IT stocks stage a comeback

The market posted modest gains amid high volatility today, 26 July 2007, the day the July 2007 derivatives contracts expired. It was firm in the first half of the day following healthy rollover of derivative positions from the July 2007 series to the August 2007 series. But it weakened in mid-afternoon trade on profit booking, before bouncing back again in late trade. The turnover in NSE's derivatives segment hit record high for the third consecutive day.

Shares from auto, pharma and IT sectors were in demand, while cement, banking and capital goods stocks edged lower. Sugar stocks spiked at the fag end of the trading session. Global markets were subdued.

Meanwhile, the International Monetary Fund (IMF) on Wednesday, 25 July 2007, revised upwards its growth projections for the global economy, citing accelerating growth in China, India and Russia, while the United States appears to be regaining momentum. The IMF's updated World Economic Outlook forecast global growth of 5.2% for both calendar year 2007 and 2008, up from its earlier forecast of 4.9% growth for both years.

The BSE 30-share Sensex rose 76.98 points to 15,776.31. It opened higher at 15,768.28 and jumped to a high of 15,812.27. The index also slipped to a low of 15,654.40 at 13:01 IST

The S&P CNX Nifty was up 31.10 points to 4,619.80. The Nifty July 2007 derivatives contracts expired today. Nifty August 2007 futures settled at 4581.50, a sharp discount of 38.30 points as compared to spot closing.

The NSE F&O turnover was a record Rs 79,995.85 crore as compared to Rs 72,365.46 crore on Wednesday, 25 July 2007.

The market breadth, indicating the overall health of the market, held firm as small- and mid-cap stocks saw continued buying interest. On BSE, 1,558 shares advanced as compared to 1,100 that declined, while 73 remained unchanged

The BSE Mid-Cap index rose 35 points or 0.5% to 6,790.50 while the BSE Small-Cap index advanced 90 points or 1.1% to at 8,145.86.

The total turnover on BSE amounted to Rs 5,719 crore as compared to Rs 5,929 crore on Wednesday, 25 July 2007.

Among the 30-Sensex pack, 18 gained and the rest declined

IT pivotals rose on stock-specific buying despite the Indian rupee heading towards a nine-year high on Thursday, 26 July 2007, in anticipation of strong capital inflow.

India’s second largest software services exporter Infosys Technologies gained 1.81% to Rs 2,026 after it bagged a $250-million (around Rs 1,010 crore) contract from Royal Philips Electronics. It is one of the largest acquisition-cum-outsourcing deal by an Indian information technology firm.

TCS (up 3.13% to Rs 1185), Wipro (up 4.22% to Rs 520) and Satyam Computers (up 1.64% to Rs 494.90) gained in anticipation of further mergers and acquisitions activity in the IT sector. The BSE IT Index gained 1.92% at 5,001.24, and was the top gainer among the sectoral indices on BSE.

In early trade, the rupee was at 40.31/32 per dollar, strengthening from the previous close of 40.3500/3575 and inching towards from a nine-year high of 40.20 hit earlier this week.

India’s largest drug manufacturer by sales Ranbaxy Laboratories jumped 9.95% to Rs 375 on 19.34 lakh shares. It was the top gainer from the Sensex pack. The stock rose after Ranbaxy today, 26 July 2007, reached an agreement with GlaxoSmithKline (GSK) to end their litigation in the US on Valtrex (valacyclovir hydrochloride tablets) used in the treatment of herpes.

Other pharma stocks Cipla (up 4.16% to Rs 193.90) and Dr Reddy’s Laboratories (up 0.29% to Rs 667.40) also edged higher. The BSE Health Care Index was up 1.5% at 3,788.36.

Auto stocks advanced on fresh buying interest in anticipation that sales will pick up after monsoon, generally a slack season. Bajaj Auto (up 1% to Rs 2378) and Mahindra & Mahindra (up 2.55% to Rs 802) advanced. The BSE Auto Index closed at 5,096.44, up 1.5%.

Maruti Udyog vaulted 3.38% to Rs 837 after India’s biggest small car maker today, 26 July 2007, reported a 35.1% growth to Rs 499.60 crore in net profit in Q1 June 2007 over Q1 June 2006. Net sales were up 26% at Rs 3,930.82 crore. Maruti Udyog will be renamed as Maruti Suzuki India.

Cement shares declined for the second straight day on fresh selling following reports that the goverment is easing cement import norms in an attempt to rein in prices. India’s second largest cement manufacturer ACC plunged 4.55% to Rs 1,021.80 on 3.82 lakh shares. It was the top loser from the Sensex pack.

Ambuja Cements (down 3% to Rs 124.50) and Shree Cement (down 2.86% to Rs 1,280) also slipped.

Cement scrips had fallen yesterday, Wednesday, 25 July 2007, following reports that the Monopolies and Restrictive Trade Practices Commission (MRTCP) had on Tuesday, 24 July 2007, ordered a probe into the business practices of 14 leading cement manufacturers.

The country’s biggest private sector company Reliance Industries (RIL) advanced 1.92% to Rs 1,940, after striking an all-time high of Rs 1,948. RIL's results are due on Saturday, 28 July 2007. The market expects surprise on the positive side.

Capital goods heavyweights Bhel (down 2.05% to Rs 1,753) and L&T (down 1.13% to Rs 2,544.50) declined on profit booking after a recent rally. The BSE Capital Goods index lost 1.35% to 13,247.03, and was the worst performing sectoral index on BSE

Top cellular services provider Bharti Airtel dropped 2.30% to Rs 925 on profit taking even as it reported robust Q1 June 2007 results. The stock had hit an all-time high of Rs 960 in early trade. Bharti Airtel’s consolidated net profit as per US GAAP jumped 100% to Rs 1,511.60 crore in Q1 June 2007 over Q1 June 2006, exceeding market expectations. Revenue rose 53% to Rs 5,904.60 crore in Q1 June 2007 over Q1 June 2006. Revenue growth was within market expectation.

Bank shares drifted lower on selling pressure. HDFC Bank (down 2.12% to Rs 1,215), State Bank of India (down 1.2% to Rs 1,549) and ICICI Bank (down 1.51% to Rs 945) slipped. With inflation under control, the Reserva Bank of India (RBI) is likely to keep rates steady when the monetary policy comes up for review on 31 July 2007. However, it remains to be seen whether the central bank will raise the cash reserve ratio (CRR) to suck out excess liquidity in the banking system. BSE Bankex lost 1.2% at 8,185.52.

India’s biggest cigarette maker ITC lost 0.21% to Rs 165.50. The stock had surged almost 9% on Wednesday, 25 July 2007, on market talks it may announce demerger of its agri business. ITC announces Q1 June 2007 results tomorrow, 27 July 2007.

Sugar stocks spurted at the fag end of the trading session. Shree Renuka Sugars (up 5.51% to Rs 635), Bajaj Hindustan (up 4.30% to Rs 160.20) and Balrampur Chini Mills (up 5.45% to Rs 70.65), galloped.

NDTV (up 4.44% to Rs 400.90) and IFCI (up 9.43% to Rs 58) rose on build-up of fresh positions after NSE lifted the ban building fresh derivatives positions in these two stocks.

IDFC rose 2.30% to Rs 134.90 after 74.32 lakh shares changed hands at Rs 134 per share on BSE in early trade. IDFC’s net profit rose 38.42% to Rs 167.81 crore in Q1 June 2007 over Q1 June 2006. Total income surged 73.19% to Rs 556.8 crore . The company announced the Q1 results after trding hours yesterday, 25 July 2007.

Cummins India lost 0.17% to Rs 382.80 after it reported 26.07% rise in net profit to Rs 64.02 crore in Q1 June 2007 over Q1 June 2006. Total income was up 38.7% to Rs 565.49 crore in Q1 June 2007 over Q1 June 2006.

3i Infotech rose jumped 5.20% to Rs 306.35 after its net profit rose 39.09% to Rs 21.42 crore in Q1 June 2007 over Q4 march 2007. Sales were up 25.43% to Rs 118.81 crore in Q1 June 2007 over Q4 March 2007.

Drug maker Wochkardt gained 4.47% to Rs 400 after it reported a 39.6% growth in net profit in 39.6% growth in net profit to Rs 69.10 crore in Q1 June 2007 over Q1 June 2006.

Multiplex cinema operator Shringar Cinemas gained 3.16% to Rs 62 after it reported a 314% growth in net profit to Rs 5.22 crore in Q1 June 2007 over Q1 June 2006.

Bombay Dyeing & Manufacturing Company advanced 6.0% to Rs 618 on promoters' intention to raise their stake. The Wadia family, directly and indirectly, owns 43% in the textile company.

Sterlite Industries declined 2.90% to Rs 651 after posting 9.85% fall in net profit in Q1 June 2007 to Rs 201.46 crore over Q1 June 2006. Total income rose 31.70% to Rs 3,165.85 in Q1 June 2007 over Q1 June 2006.

India's largest wind turbine generator Suzlon Energy plunged 7.98% to Rs 1,290 after its net profit declined 53.8% to Rs 89.4 crore in Q1 June 2007 over Q1 June 2006. Total income dipped 8.85% to Rs 862.9 crore in Q1 June 2007 over Q1 June 2006. The company made this announcement before market hours today, 26 July 2007.

Hitachi Home & Life Solutions (India) galloped 11.26% to Rs 123.50 after its net profit jumped 95.83% to Rs 17.37 crore in Q1 June 2007 over Q1 June 2006. Sales rose 27.95% to Rs 148.49 crore.

Japanese shares fell today, 26 July 2007, on decline in stocks of exporters such as Canon Inc. and Advantest Corp., although strong earnings reports lifted shares of Honda Motor Co. and Nintendo Co. Japan's Nikkei slipped 0.88% at 17,702.09, while Hang Seng declined 0.64% to 23,211.69.

China's main stock index reached a new high on opening today, 26 July 2007, on strong corporate earnings. The Shanghai Composite Index opened higher and hit 4,357.796, breaching the previous high of 4,335.96 set on 29 May 2007. It was up 0.52% to 4,346.51

European markets were trading slightly weaker today, 26 July 2007.

Wall Street rose yesterday, 25 July 2007, on some strong earnings and new deals, but not without a struggle, as mounting signs of a tougher lending climate again dogged investors. The Dow Jones Industrial Average gained 68.12 points, or 0.50%, to 13,785.07. Broader stock indicators also rose in shaky trading. The Standard & Poor's 500 index climbed 7.05 points, or 0.47%, to 1,518.09, and the Nasdaq Composite index advanced 8.31 points, or 0.31%, to 2,648.17.

Crude oil rose today, 26 July 2007, for the second day in New York after a report showed US oil inventories fell for a third week and gasoline demand was near a one-year high. Crude oil for September 2007 delivery gained as much as 50 cents, or 0.7%, to $76.38 in after-hours electronic trading on the New York Mercantile Exchange. It was at $76.17 in Singapore