Sensex, Nifty settle at one-week highs after marginal rise

Key benchmark indices ended marginally higher on Tuesday as index heavyweight Reliance Industries (RIL) inched up in volatile trade. The barometer index BSE Sensex and the 50-unit S&P CNX Nifty attained their highest closing level in more than a week. The Sensex rose 6.92 points or 0.04%, off close to 63 points from the day's high and up about 114 points from the day's low. The market breadth was positive. Investors were cautious ahead of a vote in Italy that will show whether Prime Minister Silvio Berlusconi has enough support to stay in power and implement austerity measures.



Realty and healthcare stocks witnessed selling pressure while consumer durables and oil & gas stocks managed to clock gains in a volatile market. Interest rate sensitive banking stocks recovered after Reserve Bank of India deputy governor Subir Gokarn said at a televised event on Tuesday that bad loans are not threatening the entire banking system in India and that the policy guidance given so far would hold until further notice.

ONGC reversed initial gains despite strong Q2 results. Bank of India fell after poor Q2 numbers. Reliance Anil Dhirubhai Ambani (ADA) group Reliance Power rose after the company said it is on track to achieve an operating power generation capacity of 5,000 megawatts (MW) by 2012. Many other Reliance ADA group shares advanced. Interest rate sensitive realty stocks fell on profit taking after recent rally triggered by the Reserve Bank of India (RBI) recently indicating pause on rate increases. Pharma stocks declined. ABB jumped on strong Q2 results.

The market edged higher in early trade. The market slipped into the red to hit fresh intraday low in morning trade. A bout of volatility as key benchmark indices trimmed losses after hitting fresh intraday lows in mid-morning trade. Key benchmark indices moved in a tight range in afternoon trade. The market regained positive zone in mid-afternoon trade as European shares rose in early trade. The Sensex once again slipped into the red in late trade.

The BSE Sensex rose 6.92 points or 0.04% to settle at 17,569.53, its highest closing level since 31 October 2011. The index rose 69.62 points at the day's high of 17,632.23 in early trade. The index declined 107.39 points at the day's low of 17,455.22 in mid-morning trade, its lowest level since 3 November 2011.

The S&P CNX Nifty rose 5.15 points or 0.10% to settle at 5,289.35, its highest closing level since 31 October 2011. The Nifty hit a low of 5,252 in intraday trade, its lowest level since 3 November 2011. The Nifty hit a high of 5,304.25 in intraday trade.

BSE clocked turnover of Rs 1975 crore, lower than Rs 2387.90 crore on Friday, 4 November 2011.

The market breadth, indicating the overall health of the market, was positive. On BSE, 1,434 shares rose and 1,399 rose. A total of 131 shares were unchanged. The breadth had turned negative from positive, earlier in the day.

From the 30 share Sensex pack, 17 fell and the rest of them rose.

Interest rate sensitive banking stocks recovered after Reserve Bank of India deputy governor Subir Gokarn said at a televised event on Tuesday that bad loans are not threatening the entire banking system in India and that the policy guidance given so far would hold until further notice. The Reserve Bank of India (RBI) had recently indicated pause on rate increases.

India's largest private sector bank by net profit ICICI Bank fell 0.5% to Rs 880.80, off the day's low of Rs 871. ICICI Bank's consolidated net profit rose 43% to Rs 1992 crore in Q2 September 2011 over Q2 September 2010. Standalone profit after tax increased 22% to Rs 1503 crore in Q2 September 2011 over Q2 September 2010. Net interest income increased 14% to Rs 2506 crore in Q2 September 2011 over Q2 September 2010. Fee income increased 7% to Rs 1700 crore in Q2 September 2011 over Q2 September 2010. Provisions decreased 50% to Rs 319 crore in Q2 September 2011 over Q2 September 2010. The result was announced during trading hours on Monday, 31 October 2011.

ICICI Bank's current and savings account (CASA) ratio stood at 42.1% as on 30 September 2011. Net non-performing asset ratio decreased to 0.8% as at 30 September 2011 from 1.37% as at 30 September 2010 and 0.91% as at 30 June 2011.

India's second largest private sector bank by net profit HDFC Bank rose 0.22% to Rs 483.15, reversing initial losses. The bank's net profit rose 31.48% to Rs 1199.35 on 37.4% rise in total income to Rs 7929.38 crore in Q2 September 2011 over Q2 September 2010. The result was announced during market hours on 19 October 2011. India's largest bank by branch network State Bank of India (SBI) gained 1.7% to Rs 1997.55, with the stock gaining for the fourth straight day. The bank announces Q2 results tomorrow, 9 November 2011. The bank said during market hours today that the All India State Bank Officers' Federation (AISBOF) has deferred its earlier call of a two-day country-wide strike on 8 and 9 November 2011.

Axis Bank (up 1.01%), Union Bank of India (up 0.93%) and Bank of Baroda (up 0.55%), rose.

Bank of India fell 3.96% after the state-run bank announced during market hours today that net profit declined 20.37% to Rs 491.11 crore on 34.63% growth in total income to Rs 7728.16 crore in Q2 September 2011 over Q2 September 2010.

Meanwhile, the board of Bank of India has decided to issue upto 4 crore fresh equity shares for face value of Rs 10 each at an appropriate premium through preferential issue to promoter viz. the Government of India or by any other mode as permitted and at an appropriate time.

Infrastructure Development Finance Company (IDFC) fell 2.59% to Rs 125.80. Consolidated net profit jumped 54.93% to Rs 524.27 crore on 40.94% increase in income from operations to Rs 1714.92 crore in Q2 September 2011 over Q2 September 2010. The result was announced after market hours.

India's third largest software services exporter Wipro declined 0.77% UK's largest food producer, Premier Foods, has chosen Wipro Technologies, the global IT, consulting and outsourcing business of Wipro, as a strategic technology partner. As part of the five year strategic relationship, Wipro will be supporting both systems and processes to enhance efficiency of Premier Foods' supply chain. This relationship will enable Premier Foods to realise quantifiable benefits for a known budgetary expenditure with minimal exposure to variable costs.

Wipro said at the time of announcement of Q2 results recently that in the current macro-economic environment, corporations across the globe are looking to maximize the potential of technology deployments and are increasingly relying on business models and technologies to variabilize their IT spends, enabling more differentiating investment for IT based innovation.

Wipro said it is seeing traction with clients on cloud and variabilized business model offerings. State Street Corporation, one of the world's leading providers of financial services to institutional investors, has entered into a multi-year agreement with Wipro to provide application maintenance and support services Wipro will deploy pioneering lean methodologies delivered through its award winning CIGMA platform for this IT transformation engagement.

Index heavyweight Reliance Industries (RIL) rose 0.26% to Rs 881.85. The stock was volatile. The stock hit high of Rs 884.50 and a low of Rs 868.55. RIL recently refuted speculation that it is considering acquiring Valero Energy, Inc. Valero Energy is a Fortune 50 company based in San Antonio, and through its subsidiaries is the world's largest independent petroleum refiner and marketer.

RIL, last month, neither confirmed nor denied media reports of a likely suspension of oil and gas drilling operations. RIL said on 17 October 2011 that it has always communicated any material event to the stock exchanges first before disseminating to the media. Media reports had suggested recently that RIL may suspend oil and gas drilling operations for an unspecified time until an internal valuation of its exploration and production strategy.

India's largest state-run oil & gas exploration firm by sales, ONGC, fell 0.13% to Rs 278, reversing initial gains on fears of higher subsidy burden due to higher global crude oil prices. The company announced after market hours on Friday, 4 November 2011 that net profit rose 60.37% to Rs 8642.23 crore on 24.41% growth in total income to Rs 24058.33 crore in Q2 September 2011 over Q2 September 2010.

Cairn India (up 5.03%) and Oil India (up 0.28%) rose along with crude oil prices. Higher crude oil prices will result in higher realizations from crude sales for oil exploration firms. Oil traded near the highest in three months in New York as signs of shrinking crude supplies in the US countered concern that Europe will struggle to contain its debt crisis.

ABB jumped 4.28% to Rs 708.15 after the company announced during market hours today that net profit rose 92.55% to Rs 22.16 crore on 29.2% rise in total income to Rs 1747.30 crore in Q3 September 2011 over Q3 September 2010.

ABB said orders from the core sectors helped drive order book position for the third consecutive quarter. The company received orders worth Rs 2492.60 crore in the quarter ended September 2011 compared with an order intake of Rs 2032.10 crore in the quarter ended September 2010. The company said it expects to benefit from significant opportunities in large projects that are awaiting procedural clearances.

The company's order backlog stood at Rs 9151.30 crore as of 30 September 2011 as against Rs 9178.10 crore in the same period last year. ABB said it is concerned about rising interest rates and slowing industrial growth.

Among other capital goods shares, Areva T&D (India) (up 2.99%), BEML (up 0.96%), Bharat Electronics (up 0.90%), Usha Martin (up 0.64%), Crompton Greaves (up 0.62%), Suzlon Energy (up 0.54%), Bhel (up 0.36%), Thermax (up 0.32%) and Alstom Projects (up 0.30%), rose.

Punj Lloyd rose 1.90% after the company said it has been able to achieve order inflow of Rs 10286 crore in H1 FY 2012, more than the order inflow of Rs 9978 crore of the last full financial year.

Engineering and construction company major L&T fell 0.09% to Rs 1391.65.

Interest rate sensitive realty stocks fell on profit taking after recent rally triggered by the Reserve Bank of India (RBI) recently indicating pause on rate increases. Purchases of both residential and commercial property are largely driven by finance. Parsvnath Developers (down 4.35%), Prestige Estates (down 4.16%), Indiabulls Real Estate (down 3.55%), DLF (down 1.76%), Sobha Developers (down 1.42%), Oberoi Realty (down 1.38%), HDIL (down 1.09%), Anant Raj Industries (down 0.86%), Phoenix Mills (down 0.59%), D B Realty (down 0.42%) and Godrej Properties (down 0.22%), dropped.

Most healthcare stocks declined. Aurobindo Pharma, GlaxoSmithKline Pharmaceuticals, Sun Pharmaceutical Industries, Dishman Pharmaceuticals & Chemicals, SPARC, Cipla, Ranbaxy Laboratories, Orchid Chemicals & Pharmaceuticals, Biocon, Divis Laboratories, Dr Reddys Laboratories, Bilcare, Lupin and Pfizer fell by 0.30% to 4.01%.

Anil Dhirubhai Ambani Group shares gained. Reliance Power rose 3.52% to Rs 102.80 after the company said it is on track to achieve an operating power generation capacity of 5,000 megawatts (MW) by 2012. The company announced during trading hours today that consolidated net profit rose 0.28% to Rs 235.47 crore on 46.5% rise in total income to Rs 750.69 crore in Q2 September 2011 over Q2 September 2010.

Reliance Infrastructure rose 3.81% to Rs 475.50. After market hours on Tuesday, the company announced that its consolidated net profit inched up 0.4% to Rs 361.63 crore on 48.50% increase in total income to Rs 5855.34 crore in Q2 September 2011 over Q2 September 2010.

Reliance Communications, Reliance Capital, and Reliance MediaWorks gained by between 0.45% to 4.39%.

Sanwaria Agro Oils shot up 19.67% after scheduling a board meeting on 14 November to consider buyback of equity shares.

State Bank of India clocked a highest turnover of Rs 96.44 crore on BSE. Amrutanjan Health Care (Rs 45.33 crore), Tata Motors (Rs 42.57 crore), Infosys (Rs 40.46 crore) and Reliance Industries (Rs 39.53 crore), were the other turnover toppers on BSE in that order.

Cals Refineries reported a highest volume of 1.98 crore shares on BSE. Shree Ashtavinayak Cine Vision (1.05 crore shares), Nu Tek India (85.55 lakh shares), Sanraa Media (61.97 lakh shares) and Resurgere Mines & Minerals India (39.10 lakh shares), were the other volume toppers on BSE in that order.

The current week is a truncated trading week. The stock market remains closed on Thursday, 10 November 2011 on account of Gurunanak Jayanti.

Stock-specific activity may dominate trade in the near-term with the earnings season as its peak. Investors will closely watch the management commentary at the time of announcement of Q2 September 2011 results, which will provide cues on futures earnings outlook.

State Bank of India, Ranbaxy Laboratories, Indian Oil Corporation, GMR Infrastructure, Power Finance Corporation and Bhushan Steel unveil quarterly results tomorrow, 9 November 2011. DLF, Tata Steel, Hindalco, Pantaloon Retail (India), Mahindra Satyam, Rural Electrification Corporation and CEAT unveil quarterly results on Thursday, 10 November 2011.

Jet Airways (India), GE Shipping, Reliance Capital, Housing Development & Infrastructure and Tata Chemicals unveil Q2 results on Friday, 11 November 2011. Coal India, National Aluminium Company and Shipping Corporation of India report Q2 results on Saturday, 12 November 2011. Sun Pharma unveils Q2 results on Sunday, 13 November 2011. Tata Motors, Mahindra & Mahindra, Tata Power, Bhel, Jaiprakash Associates, JSW Steel and India Cements unveil Q2 results on 14 November 2011.

India's October exports rose an annual 10.8% to $19.9 billion, while imports for the month rose 21.7 percent to $39.5 billion, the trade secretary said on Tuesday, citing provisional data. India's trade deficit in October is seen at $19.6 billion, the highest in four years, Rahul Khullar said. At this rate, the trade deficit for the year could breach the $150 billion mark, he added.

India's service sector contracted for a second straight month in October, as new business grew at its weakest pace since May 2009, dragged by sagging global demand and tight monetary policy, a survey showed on Thursday, 3 November 2011. The seasonally adjusted HSBC Markit Business Activity Index, based on a survey of around 400 firms, slumped to 49.1 in October, its lowest reading in two-and-a-half years and below the 50-mark which separates growth from contraction. It was at 49.8 in September.

India's manufacturing activity in October expanded--though modestly--indicating an improvement in business conditions from a month ago as growth in new orders accelerated, a survey showed Tuesday, 1 November 2011. The seasonally adjusted HSBC Purchasing Managers' Index, prepared by Markit, rose to 52 in October from 50.4 in September. A figure above 50 indicates expansion.

The food price index rose 12.21%, its highest in 9 months, and the fuel price index climbed 14.50% in the year to October 22, government data on Thursday, 3 November 2011, showed. In the previous week, annual food and fuel inflation stood at 11.43% and 14.70% respectively. The primary articles price index was up 12.08% compared with an annual rise of 11.75% a week earlier.

India needs to guard against imported inflationary pressure as the euro-zone continues to reel under the debt crisis, Prime Minister Manmohan Singh said on Wednesday, 2 November 2011. "In an increasingly interdependent world, we have to be wary of contagion effects," Mr. Singh said in a statement before his departure to attend a conference of the Group of 20 industrial and developing economies in Cannes, France.

Bad loans are not threatening the entire banking system and the policy guidance given so far would hold until further notice, a deputy governor of the Reserve Bank of India, Subir Gokarn, said at a televised event on Tuesday, 8 November 2011.

RBI announced a 25 basis points hike in its key policy rate viz. the repo rate to 8.5% after half-yearly review of the monetary policy on 25 October 2011. The central bank cut its GDP growth forecast for the current fiscal year through March 2012 to 7.6% from 8% earlier. But it retained its March-end inflation projection of 7%. RBI said the projected inflation trajectory indicates that the inflation rate will begin falling in December 2011 (January 2012 release) and then continue down a steady path to 7% by March 2012. It is expected to moderate further in the first half of 2012-13. This reflects a combination of commodity price movements and the cumulative impact of monetary tightening. Further, moderating inflation rates are likely to impact expectations favourably.

Mr. Sudipto Mundle, a member of the Reserve Bank of India's technical advisory committee on monetary policy, on Thursday, 3 November 2011, said he expects inflation to ease in the January-March quarter as global commodity prices will begin to cool by then, helped by a favorable base. However, it will still overshoot the RBI's March-end projection of 7%, possibly ending the fiscal year at as high as 8%, he added. Mr. Mundle expects the economy to grow 7%-7.5% this fiscal year, below the RBI's 7.6% forecast.

European stocks edged higher on Tuesday, 8 November 2011, following gains on Wall Street overnight, though the worsening political backdrop in Italy may mean any upside will be short-lived. Key benchmark indices in France, Germany and UK rose by between 1.02% to 1.46%.

A vote in Rome today will test Prime Minister Silvio Berlusconi's majority in parliament and determine if he has enough support to stay in power and implement austerity measures. Italian government bond yields rose to their highest since 1997 as political turmoil in Rome threatened to drag the euro zone's third-largest economy deeper into the region's debt crisis.

Meanwhile, France has announced new austerity measures designed to preserve its wobbly AAA credit rating.

The Greek cabinet was due to hold an emergency session on Tuesday and negotiations were reportedly under way on the "100-day coalition" which must win parliamentary approval for a euro zone bailout and save the country from bankruptcy. Prime Minister George Papandreou provoked chaos last week by calling a referendum on the bailout, a vote which would probably have rejected the package due to its demands for austerity. Papandreou backed down, but was forced into agreeing to make way for the unity coalition.

Most Asian shares fell on Tuesday, on euro-zone debt worries. Investors are concerned that surging bond yields could stifle debt-ridden Italy's fund raising ability and throw the euro zone deeper into financial turmoil. Key benchmark indices in China, Japan, South Korea, and Taiwan fell by between 0.24% to 1.22%. Key benchmark indices in Singapore and Indonesia rose by between 0.64% to 0.73%. Hong Kong's Hang Seng was flat.

Trading in US index futures indicated that the Dow could gain 36 points at the opening bell on Tuesday, 8 November 2011. US stocks closed a volatile, lightly traded session slightly higher on Monday, with sentiment continuing to shift with the latest headline from Europe.

A Labor Department report showed the US unemployment rate hit a six-month low in October and job gains in the prior two months were stronger than previously thought, pointing to some improvement in the still-weak labor market. Non-farm payrolls rose a tepid 80,000 in October, below market expectations. But employers added 102,000 more jobs than previously estimated in August and September. And the US unemployment rate slipped to 9%. It had been stuck at 9.1% for three straight months.