Market recoups initial losses; Cipla, M&M rally

The market ended the week with minor losses as revival of monsoon rains, robust industrial production data and strong exports data from China, helped stocks bounce back from a sharp fall registered at the onset of the week.

Foreign institutional investor (FII) inflow in June 2010 totaled Rs 1187.70 crore, while FII inflow in the calendar year 2010 totaled Rs 21,756.80 crore (till 9 June 2010).



The food price index rose 16.74% in the year to 29 May 2010, higher than the previous week's annual reading of 16.55% as fruits and potato prices rose, data released by the government showed on 10 June 2010. The fuel price index climbed 14.23% compared with an annual rise of 14.14% in the previous week.

Industrial output rose much faster than expected at 17.6% in April 2010 from a year earlier on strong consumer demand and government spending, data released by the government on Friday, 11 June 2010, showed. March's annual growth rate was revised upwards to 13.9% from 13.5%. Manufacturing output rose 19.4% in April 2010. The industrial output rose 10.4% in the 2009/10 fiscal year (April-March), faster than the 2.6% clocked in the previous fiscal year.

India's monsoon delivered normal rainfall in the past week, the India Meteorological Department (IMD) said on 10 June 2010. Rainfall in the seven days to 9 June 2010 recovered to normal after an initial hiccup when cyclone Phet hindered the advance of the June-September monsoon, which irrigates 60% of farms in India. The IMD in its update on Thursday, 10 June 2010, said Southwest monsoon has advanced into some parts of Konkan & Goa, south Madhya Maharashtra and north interior Karnataka, remaining parts of coastal and south interior Karnataka, some more parts of Rayalaseema and coastal Andhra Pradesh.

The BSE Sensex fell 52.74 points or 0.31% to 17,064.95 in the week ended 11 June 2010. The S&P CNX Nifty fell 16.15 points or 0.31% to 5119.35 in the week.

The BSE Mid-Cap index was almost steady, falling just 0.08% and the BSE Small-Cap index was also steady by sliding just 0.03%. Both the indices outperformed the Sensex.

Trading for the week began on a weak note. The key benchmark indices edged lower on Monday, 7 June 2010, snapping a three-day winning streak, as weak global stocks marred investor sentiment. The BSE 30-share Sensex fell 336.62 points or 1.97% to 16,781.07. The S&P CNX Nifty declined 101.50 points or 1.98% to 5034.

The key benchmark indices declined for the second straight day on Tuesday, 8 June 2010, as European shares faltered. The BSE 30-share Sensex fell 163.97 points or 0.98% to 16,617.10. The 50-unit S&P CNX Nifty fell below the psychological 5,000 level. It lost 46.90 points or 0.93% to 4,987.10.

The key benchmark indices eked out small gains in a choppy trading session on Wednesday, 9 June 2010, as data showing a surge in car sales in May 2010 triggered bargain hunting after a two-day slide. Revival of the monsoon rains supported the domestic bourses. The BSE 30-share Sensex rose 40.79 points or 0.25% to 16,657.89. The S&P CNX Nifty gained 13.20 points or 0.26% to 5,000.30.

A rebound in European stocks aided a rally on the domestic bourses on Thursday, 10 June 2010, which extended gains for the second consecutive session. The BSE 30-share Sensex rose 264.19 points or 1.59% to 16,922.08. The S&P CNX Nifty rose 78.30 points or 1.57% to 5078.60.

The key benchmark indices extended gains for the third straight day on Friday, 11 June 2010, tracking firm world stocks. The BSE Sensex regained the psychological 17,000 mark. Strong industrial production data for April 2010 underpinned sentiment. The BSE 30-share Sensex rose 142.87 points or 0.84% to 17,064.95. The S&P CNX Nifty rose 40.75 points or 0.80% to 5119.35.

BSE Auto index (up 1.57%), Healthcare index (up 1.46%), Capital Goods index (up 0.89%), Oil & Gas index (up 0.22%), Power index (up 0.14%), Bankex index (down 0.24%), outperformed the Sensex.

FMCG index (down 1.53%), PSU index (down 1.37%), index Consumer Durables index (down 1.74%), BSE Teck index (down 1.90%), Metal index (down Realty index (down 4.04%), underperformed the Sensex.

Among 30 Sensex shares, 15 gained and the rest fell last week.

Drug maker Cipla was the top gainer in the Sensex. The stock rose 3.75% to Rs 337.35 in the week.

India's second largest listed telecom operator by sales Reliance Communications (RCom) rose 2.65% on buzz of strategic stake sale. On Sunday, 6 June 2010, RCom's board gave an in-principle approval for induction of strategic/private equity investors into the company through sale of up to 26% stake. Earlier, RCom had said on 2 June 2010 that it had received proposals from international telecom firms to buy a strategic equity stake.

Meanwhile, RCom opted out of bidding for broadband spectrum ahead of the end of the bidding process due to high prices. The company will now focus on wireless broadband through its CDMA network and the 3G spectrum it had won in a recent auction.

India's largest tractor maker by sales Mahindra & Mahindra rose 3.28%. Its total sales increased 69% to 28,486 units in May 2010 over May 2009. Tractor sales rose 28% to 17,256 units.

India's largest car maker by sales Maruti Suzuki India rose 1.91%. The company reported its highest-ever monthly sales in May 2010.

HDFC Bank (up 2.96%), Bharat Heavy Electricals (up 2.62%), ACC (up 2.42%), Housing Development Finance Corporation (HDFC) (up 1.89%), Jindal Steel & Power (up 1.49%), Hero Honda Motor (up 1.14%), Larsen & Toubro (up 0.53%) and Hindustan Unilever (up 0.40%), were the other Sensex gainers.

Index heavyweight Reliance Industries (RIL) rose 1.50%. RIL announced after market hours on Friday, 11 June 2010 that it has entered into an agreement to acquire a majority stake in Infotel Broadband Services which has emerged as the successful bidder in all the 22 circles of the auction for broadband wireless access spectrum conducted by Department of Telecommunications.

RIL will invest about Rs 4800 crore by subscribing to the fresh equity capital to be issued by Infotel. Post investment, RIL will own 95% stake in Infotel, making it a subsidiary of RIL.

RIL also announced during market hours on Friday its sixth oil discovery in exploratory block in the Cambay basin in Gujarat.

Realty major DLF fell the most last week. The stock fell 6.85% to Rs 262.40.

India's largest aluminium maker by sales Hindalco Industries fell 5.65%. According to reports, the company plans to borrow about Rs 14,000 crore in the next couple of years to build two new plants that will treble its aluminium making capacity.

Infosys (down 3.55%), ITC (down 3.39%), Tata Steel (down 2.51%), Sterlite Industries (down 2.10%), Wipro (down 1.28%), NTPC (down 1.17%), Tata Motors (down 0.90%) and ONGC (down 0.84%), edged lower from the Sensex pack.

India's largest private sector bank by market capitalisation ICICI Bank fell 2.43%.

India's largest listed mobile telecom services provider by sales Bharti Airtel fell 0.63%. Bharti Airtel has reportedly won broadband spectrum in four circles. The Bharti Airtel announced the completion of the acquisition of Zain Group's (Zain) mobile operations in 15 countries across Africa for an enterprise valuation of $10.7 billion.