Major events keep market under pressure

The market was under pressure throughout the week, weighed by lot of domestic and global events. High degree of volatility was seen throughout the week.

The BSE Sensex lost 1.06% to 13,796.16 while the S&P CNX Nifty was down 0.98% to 4,076.6

The week started on a weak note, with the Sensex declining 55.02 points to 13,879.25, on Monday due renewed selling, led by IT pivotals.

The weak trend continued at day later, as the BSE Sensex lost a further 113.79 points to 13,765.46, due to lack of buying support, as investors watched from the sidelines ahead of major local and global events scheduled later in the week. Subdued Asian and European stocks also were of not much help.

The 30-shares BSE Sensex settled 16.05 points higher on Wednesday at 13,781.51, as buying resumed for index pivotals. Strong global markets also helped the sentiment.

The barometer index lost 10.28 points, to 13,771.23, on Thursday as a late sell-off pulled the market in the red at closing bell.

Sensex gained 24.93 points on Friday to settle at 13,796.16, amidst intense volatility. Global markets, Uttar Pradesh election results, inflation and industrial production figures, made it swing sharply.

Tata Steel was up 2.97% to Rs 569.70. The steel major is seen reporting strong numbers when it unveils its FY 2007 (year ended 31 March 2007) results on 17 May 2007 on higher steel prices.

Ranbaxy Laboratories gained 2.30% to Rs 390.75. The pharma major is planning to invest around Rs 60 crore to upgrade the recently acquired Be-Tabs Pharma units in South Africa. With the revamp of the Be-Tabs facilities, the company expects to lead the way for generics manufacturing in South Africa, says a company statement. The acquisition substantially strengthens the basket of products that Ranbaxy brings to the market, specially in the acute and over the counter product streams.

IT major TCS slipped 1.70% to Rs 1252.70, on renewed selling. TCS, a leading global IT services, business solutions and outsourcing firm, announced its tie-up with Microsoft Corporation to deliver RFID (radio frequency identification) solutions to global companies. It launched an initiative to develop RFID solutions built on Microsoft BizTalk

Bajaj Auto advanced 5.90% to Rs 2718.60, on its proposal to split the company into two. The market has been agog with talks of a split since the last two years. Transferring some of the Rs 6500-crore cash will improve the finance and insurance businesses, chariman Rahul Bajaj had said earlier. Bajaj Auto is in both general as well as life insurance businesses through Bajaj Allianz General Insurance Company and Bajaj Allianz Life Insurance Company, respectively. Bajaj Auto holds a 74% stake in both firms with the rest held by Allianz. Bajaj Auto is also into the business of lending money through Bajaj Auto Finance, a listed entity. Bajaj Auto holds over 38% stake in Bajaj Auto Finance.

Reliance Industries (RIL) rose 0.58% to Rs 1590.25. RIL is silently lining up a Rs 3,000-crore home solutions retail venture. Its retail arm, Reliance Retail, will roll out a chain of 100 stand-alone specialised home solution outlets, each spread over 40,000-60,000 sq ft, over the next three years.

State Bank of India (SBI) edged higher by 1.81% to Rs 1149.20 on expectations of good Q4 ending March 2007 results.

ACC declined 1.01% to Rs 850.35. Swiss cement maker Holcim had acquired an additional 3% stake in ACC, bringing its total stake to around 41%. Holcim today acquired 58.59 lakh shares of ACC, constituting a little above 3% equity of the company through a block deal executed on NSE for a weighted average price of Rs 899.07, on 8 May.

Maruti Udyog (MUL) slipped 1.37% to Rs 795.30. The Union government exited the country’s largest car maker on Thursday, 10 May 2007,selling its residual stake for Rs 2,360 crore to a clutch of financial institutions led by Life Insurance Corporation (LIC). The government had offered 2.96 crore shares in the company, representing 10.27% stake. Of this, LIC got all the 1.3 crore shares it had bid for at a price of Rs 800 per share. LIC now controls 12.5% and has become the second-largest shareholder in the company.

In all, 32 financial institutions and mutual funds have been alloted shares. State Bank of India (SBI) emerged as the second most successful bidder with 83 lakh shares at Rs 775 each. Corporation Bank and Exim Bank submitted the highest bids at Rs 850 per share. Both were granted 5.88 lakh and 1.18 lakh shares respectively.

Among mutual funds, Reliance Mutual Fund and HDFC Mutual Fund got 20 lakh and 10 lakh shares, respectively. SBI MF also got 49.76 lakh shares at Rs 775 per share and Punjab National Bank 12.29 lakh shares at Rs 815 per share.

Tech Mahindra lost 8.43% to Rs 1511. Tech Mahindra’s consolidated net profit (excluding exceptional items) jumped 120% in Q4 March 2007 at Rs 196.1 crore compared with Rs 89.1 crore in the corresponding quarter of the previous financial year. Revenue surged 108% to Rs 874.5 crore compared with Rs 421.2 crore in the fourth quarter of the previous year. Tech Mahindra incurred a one-time exceptional charge towards an upfront payment of Rs 524.9 crore to a customer and has reported a net loss of Rs 328.9 crore in Q4 March 2007.

Fortis Healthcare, which listed on 9 May, settled at Rs 100, a discount over the IPO price of Rs 108 per share. The stock debuted at Rs 105, and surged to a high of Rs 109.10. Its low for the day was Rs 97.90.

Fortis Healthcare had priced its 4.59-crore equity shares at Rs 108. The price band for the IPO was Rs 92 to Rs 110 per share. The issue, which had opened for subscription on 16 April 2007 and closed on 20 April 2007, was subscribed 2.78 times. The qualified institutional buyers (QIB) portion was subscribed 2.72 times, non-institutional portion 1.74 times and the retail portion 3.26 times

On 9 May 2007, US Federal Reserve’s decision kept interest rates steady. On that very day, the European Central bank (ECB) held its rates steady at 3.75%

The Bank of England raised interest rates to a six-year high of 5.5% on 10 May 2007, as it voiced concern that diminishing spare capacity in the UK economy and greater pricing power skewed inflation risks to the upside. On the same day, the European Central Bank kept its key lending rate unchanged at 3.75%

India's industrial production rose 12.9% per annum in March 2007, from a year earlier, higher than downwardly revised annual growth of 10.8% in February, due to strong manufacturing output, government data showed on Friday, 11 May 2007. Analysts had forecast annual industrial output growth of 10.40%.

Full year 2006-07 industrial output jumped 11.3% from the same period a year earlier. Manufacturing production, which represents more than 75% of industrial output, surged 14.1%per annum in March 2007, from March 2006 compared with a 12.30% annual growth in February 2007. Annual industrial output growth in March 2006 was 8.9%. Annual manufacturing growth in March 2006 was 10.10%.

India's wholesale price index rose 5.66% in the 12 months to 28 April 2007, lower than the previous week's increase of 5.77% per annum due to a decline in some food prices, data released showed on 11 May. The figure was lower than a forecast of 5.73% in analyst poll.

India’s largest real estate developer DLF said on Monday (7 May) an initial public offering of 10.2% of the company should take place in the next three months as it had received regulatory approval for the sale. In 2006, the New Delhi-based DLF had dropped plans for what would have been India's biggest IPO due to a sharp market fall. At that time, the IPO was expected to raise up to $3.5 billion.