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Monday, May 18, 2009
Nifty May 2009 futures at a substantial premium
May 2009 futures of RIL, ICICI Bank, SBI and DLF at premium
Nifty May 2009 futures were at 4370, at a premium of 46.85 points over the spot closing of 4323.15. Trading was halted at 11:55 IST today, 18 May 2009, as the market-wide circuit filters were applied following a thumping victory of the Congress-led United Progressive Alliance (UPA) government in the Lok Sabha elections.
The turnover on NSE's futures & options segment was a meagre Rs 2599.35 crore today. It was less than 5% on Friday (15 May 2009)'s turnover of Rs 52853 crore.
Reliance Industries (RIL) May 2009 futures were at a premium at Rs 2394 compared to the spot closing of Rs 2367.55.
ICICI Bank May 2009 futures were at premium at Rs 725 compared to the spot closing of Rs 707.10.
State Bank of India (SBI) May 2009 futures were at a premium at Rs 1605 compared to the spot closing of Rs 1576.55.
DLF May 2009 futures were at a premium at Rs 330 compared to the spot closing of Rs 322.65.
In the cash market, the S&P CNX Nifty rose 651.50 points or 17.74% at 4323.15.
A clear mandate for the Congress-led United Progressive Alliance (UPA) boosted hopes a strong coalition would be able to push through economic reforms that would boost foreign investment.
Sensex pull Asian Market Out of Gloom
Shanghai, Hang Seng, Taiex follows Sensex Rally while Sydney, Seoul linger in red
Stock market in Asian region staged a turnaround ending the day mixed on Monday, 18 May 2009, after opening mostly lower by taking cues from Wall Street, where the major indices ended lower on Friday on concerns about the economic outlook.
Towards the end of the day, the markets in Australia, New Zealand, South Korea, and Japan ended lower, the markets in China, Hong Kong, Singapore, Indonesia and Taiwan ended in positive territory.
The trigger for the turnaround was found in the markets of India that soared more than 17%, forcing regulators to stop trading for the day as markets cheered the return to power of the ruling Congress party with a clear mandate
Meanwhile, on Wall Street, stocks oscillated between red and green for the entire day but ultimately ended the day with modest losses. The Dow Jones Industrial Average ended lower by 62.68 points at 8,268.64. The Nasdaq Composite Index, ended lower by 9 points at 1,680. S&P 500 ended lower by 10 points at 882. For the week, indices registered good losses at Wall Street. In percentage terms, Dow lost 3.6%, Nasdaq lost 3.4% and S&P 500 lost 5% during the week.
In the commodity market, crude oil rose on speculation that prices fell too far at the end of last week and may rebound as optimism about an economic recovery grows.
Crude oil for June delivery rose as much as 76 cents, or 1.4%, to $57.10 a barrel in electronic trading on the New York Mercantile Exchange. The contract traded at $57 at 10:16 a.m. London time. The June Nymex oil contract expires tomorrow. The more actively traded July contract was at $57.63 a barrel, up 63 cents, at 10:16 a.m. London time.
Prices rose today after dropping 3.9% on 15 May 2009, the biggest decline in almost a month, when a report showed U.S. industrial production fell for a sixth month. Crude also climbed after Nigerian militants attacked pipelines from Chevron Corporation’s Escravos terminal to domestic refineries and power stations.
Brent crude for July settlement rose as much as 82 cents, or 1.5 percent, to $56.80 a barrel on London’s ICE Futures Europe exchange. The contract was at $56.71 a barrel at 10:17 a.m. London time.
Gold traded little changed near a seven-week high in Asia as some investors may have sold the metal to meet margin calls after a drop in global stocks. Immediate-delivery gold was up 75 cents at $932.55 an ounce at 2:02 p.m. in Singapore. The metal rose to $934.20 May 15, the highest since March 27. Gold for June delivery in New York was little changed at $932.60.
In the currency market, the Japanese yen extends recent rally as the week starts on the back of weakness in stocks. Nikkei breached 9000 psychological level briefly but managed to close 226pts down at 9038. Moody's unified Japan's debt ratings to Aa2, with foreign-currency debt ratings lowered from Aaa and local currency assessment raised from Aa3. Moody's said that the rating reflects the risks of Japan's "high level of debt" and the country's fiscal position is "vulnerable to shocks or imbalances".
The Japanese yen strengthen against its most major counterparts on Monday on concern the recession in the world’s biggest economy will be prolonged as General Motors Corp nears bankruptcy and European Central Bank will cut interest rates further to spur a recovery in the European economy. The Japanese currency quoted at 94.63 per greenback.
The Hong Kong dollar was trading at HK$ 7.7516 against the dollar. Actually The Hong Kong dollar is pegged at HK$ 7.8 to the U.S. dollar but can trade between HK$ 7.75 and HK$7.85 to the U.S. dollar.
In Sydney trades, the Australian dollar weakened against its major counterparts after poor economic data from the Euro zone dampened optimism the world economy may be stabilizing, pushing investors back into safe-haven currencies. The Aussie was quoted at 74.80 cents against the greenback on Monday.
In Wellington trades, the New Zealand dollar fell to its lowest level in a week and a half against the greenback as persistent worries about world economic prospects led to rises in the United States and Japanese currencies. The NZ dollar ended the day at US58.60c from US59.30c on Friday.
The South Koran won ended at 1,259.5 won against the dollar, down 2.5 won from Friday's close, as stock market setbacks turned investors away from risky assets.
The Taiwan dollar weakened against the US dollar as it was trading lower at NT$ 32.9870, down by NT$ 0.0.370 from Friday’s close of NT$32.950.
Coming back in equities, a surge in Indian equities following a decisive election victory by the Congress Party-led coalition over the weekend-helped turn around other markets in Asia today.
In India, a clear mandate for the Congress-led United Progressive Alliance (UPA) in Lok Sabha elections send stocks surging with trading on the bourses halted for the day at about 11:55 IST. For the first time in the history of the stock markets trading was halted because the market-wide circuit were applied due to a solid surge. Earlier, there have been instances when trading was halted when market-wide circuit filters were applied due to a market crash.
The 30-share Sensex jumped 2110.79 points or 17.34% at 14,284.21 and the 50-unit S&P CNX Nifty gained 651.50 points or 17.74% to 4,323.15.
Trading was halted in just 16 seconds after the market re-opened at 11:55 IST. Earlier in the day, trading was halted within seconds of opening as the market soared following a clear mandate in the Lok Sabha election. A clear mandate for the Congress-led United Progressive Alliance (UPA) boosted hopes a strong coalition would be able to push through economic reforms that would boost foreign investment. The 30-share Sensex surged 14.70% or 1,789.88 points to 13,963.30 and the 50-unit S&P CNX Nifty gained 531.65 points or 14.48% to 4203.30.
The BSE Sensex attained its highest closing since 11 September 2008 and the S&P CNX Nifty attained its highest closing since 10 September 2008.
In rest of Asia, Japanese stock market finished the session sharply lower, on broad based slumps across the sector. Exporters and automakers dragged down the market as of strengthening yen against greenback and after Panasonic tepid earnings report. The spread of the new flu in Japan dampened investor sentiment further. The Nikkei 225 Stock Average index tumbled 226.33 points, or 2.4%, to 9,038.69, while the broader Topix index dropped 21.94 points, or 2.5% to 860.
In Mainland China, Shanghai stock market recouped early losses to finish the session slightly higher, as investors chased bargains in energy and non ferrous stocks amid speculation prices of the fuel and commodities will rise on higher demand, while Banks ended mixed after banking regulator said lenders face pressure on profits.
The Shanghai Composite Index, which covers both A shares and B shares on the Shanghai Stock Exchange, rose 0.3%, or 7.51 points, to close at 2,652.77, while the Shenzhen Component Index on the smaller Shenzhen Stock Exchange recovered 0.4% or 40.82 points to close at 10,314.04 points.
In Hong Kong, the stock reversed early losses in afternoon trading to finish the session higher, as rebound in energy, finance, and properties stocks on tracking sharp recovery in shanghai bourses in a bout of late-session buying. The Hang Seng Index gained 232.21 points, or 1.38%, to 17,022.91, while the Hang Seng China Enterprise Index, which tracks H shares of Chinese companies, rose 184.95 points, or 1.93% to 9,792.24.
In Australia, the stock market finished the session lower, with broad based losses across the sector on the back of weak lead from Wall Street, collapse of Australia’s largest managed investment scheme Great Southern, a number of capital raisings, and weakness in commodity prices. At the closing bell, the benchmark S&P/ASX200 index has retreated 37.6 points, or 1%, to 3,735.60, while the broader All Ordinaries erased 37.3 points, or 0.99%, to 3,721.60.
In New Zealand, equities dipped down to commence the first trading day of the week in the negative terrain. The share market was in line with most of the Asian markets that fell early today, trailing pessimism on the Wall Street that closed in the red on Friday. The NZX50 dipped down 0.36% or 13.04 points to 2777.86. However, NZX 15 fell 0.81% or 41.71 points to close at 5078.32.
On the economic front, New Zealand’s producers' input prices, as measured in the producer price index (PPI), fell 2.5% and output prices fell 1.4%in the March 2009 quarter, Statistics New Zealand said today. Lower prices for imported crude oil and for fuel made major contributions to the fall in input prices, while lower prices in the dairy product manufacturing index drove down output prices. The 2.5% fall in the inputs index is the largest since the series began in the December 1977 quarter.
The capital goods price index (CGPI) in New Zealand rose 1.2%in the March 2009 quarter, Statistics New Zealand said today. The most significant upward contribution came from the plant, machinery and equipment index. This rise was mainly due to the depreciation of the New Zealand dollar. On an annual basis, the CGPI rose 4.9% in the year to the March 2009 quarter. This rise is the largest annual movement since the series began in the December 1989 quarter, following rises of 2.5%and 3.6%in the years to the March 2008 and the March 2007 quarters, respectively.
In South Korea, shares closed lower Monday as investors unloaded steel, shipyard and financial shares amid lingering concerns over an economic slowdown. The benchmark Korea Composite Stock Price Index (KOSPI) lost 5.05 points or 0.36% to 1,386.68, after falling to as low as 1,366.58 in early trading.
On the economic front, South Korea posted a fresh record-high trade surplus in April as imports declined faster than exports amid a protracted economic slowdown, a report showed Monday. According to the report by the Korea Customs Service, South Korea's trade surplus amounted to US$5.79 billion last month, up from the previous month's $4.28 billion. The April figure is the highest, renewing the all-time record set in March. Exports fell 19.6 percent last month from a year earlier to $30.42 billion, while imports plunged 35.6 percent over the same period to $24.63 billion, the report showed.
In Singapore, the stocks index clawed back early losses in last hour of trading to finish the session higher, as investors chased bargain hunting, buoyed up on tracking gains in Asian bourses. Finance and properties surged on tracking sharp recovery in shanghai bourses in a bout of late-session buying; meanwhile bargain hunting was evident in manufacturers and multi-industries on hopes for recovery in demand. The blue chip Straits Times Index leaped 37.20 points, or 1.74%, to 2,176.98.
On the economic front, Singapore April non-oil domestic exports down 19% on year vs. 17% fall in March, meanwhile NODX fell seasonally adjusted 1.3% month-on-month in April, reversing a 10% rise in March, according to Trade and Industry Ministry figures released Monday.
In Taiwan, stock market continued its upward run by closed the day higher, as Chinese measures to forge closer trade ties with Taiwan spurred buying in transport, tourism and property shares.
In line with the pledge of its leaders to help Taiwan alleviate its plight amid the global economic downturn, Mainland Chinese authorities offered a package of eight favorable economic measures for Taiwan, including the signing of a framework agreement for cross-Strait economic cooperation.
At the Fujian Cross-Strait Forum, Wang Yi, director of Taiwan Affairs Office, under the The Chinese government will also encourage more Chinese tourists to visit Taiwan, with the aim of boosting their number to over 600,000 this year. Moreover, the Chinese government will encourage and assist qualified Taiwanese enterprises to tap the Chinese market and take part in major infrastructure facilities and construction projects, conceived mainly for boosting domestic demand.
The main Taiex share index gained further as Taiex added 63.63 points or 0.97%, closing the day at 6577.81, highest closing since 11 May 2009 when market closed the day at 6647.50.
In Philippines, the stock market opened the week on a negative note, as investors engaged in profit taking activities. Moreover, hefty losses in the key heavyweight stocks also dragged the composite index lower. At the final bell, the benchmark index PSEi slipped 1.27% or 29.33 points to 2,279.37, while the All Shares index fell 0.78% or 11.56 points to 1,465.84.
On the economic front, the country’s external payments position improved in April to an almost complete reversal from the deficit posted the month before, the central bank reported today. Bangko Sentral ng Pilipinas (BSP) data released today showed the country’s balance of payments (BoP) swinging to a $466-million surplus in April, or an almost complete reversal from the $472-million deficit in March. This brought the year-to-date BoP to a surplus of $2.2 billion as of the end of last month, the BSP said.
Elsewhere, Malaysia's Kula Lumpur Composite index was down 0.22% or 2.20 points to 1012.01 while Indonesia’s Jakarta composite index jumped 3.01% or 52.65 points ending the day at 1803.57.
In other regional market, European shares shook off early weakness to trade higher Monday, as gains for banks such as HSBC Holdings and UniCredit offset weakness in most metal stocks. The U.K.'s FTSE 100 index rose 1.1% to 4,394.66 in Monday's action, while the German DAX 30 index climbed 0.3% to 4,751.60 and the French CAC-40 index rose 0.2% to 3,174.44.
In the UK, Rightmove House Price raised +2.4% mom, the 4th consecutive monthly increase, in May after gaining +1.8% a month ago. It's also the largest rise since the survey began in 2003. On annual basis, the reading fell -6.2%, compared with -7.3% in the previous month. The moderation in decline indicated the market turned more optimistic about the housing market.
Looking ahead, in the US, NAHB housing market index set to increase further in May after adding 5 points to 14 in April. Recent rise in the index suggested that new home sales might improve soon. US' Treasury Secretary Timothy Geithner will speak at 1530 GMT.
Post Session Commentary - May 18 2009
Market trading was halted for the day after benchmark indices triggers final upper limit of 20%. At around 11.55 am, the BSE Sensex touched the highest mark of 14,272.63 with rise of 17.24% and NSE Nifty touched the uppermost level of 4,384.30, which was 19.41% up from previous closing. The rally was backed by the surprised win for the UPA government (lead by 262 seats) in the 15th Lok Sabha election, which brought great cheers for the investors. Market is hopeful as less number of allies will direct to a stable government which will run its track of five years. SEBI, today vide their circular No. SMD/RPD/Policy/Cir-37 dated June 28, 2001 has stipulated that the index based market wide circuit breaker system shall apply at three stages of the index movement either way at 10%, 15% and 20%. Since the indices breached 20% level, there will be no further trading today.
The domestic market opened with a sharp gap and suddenly locked in at upper circuit. Trading had been halted for an hour. The market reopened at 10.55am. The sharp upward rally on Monday was in reaction to UPA’s stunned win at the general elections. The benchmark indices touched the psychological mark of 15% after one hour of halt and trading stopped once again till 11:55am as NSE Nifty hit 15% upper circuit the second 5% filter. Further, market resumed trading at 11:55am (IST) before finally halting the trading as crossed the final upper limit of 20%. On the sectoral front, all indiced ended with huge gains. Among those, most of the buying was seen in Realty, Capital Goods, Bank, Oil & Gas, Power, Metal, PSU and Teck stocks.
Among the Sensex pack all 30 stocks ended in green territory. The market breadth indicating the overall health of the market remained extremely positive as 833 stocks closed in green while 11 stocks closed in red and 2 stocks remained unchanged in BSE.
The BSE Sensex was up by 2,099.21 points at 14,272.65 and NSE Nifty was higher by 636.40 points at 4,308.05. The BSE Mid Cap increased by 276.06 points or 7.25% to 4,083.13 and the BSE Small Cap grew by 218.33 points or 5.10% to 4,497.93.
Gainers from the BSE Sensex pack are BHEL (32.72%), L&T Ltd (29.53%), DLF Ltd (25.82%), ICICI Bank (25.30%), HDFC (23.46%), Reliance (22.87%), RCom (22.74%), Bharti Airtel (22.53%%), Reliance Infra (22.02%), JP Associates (20.91%), SBI (20.76%), Tata Steel (17.60%), Sterlite Industries (16.53%), HDFC Bank (16.48%), Tata Motors (16.05%), Grasim Industries (14.26%), Wipro Ltd (13.83%), Hindalco (13.64%), Tata Power (13.38%) and ONGC Ltd (13.17%).
On the global markets front the Asian markets which opened before the Indian market, are trading mixed. Shanghai Composite, Hang Seng and Straits Times index are trading up by 7.52, 181.27 and 33.56 points at 2,652.78, 16,971.97 and 2,173.34 respectively. However, Nikkei 225 and Seoul Composite trading lower by 226.33 and 5.05 points at 9,038.69 and 1,386.38 respectively.
The BSE Realty index gained (25.37%) or 610.11 points to close at 3,014.98. Gainers are Indiabull Real (38.51%), Unitech Ltd (29.41%), DLF Ltd (25.81%), Housing Development (23.39%), Orbit Co (19.99%) and Parsvnath (19.94%).
The BSE Capital Goods stocks increased by (23.47%) or 2,036.30 points to close at 10,712.65. Major gainers are BHEL (32.72%), L&T Ltd (29.53%), Punj Lloyd (23.20%), Punj Lloyd (22.56%), Areva (20.99%) and Jyoti Struct (19.99%).
The BSE Bank index gained (20.27%) or 1,292.27 points at 7,667.92 hopes falling interest rates will boost lending growth. Scrips that gained are ICICI Bank (25.30%), Bank of Baroda (21.24%), Indian Overseas Bank (21.21%), SBI (20.76%), Yes Bank (20.48%) and Allahabad Bank (17.25%).
The BSE Oil & Gas stocks increased by (19.57%) or 1,665.38 points to close at 10,175. Major gainers are Reliance (22.87%), Aban Offshore (21.20%), Reliance Pet (20.23%), RNRL (19.48%), Essar Oil Ltd (15.46%) and Crompton Greaves (14.78%).
The BSE Power was up by (17.09%) or 378.90 points at 2,595.43. Gainers are BHEL (32.72%), GVK Power (27.89%), Suzlon Energy (22.56%), Reliance Infra (22.02%), GMR Infra (21.08%) and Reliance Power (17.49%).
The BSE Metal index advanced by (16.64%) or 1,310.03 points to close at 9,182.73. Main gainers are NMDC Ltd (19.99%), Steel Authority (19.38%), Ispat Indus (18.55%), Jindal Steel (18.51%), Sesa Goa Ltd (18.37%), Gujarat NRE C (18.35%) and JSW Steel (14.78%).
Tata Steel surged 17.60%. The company has taken major initiatives in retail including doubling of its outlets to 1,000 in the next 2-3 years for its branded products. This is in order to promote the sale of its steel products in the country.
MARKET makes a history
The Sensex at the opening bell (9.55am) was 1,306 points up at 13479 and Nifty was 532 points at 4203 and hit the first circuit for the day and also for the first time in the history of the Indian stock exchanges and the markets were closed for two hours. At 11.55am when the market opened again, the Sensex gained another 700 points and Nifty 150 points and hit the second circuit of the day and the market was closed for the day. For the day, the Sensex gained 2,111 points or 17.34% and closed at 14284 while Nifty gained 636 points to wrap the session at 4308.
The market breadth, the number of advancing shares to declining shares, was highly tilted in favour of advancing shares. Of the 846 stocks traded on the BSE, 833 stocks advanced, whereas 11 stocks declined. Two stocks ended unchanged. Of the 13 sectoral indices on the BSE, all closed positive gaining in the range of around 7-23%. BSE Realty moving up by 23.45% topped the list, while BSE CG (capital goods’ index), occupying the second slot, was up by around 21.90%. BSE Bankex (up 19.18%), BSE Oil & Gas (up 19.11%), BSE Power (up 18.33%), BSE PSU (up 16.42%), BSE Metal (up 16.10%) and BSE Teck (up 14.02%) posted significant gains for the day. Remaining indices were up 7-13% each.
Realty stocks were in limelight and closed with strong gains. Indiabulls Real Estate vaulted 38.51% at Rs205, Unitech soared 29.41% at Rs66, Housing Development and Infrastructure Ltd surged 26.08% at Rs229.90 and Orbit Corporation advanced 20% at Rs87.05.
Gateway Distipark attracted volumes of over 10 lakh shares on the BSE followed by Cals Refineries (6 lakh shares), K Sera Sera Productions (5 lakh shares) and IFCI (5 lakh shares).
Sensex vaults 17% as market cheers UPA's thumping victory in election; trading halted for the day
A clear mandate for the Congress-led United Progressive Alliance (UPA) in Lok Sabha election send stocks surging with trading on the bourses halted for the day at about 11:55 IST. For the first time in the history of the stock markets trading was halted because the market-wide circuit were applied due to a solid surge. Earlier, there have been instances when trading was halted when market-wide circuit filters were applied due to a market crash.
The 30-share Sensex jumped 2110.79 points or 17.34% at 14,284.21 and the 50-unit S&P CNX Nifty gained 651.50 points or 17.74% to 4,323.15.
BSE clocked a paltry turnover of Rs 77 crore. The combined turnover in the cash and the derivatives segment of BSE and NSE totaled Rs 3103. Only 846 stocks were traded on the BSE while 202 stocks witnessed action on the NSE.
Trading was halted in just 16 seconds after the market re-opened at 11:55 IST. Earlier in the day, trading was halted within seconds of opening as the market soared following a clear mandate for the UPA in the Lok Sabha election. A clear mandate for the Congress-led United Progressive Alliance (UPA) boosted hopes a strong coalition would be able to push through economic reforms that would boost foreign investment. The 30-share Sensex surged 14.70% or 1,789.88 points to 13,963.30 and the 50-unit S&P CNX Nifty gained 531.65 points or 14.48% to 4203.30, when trading was halted within seconds of opening.
While the solid surge on the bourses in opening trade was not a big surprise, what created confusion among the market was the level at which the circuit filters were applied. The market-wide circuit filters are applied taking into consideration the Sensex or Nifty's closing level on the last trading day of the previous quarter - this time based on the closing of Nifty or Sensex on 31 March 2009. If that be so, the market wide circuit filters should have applied at a gain of 975 for Sensex or a gain of 300 of Nifty whichever was achieved earlier
The index-based market-wide circuit breaker system applies at 3 stages of the index movement, either way viz. at 10%, 15% and 20%. These circuit breakers when triggered, bring about a coordinated trading halt in all equity and equity derivative markets nationwide. The market-wide circuit breakers are triggered by movement of either the BSE Sensex or the NSE S&P CNX Nifty, whichever is breached earlier.
In a circular issued after market hours, the National Stock Exchange (NSE) said the existing policy will continue to govern trading on the exchanges. Accordingly, the first level of the circuit breaker at 10% will be triggered at 300 points for Nifty and 975 for Sensex over the respective closing level of the indices today, 18 May 2009, it said. The second circuit breaker at 15% and the third circuit breaker at 20%, will be triggered at 450 points and 600 points for the Nifty respectively and 1450 points and 1950 points for the Sensex respectively, over the closing levels of today, it said.
For the record, the BSE Sensex today attained its highest closing since 11 September 2008 and the S&P CNX Nifty attained its highest closing since 10 September 2008.
As per the provisional data released by the stock exchanges after trading hours, foreign funds today bought shares worth a net Rs 44.64 crore. Domestic institutional investors sold shares worth a net Rs 8.41 crore.
The market breadth, indicating the overall health of the market, was strong. On BSE, 833 shares rose as compared with 11 that fell. A total of 2 shares remained unchanged.
The BSE Mid-Cap index rose 12.06% and the BSE Small-Cap index rose 9.09%. However, both these indices underperformed the Sensex.
The BSE Realty index (up 25.37%), the BSE Capital Goods index (up 23.47%), the BSE Bankex (up 20.27%), the BSE Oil & Gas index (up 19.57%) outperformed the Sensex.
The BSE FMCG index (up 6.78%), the BSE Healthcare index (up 8.04%), the BSE IT index (up 11.41%), the BSE Auto index (up 12.12%), the BSE Consumer Durables index (up 13.63%), the BSE TECk index (up 14.95%), the BSE PSU index (up 15.76%), the BSE Metal index (up 16.64%), the BSE Power index (up 17.09%), underperfomed the Sensex.
The market soared today, 18 May 2009, following a thumping victory of the Congress-led United Progressive Alliance (UPA) government in the Lok Sabha elections. A clear mandate for the UPA boosted hopes a strong coalition would be able to push through economic reforms that would boost foreign investment
The Sensex has risen 4636.90 points or 48.06% in calendar year 2009. From a 3-year closing low of 8,160.40 on 9 March 2009, the has Sensex has surged 6,123.81 points or 75.04%.
Coming back to today's trade, Bharat Heavy Electricals, Reliance Industries, HDFC, Reliance Infrastructure, ICICI Bank, Bharti Airtel, Larsen & Toubro, DLF, Reliance Communications, Jaipraksh Associates, State Bank of India, rose by between 20.76% to 32.72%.
Infrastructure shares jumped on hopes the Congress-led UPA government may boost spending on infrastructure sector after emerging victorious in the general elections. India's biggest engineering & construction firm by revenue L&T rose nearly 30% to Rs 1280. India's biggest power equipment maker by revenue Bharat Heavy Electricals rose 32.7% to Rs 2266.
Among other infrastructure stocks, Jaiprakash Associates, Gammon India, GVK Power & Infrastructure, GMR Infrastructure, and IVRCL Infrastructures & Projects rose 20% to 38.3%
Punj Lloyd surged 23.2% ahead of the Q4 March 2009, ahead of the announcement its Q4 March 2009 results later today, 18 May 2009.
Shares of power and capital goods companies surged following a thumping victory of the Congress-led United Progressive Alliance (UPA) government in the Lok Sabha elections, clearing the way for the landmark civilian nuclear deal with the US. Areva T&D jumped 21%, Reliance Infrastructure rose 22%, Hindustan Construction Company rose 25%, Crompton Greaves rose 13.8%, Tata Power Company rose 13%, Rolta gained 13%, ABB rose 13.9%, NTPC gained 11.9%, and Walchandnagar Industries rose 10%
State-run companies advanced on hopes of recommencement of the PSU disinvestment programme after the Congress-led UPA government got a clear mandate in the Lok Sabha election. Dredging Corporation of India rose 20%, Engineers India advanced 19.3%, HMT rose 20%, Neyveli Lignite Corporation advanced 17%, Shipping Corporation of India rose 10%, Hindustan Copper rose 10%, MMTC rose 20%, NMDC rose 20%, Power Finance Corporation rose 13.3% and Central Bank of India rose 18%
It may be recalled that the BJP-led National Democratic Alliance (NDA) had vigorously pursued PSU divestment. However, it was put in deep freeze in the last five years by the Congress-led United Progressive Alliance (UPA) government as the Left parties which supported the UPA government from outside, were bitterly opposed to the idea.
Consequently, in the past five years, the government raised just Rs 8,500 crore from disinvestment as against Rs 28,000 crore raised by the BJP-led government in the preceding five-year period.
The UPA government's thumping victory in the 15th Lok Sabha elections without the support of the Left parties has raised expectations that the government may revive disinvestment programme. The Congress party had in its manifesto released before polls promised to go ahead with disinvestment while retaining a majority holding in the state-run companies.
India's largest bank in terms of assets and branch network State Bank of India soared 20.76% on hopes the Congress-led UPA government may go ahead on a plan to merge six associate banks with State Bank of India to create a Indian banking behemoth.
The process of creating a Indian banking behemoth was set in motion two years ago, but got derailed due to resistance from the Left parties. Although the board of SBI and its associate bank, the State Bank of Saurashtra, had approved the merger in August 2007, the government approved it only in August 2008 after the Left withdrew its support to the government.
A merger of the associate banks with itself will give SBI the full benefit of size. SBI and its associate banks enjoy a fourth of the market share.
The SBI management may well be keen to merge the six associates at the earliest, but that will hinge on government approval since the government controls 59.41% of the equity in the bank.
India's largest motorbike maker by sales Hero Honda Motors soared 15.83% as index focused mutual funds took position in the stock ahead of its entry in the coveted BSE 30-share Sensex with effect from 29 June 2009. After trading hours on Friday, 15 May 2009, the BSE announced that Hero Honda will replace Ranbaxy Laboratories in the barometer index BSE Sensex with effect from 29 June 2009
prime minister Manmohan Singh's coalition defied predictions of a tight election and was only about 11 seats short of an majority from the 543 seats at stake, according to election commission data. Congress' alliance took 261 seats, sweeping aside its nearest rival, the bloc led by the Hindu-nationalist Bharatiya Janata Party (BJP), which won only 159 combined. Congress, which alone won 205 seats, needs a handful of partners to reach the 272 seats needed to take power, and is expected to seek the support of more smaller parties or independents. Congress leaders will meet on Tuesday to officially endorse Manmohan Singh as prime minister, after which the party will meet its coalition partners to decide potential new allies.
Armed with a popular mandate, the Congress led UPA government is going to stake claim today to run India for another five years. The Congress and its allies will go to meet President Pratibha Patil today to show that they have the numbers. The first meeting of the newly-constituted Congress Parliamentary Party (CPP) is expected to convened in a day or two to elect its leader. Singh, who is already the Prime Ministerial candidate of the Congress, is also likely to be elected by the MPs at a joint meeting of the UPA parties. The Congress must form a government by 2 June 2009.
Financial sector reforms are likely to get a push in the coming days, which were relegated to the back seat due to persistent opposition from the Left parties, with the Congress-led UPA set to form the next government. Left-less victory of the UPA over BJP-led National Democratic Alliance (NDA) would not only signify the formation of a stable government, but also revive hopes of a slew of pro-market policy changes.
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