Strong Q2 GDP data sends stocks surging data

A surprisingly strong GDP growth rate for the quarter ended September 2009 pushed the key benchmark indices to their highest level in 1-1/2 months. However, the market retraced from higher level later on profit taking.

The latest data showed the gross domestic product (GDP) grew by 7.9% in Q2 September 2009, from 7.1% in the previous year, shattering forecasts as stimulus measures boosted demand and manufacturing activity surged. The economy had registered a 6.1% growth in the first quarter.

The bulk of the recovery was led by a 9.2% growth in manufacturing, while mining and construction activities also expanded by 9.5% and 6.5%, respectively. But agriculture continued to me a major drag with a mere 0.9% growth.

India's fiscal deficit during the April to October 2009 period was Rs 2.45 lakh crore ($52.7 billion), or 61% of the full-year target, the government said in a statement on Monday. Tax receipts were Rs 2.14 lakh crore and total expenditure was Rs 5.37 lakh crore for the first seven months of 2009/10 fiscal year.

The BSE 30-share Sensex rose 469.53 points or 2.82% to 17,101.54 in the week ended 4 December 2009. The S&P CNX Nifty rose 167.15 points or 3.38% to 5108.9.

The BSE Mid-Cap index rose 4.57% to 6,600.97 and the BSE Small-cap index soared 6.55% to 7,852.43. Both these indices outperformed the Sensex.

Key benchmark indices surged on Monday, 30 November 2009, ending a two-day losing streak, as the data showed India's economy expanded at a stronger-than-expected 7.9% pace in the second quarter. The BSE 30-share Sensex was up 294.21 points or 1.77% to 16,926.22. The S&P CNX Nifty was up 90.95 points or 1.84% to 5,032.70.

Key benchmark indices surged for the second running day on Tuesday, 1 December 2009, as markets across Europe and Asia rallied after worries about Dubai's finance woes receded. The BSE 30-share Sensex was up 272.05 points or 1.61% to 17,198.27. The S&P CNX Nifty was up 89.30 points or 1.77% to 5122.

Key benchmark indices saw divergent trend in what was a volatile trading session on Wednesday, 2 December 2009. The market retraced from a one-month high as profit booking emerged. The BSE 30-share Sensex was down 28.36 points or 0.16% to 17,169.91. The S&P CNX Nifty was up 1.25 points or 0.02% to 5123.25.

The key benchmark indices retraced from 1-1/2 month highs on Thursday, 3 December 2009, after comments by a top economic adviser and data showing a surge in food price inflation reinforced market expectation of a hike in cash reserve ratio by the central bank to suck out excess liquidity in the banking system. The BSE 30-share Sensex rose 15.77 points or 0.09% to 17,185.68. The S&P CNX Nifty rose 8.45 points or 0.16% to 5131.70.

The key benchmark indices lost ground on Friday, 4 December 2009 as weak US services sector data fueled worries of a weaker-than-expected jobs report in the US, due later in the global session. The BSE 30-share Sensex fell 84.14 points or 0.49% to 17,101.54. The S&P CNX Nifty fell 22.80 points or 0.44% to 5108.90.

India's largest private sector firm by market capitalisation Reliance Industries (RIL) rose 3.83% to Rs 1,091. Reliance Industries said on Friday one of its units signed a deal with Colombian state oil firm Ecopetrol for two deepwater blocks in Colombia. Under the deal, Ecopetrol will take a 20% stake in the Borojo North Block 42 and the Borojo South Block 43, which together cover an area of about 8,000 square kilometres in water depths ranging from 60-1,500 metres. Reliance's unit will hold the rest of the stake in the blocks and will be the operator. The deal is subject to approval from Colombia's upstream regulator.

Meanwhile, lawyers representing Anil Ambani's Reliance Natural Resources (RNRL) and the government reportedly clashed on Thursday in the Supreme Court over an affidavit filed by the oil ministry, which spelt out the state's stance on the right of power utility National Thermal Power Corporation (NTPC).

The government-owned power company is fighting a legal battle with RIL over a disputed contract, under which the Mukesh Ambani-led firm is supposed to supply gas from Krishna-Godavari basin at $2.34 per million British thermal units (mmBtu). RIL says the contract was never concluded, while NTPC says it was. In the affidavit, the Centre had said the price of $2.34 per mmBtu needed its approval though it also said it would protect NTPC's interests.

Auto stocks surged on the back of strong monthly sales figures for November 2009.

India's top tractor marker by sales Mahindra & Mahindra (M&M) rose 2.61%. The company's domestic auto sales soared 105.1% to 21,387 units in November 2009 over November 2008. M&M sold a total of 22,587 vehicles (domestic plus exports) in November 2009 as against 11,515 vehicles sold in November 2008.

India's largest small car maker by sales Maruti Suzuki India rose 1.99%. Maruti Suzuki, reportedly plans to raise production by up to 75% over the next five years in a bid to hold on to its 50% market share. The company's total vehicle sales spurted 66.60% to 87,807 units in November 2009 over November 2008. The announcement was made during trading hours on Tuesday. Domestic sales spurted 60.10% to 76,359 units, while exports surged 128.60% to 11,448 units in November 2009 over November 2008.

India's second largest bike maker by sales Bajaj Auto rose 4.64%. The company's total vehicle sales rose 73% to 2.76 lakh units in November 2009 over November 2008. Motorcycles sales jumped 84% to 2.42 lakh units.

India's top truck maker by sales Tata Motors rose 12.73%. The company's total sales zoomed 65.49% to 54,108 units in November 2009 over November 2008.

Tata Motors' total passenger vehicle sales in the domestic market grew by 44.52% at 20,706 units last month, against 14,327 units in the same month last year, the company said in a statement released after market hours on Tuesday. Exports jumped by 86.64% at 3,994 units, compared with 2,140 units in the same month last year, it added.

India's largest motorcycle maker by sales Hero Honda Motors, however, fell 4.54%. The company's total vehicle sales jumped 32% to 3.81 lakh units in November 2009 over November 2008.

Banking shares rose on upbeat economic data. India's largest private sector bank by net profit ICICI Bank rose 2.36%. India's second largest private sector bank by net profit HDFC Bank rose 2.09%. India's largest bank by net profit and branch network State Bank of India rose 3.80%.

India's largest mortgage lender by total income Housing Development Finance Corporation (HDFC) inched up 0.80%. After market hours on Tuesday, 1 December 2009 the firm announced a dual-rate loan scheme under which a borrower will be charged a fixed rate up to March 2012 and a floating rate thereafter. For a 20-year loan of Rs 30 lakh, a borrower will pay a fixed rate of 8.25% up to March 2012 and then a floating rate that's 500 basis points below the prime lending rate (PLR) - the institution's benchmark rate. Currently, the PLR is 13.75%.