Market ends choppy trading session lower

Rally in index heavyweight L&T aided an intraday rebound on the domestic bourses triggered by recovery in European stocks and US index futures. Intraday volatility was high. The BSE 30-share Sensex lost 159.04 points or 0.94%, up close to 285 points from the day's low and off close to 126 points from the day's high. The 50-unit S&P CNX Nifty which had fallen below the psychological 5,000 mark, regained that level in the second half of the trading session.

Shares of India's largest engineering and construction firm by sales Larsen & Toubro surged after strong Q4 results and was the top gainer from the Sensex pack. But the broad market depicted weakness. Eight out of 13 sectoral indices were negative. The market breadth was weak even as BSE Mid and Smal-Cap indices fell by a lesser extent than some Sensex stocks.

Intraday volatility was high. The market extended losses after a weak opening triggered by lower Asian stocks. Intermittent recovery was witnessed after a steep intraday slide. The market staged a strong intraday rebound in afternoon trade as European stocks recovered from initial fall. The market weakened again shortly. The market once again recovered from lower level in mid-afternoon trade. The recovery gathered steam in late trade. Stocks weakened again at the fag end of the trading session.

NSE's volatility index India VIX, a gauge of traders' perception of near-term risks in the market based on options prices, rose 2.41% to 27.17. India VIX is calculated based on the S&P CNX Nifty options prices. India VIX is a measure of the market's expectation of volatility over the next 30 calendar days.

Worries over fiscal problems in southern Europe triggered outflow from China and India funds during the week ended 12 May 2010. As a result, Asia funds, excluding Japan, saw only $27 million inflows, their worst week in well over a year, as per data from global fund tracker EPFR Global.

Asian stocks fell on Monday as concerns over the long-term health of the euro zone and weak US earnings dampened investor appetite for risk. The key benchmark indices in China, Hong Kong, Japan, Indonesia, South Korea, Singapore and Taiwan fell by between 0.77% to 5.07%.

US index futures reversed initial sharp losses. Trading in US index futures indicated that the Dow could gain 7 points at the opening bell on Monday, 17 May 2010.

US stocks fell on Friday 14 May 2010 on a combination of weak earnings from retailers, Senate backing for limits on credit card fees and concerns over the sustainability of European public debt. The Dow Jones Industrial Average dropped 162.79 points or 1.51% to end at 10,620.16. The Standard & Poor's 500 Index fell 21.76 points, or 1.88% to 1,135.68. The Nasdaq Composite Index lost 47.51 points, or 1.98% to close at 2,346.85.

Back home, the fourth quarter corporate results announced so far have been fairly encouraging. The combined net profit of a total of 2000 companies rose 24.7% to Rs 54,230 crore on 25.5% rise in sales to Rs 5,42,287 crore in the quarter ended March 2010 over the quarter ended March 2009.

On the macro front, while the headline inflation declined to 9.59% in April 2010 from 9.9% rise in March 2010, the data for February 2010 was revised upwards to 10.06% from provisional figure of 9.89%, the latest government data showed. The RBI has forecast the headline inflation to ease to 5.5% at end-March 2011 on expectations of a normal monsoon.

The latest economic data showed industrial output rose lower than expected 13.5% in March 2010. The growth was also slower than February's 15.1% expansion. Manufacturing sector output rose 14.3% in March 2010. Industrial output rose 10.4% in the 2009/10 fiscal year, faster than the 2.6% growth clocked in the previous fiscal year.

India Meteorological Department (IMD) said on Monday, 17 May 2010, that conditions are favourable for further advance of monsoon over more parts of Bay of Bengal and remaining parts of Andaman during next 48 hours. The southwest monsoon has set over the Andaman and Nicobar islands and some parts of southeast Bay of Bengal.

The Indian Meteorological department (IMD) expects normal rainfall in the June-September monsoon season this year. Rainfall is likely to be 98% of the long-term average, the IMD said on 23 April 2010. Good monsoon rains would help raise farm output, boost rural incomes and lower food inflation. The south west monsoon is important for India as about 60% of the country's farmlands are rain-fed and more than half of the workforce is employed in the agriculture sector. The quantum of rainfall in the crucial sowing month of July and distribution of rainfall during the monsoon season also holds key.

The Reserve Bank of India (RBI) expects India's economy to expand 8% in the year ending March 2011 (FY 2011) with an upward bias, assuming a normal monsoon this year and sustenance of good performance of the industrial and services sectors on the back of rising domestic and external demand. The RBI at its annual policy review on 20 April 2010 said it will continue to monitor macroeconomic conditions, particularly the price situation closely and take further action as warranted.

In its half-yearly World Economic Outlook, the International Monetary Fund (IMF) has pegged India's GDP growth at 8.75% in calendar 2010 and 8.5% in calendar 2011. According to the IMF, domestic demand in India will strengthen as the labour market improves, and investment is expected to be boosted by strong corporate profitability, rising business confidence and favourable financing conditions.

RBI governor D Subbarao on 11 May 2010 said India prefers long-term capital inflows to short-term flows and non-debt flows to debt flows. There is no proposal to impose a Tobin type tax to rein in excessive capital inflows, the RBI governor said. However, it needs reiterating that no policy instrument is clearly off the table and the choice of instruments will be determined by the context, Subbarao added.

The BSE 30-share Sensex fell 159.04 points or 0.94% to 16,835.56. The Sensex fell 443.60 points at the day's low of 16,551 in early afternoon trade. The index fell 32.68 points at the day's high of 16,961.92 in early trade.

The S&P CNX Nifty declined 33.60 points or 0.66% to 5059.90, off the day's low of 4,966.25.

The BSE Mid-Cap index fell 0.21%. The BSE Small-Cap index fell 0.68%. Both the indices outperformed the Sensex.

The market breadth, indicating the overall health of the market, was weak. On BSE, 1746 shares declined as compared to 1056 shares that advanced. A total of 87 shares were unchanged.

BSE clocked turnover of Rs 3969 crore, slightly higher than Rs 3950 crore on Friday, 14 May 2010.

Eight out of 13 sectoral indices were negative. Teck index index (down 1.27%), Auto index (down 1.27%), IT index (down 1.80%), Oil & Gas index (down 1.85%), underperformed the Sensex.

The Capital Goods index (up 2.80%), BSE Healthcare index (up 0.53%), FMCG index (up 0.38%) Power index (up 0.10%), Metal index (down 0.15%), PSU index (down 0.31%), banking sector index Bankex (down 0.50%), BSE Realty index (down 0.93%), outperformed the Sensex. The Consumer Durables index was flat, outperforming the Sensex.

On the Sensex, 24 stocks declined, while others rose.

India's largest thermal power producer by sales NTPC fell 0.95% as net profit declined 4.52% to Rs 2017.65 crore in Q4 March 2010 over Q4 March 2009. The company announced the result during market hours today.

Reliance Infrastructure fell 2.92% as net profit fell 27.46% to Rs 251.09 crore in Q4 March 2010 over Q4 March 2009. The company announced the result on Saturday, 15 May 2010.

Index heavyweight Reliance Industries (RIL) fell 2.57% to Rs 1016.75, with the stock extending losses for the third straight day. Nevertheless, the stock came off day's low of Rs 1010. RIL has agreed with Russia's Sibur to set up a joint venture in India to make butyl rubber amid rising demand from the auto industry. As per the agreement, butyl rubber will be produced at RIL's integrated petrochemical site in Jamnagar.

The RIL stock had surged recently after a favourable ruling in the Supreme Court early this month on gas dispute with Anil Ambani controlled Reliance Natural Resources (RNRL). The Supreme Court ordered the two firms to renegotiate a deal based on government policy on gas utilization.

Earlier, the Bombay High Court, in its order dated 15 June 2009 had directed that RNRL will get assured supply of 28 mmscmd of gas from RIL's Krishna-Godavari basin for 17 years at $2.34 per million British thermal units (mBtu). The gas price was 44.28% lower than the price fixed by the government for gas sale from the RIL block in the KG basin at $4.2 mBtu.

India's largest engineering and construction firm by sales Larsen & Toubro jumped 4.97% to Rs 1605.55 as net profit rose 44% to Rs 1438.10 crore in Q4 March 2010 over Q4 March 2009. The stock came off the day's low of Rs 1475.10. The stock was the top gainer from the Sensex pack. The company announced the result during market hours today.

L&T's order inflow jumped 90% to Rs 23843 crore in Q4 March 2010 over Q4 March 2009. The company's order book as at 31 March 2010 stood at Rs 1,00,239 crore, which is 2.7 times its sales of Rs 36,966 crore for the year ended March 2010, giving strong revenue visibility.

India's largest cellular services provider by sales Bharti Airtel rose 0.79% on bargain hunting after recent sharp fall triggered by telecom regulator Telecom Regulatory Authority of India (Trai)'s recommendation that telecom firms pay a one-time fee for holding radio-spectrum beyond 6.2 mega hertz (MHz) based on 3G prices.

Bharti Airtel said the telecoms regulator's proposals on allocation of second-generation (2G) spectrum are shocking, arbitrary and retrograde and are against all existing global norms for spectrum allocation. The company said it was confident that the Department of Telecommunications (DoT) and that the government will take a rational approach and summarily reject these arbitrary, impractical and perverse recommendations.

But, India's second largest listed cellular services provider by sales Reliance Communications fell 2.01% to Rs 141.60 as consolidated net profit declined 22.99% to Rs 4655 crore in the year ended March 2010 over the year ended March 2009. The stock hit a 52 week low of Rs 140.05 today. Chairman Anil Ambani said RCom will be able to sustain profitable growth in the coming quarters despite a highly competitive environment. The company announced the result on Saturday, 15 May 2010.

Interest rate sensitive banking shares cut steep intraday losses. India's largest private sector bank by net profit ICICI Bank fell 1.03% to Rs 902.40, with the stock falling for the second straight day. Nevertheless, the stock came off the day's low of Rs 883.55. Its ADR fell 4.06% on Friday.

India's biggest commercial bank in terms of branch network State Bank of India (SBI) rose 1.30% to Rs 2251.45. The stock came off the day's low of Rs 2141.75. SBI expects its advances to grow by 22-23% in the current financial year. SBI's net profit declined 31.93% to Rs 1866.60 crore in Q4 March 2010 over Q4 March 2009. The bank announced the result during market hours on Friday, 14 May 2010.

India's second largest private sector bank by net profit HDFC Bank fell 1.24% with the stock falling for the third straight day. Its ADR fell 1.61% on Friday.

India's largest mortgage lender by total income Housing Development Finance Corporation fell 0.86% to Rs 2754.65 with the stock falling for the second straight day. But, the stock came off the day's low of Rs 2719.50. The company's board on 3 May 2010 approved a 5-for-1 stock-split.

HDFC has reportedly extended concessional home loan scheme till 30 June 2010. Under the scheme, HDFC would offer a fixed interest rate of 8.25% up to March 2011, 9% for the next one year and a floating rate thereafter. The scheme was scheduled to end on 30 April 2010.

Auto shares also fell on profit taking. India's top truck maker by sales Tata Motors fell 3.29%, with the stock falling for the second straight day. The company's global vehicles sales rose 53% to 77,732 units in April 2010 over April 2009. Global sales include that of Jaguar and Land Rover brands, which rose 61% to 17,909 vehicles. The figures were announced on 14 May 2010.

India's largest tractor maker by sales Mahindra & Mahindra fell 0.37%, with the stock falling for the second straight day.

India's largest small car maker by sales Maruti Suzuki India declined 1.28%, with the stock falling for the second straight day. As per media reports, Maruti Suzuki has announced the recall of 10,000 units of its compact car A Star (known as Alto in Europe). The recall is only on the automatic transmission version of the vehicle (not sold in India).

Maruti's total sales rose almost 30% to 93,058 units in April 2010 over April 2009. Domestic sales rose 23.4% to 80,034 units. The data was unveiled on 1 May 2010.

Car sales in India rose an annual 39.5% to 143,976 cars in April 2010 over April 2009, data from the Society of Indian Automobile Manufacturers (SIAM) showed. Sales of trucks and buses, a barometer of economic activity, rose 64.5 % to 49,086 units in April 2010 over April 2009, SIAM said.

Bajaj Auto fell 1.04%, with the stock falling for the second straight day. The stock hit a record high of Rs 2219.90 in intraday trade on Friday, 14 May 2010, boosted by strong Q4 results. Net profit surged 306% to Rs 528.65 crore in Q4 March 2010 over Q4 March 2009. The company announced result during market hours on Wednesday, 12 May 2010.

India's largest FMCG maker by sales Hindustan Unilever rose 2.52% on defensive buying.

IT pivotals extended recent losses amid continuing concerns about the potential impact on euro-zone economic growth as governments in the region take measures to bring their swelling fiscal deficits under control. Europe is the second biggest market for Indian IT firms. India's second largest software services exporter Infosys fell 1.55%, with the stock falling for the second straight day. Its ADR fell 2.98% on Friday, 14 May 2010.

India's largest software services exporter TCS fell 2.47%, with the stock falling for the second straight day. India's third largest software services exporter Wipro fell 3.30%, with the stock falling for the third straight day. Its ADR fell 2% on Friday.

Realty stocks fell on profit taking. Housing Development & Infrastructure, Sobha Developers, Peninsula Land, Orbit Corporation, Anant Raj Industries, Ackruti City, Phoenix Mills fell by between 0.24% to 2.41%.

India's largest realty firm by sales DLF declined 3.95%. DLF's net profit surged 1276.45% to Rs 411.01 crore in Q4 March 2010 over Q4 March 2009. The company announced the result after market hours on Friday, 14 May 2010.

GAIL India rose 1.17% as net profit surged 44.57% to Rs 910.82 crore in Q4 March 2010 over Q4 March 2009. The company announced the result during market hours today.

Aban Offshore clocked a highest turnover of Rs 252.72 crore on BSE. Tata Steel (Rs 186.54 crore), State Bank of India (Rs 186.14 crore), Larsen & Toubro (Rs 171.16 crore) and Reliance Industries (Rs 113.15 crore), were the other turnover toppers on BSE.

Cals Refineries reported a highest volume of 3.27 crore shares on BSE. Birla Power (1.27 crore shares), Reliance Natural Resources (74.10 lakh shares), Suzlon Energy (59.30 lakh shares) and Sanra Software (47.84 lakh), were the other volume toppers on BSE.