Nifty at new peak on short covering in derivatives, firm Asian markets

The market surged today on continued buying and strong global markets. Upbeat January-March 2007 GDP growth data and short-covering in derivatives ahead of expiry of May 2007 derivatives contracts also aided the upmove. Today's high of Sensex of 14573.81 is its highest level in more than 3-½ months since 9 February 2007. S&P CNX Nifty struck an all time high 4,306.75 in late trade. All the sectoral indices on BSE settled with gains.

Volatility was the hallmark of the day, which was but obvious as the May 2007 contracts were to expire today. The market held firm right from the opening bell as the market-wide rollover of 63% and Nifty rollover of 59%, by Wednesday, 30 May 2007, meant that most of the rollover had already happened.

Sensex surged 133.08 points or 0.92% to settle at 14,544.46. It opened higher at 14,451.31 and surged to an intra-day high of 14,573.81 at the onset of the trading session tracking firm global markets.

The S&P CNX Nifty rose 46.15 points or 1.09% at 4,295.8, a lifetime closing high.

The Nifty June 2007 futures settled at 4278.10, a discount of 17.70 points compared to the spot closing of 4,295.80. It also surged to an all time high above 4,300 mark at 4,325.

The turnover picked-up in the wake of derivatives expiry today. Turnover vaulted to Rs 52,950.90 crore on NSE’s F&O segment from Rs 50,481.89 on 30 May 2007. It was Rs 43,290.08 crore on 29 May 2007.

The Sensex is just about 175 points away from its all time high of 14,723.88 struck on 9 February 2007.

India's economy grew 9.1% in January-March 2007 quarter, from a year earlier, led by robust manufacturing, and services sector growth. The government released the data in mid-morning trade today.

The GDP growth was 9.4% in fiscal-year ended March 2007, which is higher than government estimate of 9.2%, and the fastest growth in 18 years. Farm sector output in the January-March 2007 quarter grew an annual 3.8%, manufacturing rose 12.4% and construction 11.2%. Trade, hotels, transport and communications segment recorded a strong 12.4% growth.

The market breadth, which indicates overall health of the market was strong on BSE, with 1380 shares advancing as compared to 1198 that declined. 93 remained unchanged. It was, however, much stronger in morning session, when 1196 shares had advanced as compared to 381 that had declined.

The BSE Mid-Cap Index settled at 6,222.40, a gain of 31 points or 1.01% while the BSE Small-Cap Index advanced 87 points or 0.9% to 7,413.03

The total turnover on BSE was Rs 4511.34 crore, as compared to Rs 5303 crore on Wednesday, 30 May 2007.

Among the Sensex pack, 21 advanced while the rest slipped.

Bike maker Hero Honda surged 5.03% to Rs 732.50, on 2.02 lakh shares, and was the top gainer. The company that launched eight models in the last fiscal, will look at a slew of more launches and some facelifts in the current year.

Other auto stocks also participated in the rally. Maruti Udyog (up 2.73% to Rs 824.80), and Tata Motors (up 1.87% to Rs 756) rose. The BSE Auto index rose 1.3% to 5012.28.

Shares from banking & financial services space advanced on renewed buying. The BSE Bankex gained 1.4% at 7,607.35 HDFC Bank (up 4.01% to Rs 1148.90), ICICI Bank (up 0.99% to Rs 920), State Bank of India (up 2.11% to Rs 1352.65), and HDFC (up 2.03% to Rs 1866) rose.

Index heavyweight Reliance Industries (RIL) advanced 0.41% to Rs 1760 on 5.81 lakh shares. Its all time high is Rs 1785.

State run engineering major Bhel turned ex-bonus today. It settled at Rs 1397.95, compared to its previous close of Rs 2768.30. It also slipped to a low of Rs 1351 today. The bonus ratio was 1:1.

NTPC (down 1.85% to Rs 157.35), Dr Reddy’s (down 1.12% to Rs 647.10) and Gujarat Ambuja Cements (down 1.13% to Rs 113.80), edged lower.

Engineering and construction major Larsen & Toubro was up 0.32% to Rs 2000, on 4.13 lakh shares. It also struck an all time high of Rs 2058, in intra-day trade. It reported 50% rise in net profit to Rs 701 crore in Q4 March 2007 from Rs 467 crore in Q4 March 2006, during market hours on 29 May 2007. Sales rose 35.01% to Rs 6248.24 crore in the Q4 March 2007 as against Rs 4627.87 crore in previous Q4 March 2006. The results were announced during trading hours on Tuesday, 29 May 2007.

IT pivotals advanced, after staying weak in the last few weeks, on renewed buying. The BSE IT index rose 0.8% at 4,851.43. Satyam Computers (up 0.82% to Rs 469), Infosys (up 1.14% to Rs 1926) and Wipro (up 1.11% to Rs 542) gained, while TCS lost 0.21% to Rs 1211. IT stock have not performed in the market's recent surge due to stronger rupee. A rise in the rupee directly impacts revenue and profit of IT firms, which derive a lion’s share of revenue from exports to the US.

The Indian rupee climbed today, 31 May 2007, after falling nearly 1% in the previous session, as firm Asian stock markets bolstered expectations of a fresh wave of capital inflows into local equities.

Unitech (up 1.81% to Rs 577.80), Aditya Birla Nuvo (up 2.76% to Rs 1393) and Videocon Industries (up 4.53% to Rs 480) surged on the eve of their inclusion in MSCI index from Friday, 1 June 2007.

MIC Electronics was the top traded counter on BSE with total turnover of Rs 252.30 crore followed by India Infoline (Rs 112.60 crore), Unitech (Rs 103.35 crore), Reliance Industries (Rs 103 crore) and SBI (Rs 83.30 crore).

While from the volumes point of view, Reliance Natural Resources (RNRL) was the topper on BSE with total volume of 1.55 crore shares followed by MIC Electronics (65.20 lakh shares), Insecticides India (58.80 shares), Srei Infrastructures (54.70 lakh shares) and Reliance Petroleum (46.65 lakh shares).

McDowell Holdings jumped 20% to Rs 234.70, with the stock showing a strong momentum a day after it was listed on the bourses yesterday, 30 May 2007. The share price had hit the roof on the first day of its listing on 30 May to Rs 195.60, surging 20%, compared to the base price of Rs 163.

The listing McDowell Holdings (MHL) on the bourses took place following a restructuring scheme undertaken at United Spirits (USL) whereby investment business of USL was transferred to MHL as a going concern.

MIC Electronics surged 20% (maximum limit) to Rs 402.75. Pent up demand in its IPO which was subscribed a whopping 50 times, appears to be driving up the stock price. The stock had sizzled on its debut on Wednesday 30 May 2007. It had settled at Rs 335.65 on that day, a premium of 124% over IPO price of Rs 150. The combined volumes in the stock on BSE and NSE on Wednesday 30 May 2007 had aggregated 3.46 crore shares. This is over 6 times of 51 lakh shares that were in the offer through its IPO which closed early this month.

Insecticides India surged 11.14% to Rs 121.70 on high volumes of 58.55 lakh shares. The stock had settled at Rs 109.50 on BSE, a discount of 4.7% over IPO price of Rs 115, on 30 May 2007.

Shasun Chemicals and Drugs surged 20% to Rs 116.15 after it posted 110.49% growth in consolidated revenue at Rs 793.34 crore in the financial year ended March 2007 compared to Rs 376.90 crore in FY06. Consolidated net profit increased 43.19% at Rs 52.62 crore (Rs 36.74 crore).

The company posted 134.54% spurt in consolidated net sales to Rs 238.06 crore in Q4 March 2007. Consolidated net profit grew 40.79% at Rs 17.54 crore in Q4 March 2007.

TVS Electronics rose 19.99% to Rs 50.20 on announcement of selling of its contract manufacturing services business in Karnataka to a unit of Finland's Incap Corp. TVS Electronics said during trading hours on Thursday, 31 May 2007, that it sold its contract manufacturing services (CMS) business in Karnataka for Rs 41.12 crore to a unit of Finland's Incap Corp.

Budget airline Deccan Aviation spurted 14% to Rs 149.60 boosted by reports that Vijay Mallya, founder of Kingfisher Airlines bought 26% stake in the low cost carrier at Rs 150 per share.

SREI Infrastructure Finance galloped 20% to Rs 71.80 on announcement of its joint venture with BNP Paribas group for infrastructure equipment financing in India. The alliance will involve setting up of a new 50:50 joint venture (JV) company. The current infrastructure equipment financing business of SREI Infrastructure Finance along with its insurance broking activity will be transferred to this new JV.

Tata Tea surged 5.28% to Rs 923, while Mount Everest Mineral Water jumped 5% to Rs 127.65 on reports that the former will acquire majority stake in the later.

Ramco Systems shed 2.25% to Rs 132.50 after it posted higher net loss of Rs 18.02 crore in Q4 March 2007 as against net loss of Rs 3.82 in Q4 March 2006. Sales declined 42.61% to Rs 19.38 crore (Rs 33.77 crore). The company posted a loss of Rs 32.20 crore in the year ended March 2007 (FY 2007) as against loss of Rs 34.07 in FY 2006. Sales dipped 33.1% to Rs 78.57 crore ( Rs 117.47 crore).

Easun Reyrolle surged 3.53% to Rs 822.10 after the company reported 134.7% growth in net profit in Q4 March 2007 to Rs 6.76 crore from Rs 2.88 crore in Q4 March 2006. Net sales rose 44% to Rs 46.15 crore (Rs 32.05 crore).

The net profit rose 35.1% to Rs 17.67 crore in the year ended 31 March 2007 from Rs 13.08 crore in the year ended 31 March 2006. Net sales rose 25% to Rs 132.96 crore (Rs 106.40 crore). The company’s board also approved a 5-for-1 stock split.

Tata Power company declined 2.34% to Rs 577 on reporting 30.20% decline in net profit Q4 March 2007 to Rs 92.73 crore as against Rs 138.82 crore in Q4 March 2006. Sales declined 19.10% to Rs 947.40 crore in Q4 March 2007 (Rs 1171.10 crore).

The net profit rose 14.13% to Rs 696.80 crore in the year ended 31 March 2007 (FY 2007) as against Rs 610.54 crore in FY 2006. Sales rose 3.95% to Rs 4715.32 crore in FY 2007 (Rs 4536.32 crore).

Welspun India declined 1.06% to Rs 70 after it reported 3.92% fall in net profit in Q4 March 2007 to Rs 10.29 crore from Rs 10.71 crore Q4 March 2006. Sales rose 21.14% to Rs 248.46 crore (Rs 205.10 crore). The net profit rose 25.39% to Rs 52.10 crore in the year ended March 2007 from Rs 41.55 crore in FY 2006. Sales rose 46.93% to Rs 973.56 crore (Rs 662.60 crore).

India Infoline jumped 5.66% to Rs 658.55 extending its recent solid surge that was triggered by four top officials from a rival brokerage joining the firm earlier this week. The brokerage inducted four top officials of the foreign brokerage CLSA. The market believes that inducting four top officials from rival brokerage would help the firm significantly expand its client base. India Infoline hired the executives to help grow its investment banking, institutional equities and asset management businesses. The four executives have the right to buy nine million shares of India Infoline at Rs 440 a piece.

Transformer oil maker Apar Industries lost 5.69% to Rs 160 after it reported 33.56% fall in net profit in Q4 March 2007 to Rs 10.73 crore from Rs 16.15 crore in Q4 March 2006. Sales rose 26.41% to Rs 414.61 crore (Rs 327.99 crore). The company’s net profit rose 15.01% to Rs 45.97 crore in the year ended March 2007 as against Rs 39.97 crore in the year ended March 2006. Sales rose 34.62% to Rs 1468.76 crore (Rs 1091.03 crore).

BL Kashyap & Sons saw high volatility today. It had surged to a high of Rs 1675, in early trade, but slipped from there and settled 2.63% down at Rs 1515. It bagged fresh construction orders worth Rs 1007 crore. The announcement was made after market hours on Wednesday, 30 May 2007.

Asian & European markets were trading strong. Japan's Nikkei 225 average surged 287.49 points or 1.63% at 17,875.75. Hong Kong's Hang Seng index advanced 340.71 points or 1.68% at 20,634.47. Shanghai Composite gained 56.56 points or 1.40% to 4,109.65

US stocks rose on Wednesday, 30 May 2007, with Standard & Poor's 500 indexing striking to its first record close in more than seven years, as investors grew more confident that the Federal Reserve might cut interest rates in the second half of 2007. The Dow Jones industrials also reached a new closing high.

The Dow Jones Industrial Average surged 111.74 points or 0.83% to 13,633.08, and also reached a new all time high of high of 13,636.09. The S&P 500, surpassed the record of 1,527.46, set 24 March 2000, at the peak of the dot-com boom, closing at 1,530.23, up 12.12 points, or 0.80%. The Nasdaq Composite index rose 20.53 points, or 0.80%, at 2,592.59.

Oil prices fell on Thursday ahead of the release of a US government report which expected to show US crude and gasoline supplies rose last week. Light, sweet crude for July 2007 delivery dropped 13 cents to $63.36 a barrel in Asian electronic trading on the New York Mercantile Exchange, mid-morning in Singapore. The contract on Wednesday, 30 May 2007, rose 34 cents to settle at $63.49 a barrel.

July Brent crude lost 4 cents to $67.80 a barrel on the ICE Futures exchange in London, after tumbling 50 cents overnight to settle at $67.84 a barrel.

Foreign institutional investors sold shares worth Rs 377.10 crore on Wednesday, 30 May 2007.