed for an in-principle approval to State Bank of India (SBI) and State Bank of Indore’s merger, on Thursday a senior finance ministry