Market jumps on strong FII inflow

The key benchmark indices jumped on the back of heavy buying by foreign funds and on firm global stocks. The market gained in four out of five trading session in the week just gone by as it snapped eight-day winning streak on Friday, 1 April 2011. FII inflow totaled Rs 8548.14 crore in eight trading sessions from 22 March 2011 to 31 March 2011 as per data from the stock exchanges.



The BSE 30-share Sensex gained 604.75 points or 3.21% to 19,420.39 in the week ended 1 April 2011. The S&P CNX Nifty was up 171.80 points or 3.03% to 5,826.05. The BSE Mid-Cap index surged 3.89% and the BSE Small-Cap index vaulted 4.46%. Both these indices outperformed the Sensex.

The key benchmark indices extended gains for the fifth straight session of trade on Monday, 28 March 2011 as inflation worries eased along with a fall in crude oil prices. The BSE 30-share Sensex was up 127.50 points or 0.68% to 18,943.14.

The key benchmark indices logged decent gains on Tuesday, 29 March 2011, extending rally into the sixth day, as inflation worries eased along with a decline in crude oil prices and as data showing stepping up of buying by foreign funds boosted sentiment. The BSE 30-share Sensex jumped 177.60 points or 0.94% to 19,120.80.

The key benchmark indices extended their winning streak for the seventh straight session of trade on Wednesday, 30 March 2011 as world stocks rose. The BSE 30-share Sensex was up 169.38 points or 0.89% to 19,290.18.

The key benchmark indices scored strong gains in highly volatile trade to remain unbeaten for eight straight session of trade and settled at 2-1/2 months highs on Thursday, 31 March 2011. The BSE 30-share Sensex was up 155.04 points or 0.80% to 19,445.22, its highest closing since 12 January 2011.

The key benchmark indices ended a choppy trading session lower on Friday, 1 April 2011 as profit taking emerged after recent strong gains. The BSE 30-share Sensex was down 24.83 points or 0.13% to 19,420.39.

All the stocks from 30 share Sensex pack rose in the week ended Friday, 1 April 2011.

Index heavyweight Reliance Industries (RIL) rose 0.9%. RIL was awarded two blocks in the ninth round of oil and gas block auctions held by the government during the week.

India's largest oil exploration firm ONGC jumped 6.24%. As per recent reports a consortia led by ONGC won 10 blocks in the ninth round of oil and gas block auctions closed on Monday.

India's largest realty firm by market capitalization DLF surged 9.13%, and was the top gainer from the Sensex pack.

Power generation major Reliance Infrastructure jumped 6.72% and was the fourth major gainer from the Sensex pack. After market hours on Tuesday, 29 March 2011, Reliance Infrastructure announced an up to Rs 1000-crore share buy-back offer to buy up to 8.34% shares from public shareholders. The company has set maximum buyback price at Rs 725 a piece. The buyback opens on 5 April 2011 and closes on 13 February 2012.

India's top small car maker by sales Maruti Suzuki India jumped 7.83% and was the second major gainer from the Sensex pack. Total sales rose 28.2% to 1.21 lakh units in March 2011 over March 2010. Total sales rose 24.80% to 12.71 lakh units in the year ended March 2011 (FY 2011) over the year ended March 2010.

India's top truck maker by sales Tata Motors rose 5.17%. The company's total sales rose 11% to 83,363 units in March 2011 over March 2010. Domestic sales rose 9% to 77431 units in March 2011 over March 2010 while exports jumped 45% to 5932 units. Sales of commercial vehicles increased 15% to 49753 units while passenger vehicle sales declined 1.1% to 29,543 units.

India's largest tractor maker by sales Mahindra & Mahindra (M&M) advanced 5.55%. The company;s total sales in the automotive segment rose 18.37% to 37,522 units in March 2011 over March 2010.

India's largest bike maker by sales Hero Honda Motors gained 7.52% and was the third major gainer from the Sensex pack. Hero Honda Motors said Toshiaki Nakagawa, joint managing director and Sumihisa Fukuda, technical director of the company have resigned from the board of directors with effect from 22 March 2011. India's second largest bike maker by sales Bajaj Auto advanced 5.71%.

India's largest software services exporter TCS jumped 5.5%. During market hours on Friday, 1 April 2011, TCS said it will provide end-to-end application development and maintenance services to Air Liquide in the Americas.

India's second largest software services exporter Infosys inched up 1.78%. Given underlying strong demand for offshore outsourcing, IT bellwether Infosys is seen giving a decent to strong guidance on revenue and earnings front for the year ending March 2012 when the software major announces Q4 and year ended March 2011 results on 15 April 2011.

India's top power equipment maker by sales Bharat Heavy Electricals (Bhel) rose 1.16%. During trading hours on Wednesday, 30 March 2011, Bhel said it has secured a contract worth Rs 5450 crore from Lalitpur Power Generation Company, a Bajaj Group, for setting up a super critical power project.

India's largest engineering and construction firm by sales Larsen & Toubro (L&T) gained 3.29%. L&T Finance Holdings, a subsidiary L&T, plans an initial public offering (IPO) of equity shares for an amount aggregating to Rs 1750 crore and has filed a draft red herring prospectus (DRHP) with Securities & Exchange Board of India.

India's largest power utility firm by capacity NTPC rose 3.85%. After market hours on Tuesday, 29 March 2011, NTPC said that the unit number 3 of 500 megawatt of Simhadri Super Thermal Power Project has been successfully synchronised with grid on 29 March 2011 on coal firing.

HDFC (up 6.56%), Jaiprakash associates (up 5.48%), Hindustan Unilever (up 4.82%), Bharti Airtel (up 4.79%), Reliance Communications (up 4.54%), Cipla (up 4.26%) and ICICI Bank (up 1.09%) were among the other gainers.

India's merchandise exports rose 49.7% to $23.5 billion in February 2011 from February 2010, according to provisional data issued Friday by the Ministry of Commerce. The government didn't give any reasons for the growth in exports. Imports rose 21.2% to $31.7 billion, largely due to a rise in non-oil imports, which were up 31% from a year earlier to $23.4 billion. Oil imports in February fell 0.3% to $8.21 billion. India's February trade deficit narrowed to $8.1 billion from $10.4 billion a year earlier, the data showed. Oil imports during April to February, the first 11 months of the just-ended fiscal year 2011, rose 12.4% to $88.1 billion, while non-oil imports rose 20.4% to $217.1 billion.

A survey showed on Friday that the strong pace of expansion in India's manufacturing sector steadied in March 2011, helped by sustained new orders and output, while input prices were at their highest in at least six years, signalling further inflationary pressures. The HSBC Markit Purchasing Managers' Index, based on a survey of around 500 companies, was unchanged at 57.9 in March 2011 from February 2011, the highest since November 2010.

Food price index rose 9.50% and the fuel price index climbed 13.13% in the year to 19 March 2011, government data on Thursday showed. In the previous week, annual food and fuel inflation stood at 10.05% and 12.79% respectively. Inflation in the Primary Articles group fell to 12.98% in the week under review from 13.53% in the week ended 12 March 2011, according to the Commerce Ministry statement.

Prime Minister Manmohan Singh said on Thursday the government will deal with the challenge of high inflation driven by rising oil, food and commodity prices because of political upheavals and natural disasters in some countries. He stated that the government wanted to manage inflation without disturbing the growth momentum. "I am hopeful of seeing lower levels of inflation in the coming months," he said. The Prime Minister also said the tax and financial sector reforms were on government agenda and the government would raise resources through sale of equity in the public sector firms. The government is expected to raise Rs 40000 crore in the year ending March 2012 through sale of stake in state-run firms.

The government on Thursday eased rules on foreign investments. Foreign companies operating in India won't need prior approval from their existing joint-venture partners to operate separately in same business segments. Reports added that this measure will promote the competitiveness of India as an investment destination and it will be instrumental in attracting higher levels of FDI (foreign direct investment) and technology inflows into the country.

The government also has liberalized the rules to allow conversion of non-cash items like import of capital goods, machinery and pre-operative or pre-incorporation expenses into equity with approval from the government. Earlier only external commercial borrowing, lump-sum fee and royalty were allowed to convert into equity. The government has also permitted foreign direct investments in the development and production of seeds and planting materials, without the clause of doing so under "controlled conditions."