Bank stocks rise as SBI, ICICI Bank Q3 results cheer

The key benchmark indices logged decent gains on the back of good results from front-line banking firms and ahead of the Reserve Bank of India's monetary policy on Tuesday, 25 January 2011. But, index heavyweight Reliance Industries (RIL) declined on concerns about slow ramp up in gas production from the KG-D6 field due to technical and other issues. The BSE 30-share Sensex jumped 143.75 points or 0.76%, up close to 150 points from the day's low and off close to 40 points from the day's high. The market breadth was positive. Most European stocks were in the red. Asian stocks were mixed.



Interest rate sensitive realty stocks saw mixed trend ahead of the Reserve Bank of India's monetary policy on Tuesday, 25 January 2011. Software pivotals, too, were mixed.

The market pared gains after a positive start as index heavyweight Reliance Industries (RIL) declined. The market regained positive zone after slipping into the red for a brief period. The barometer index BSE Sensex regained the psychological 19,000 mark, soon after falling below that level for a short while. The market extended gains in mid-morning trade. The market pared gains in early afternoon trade after striking fresh intraday high. The market further pared gains in afternoon trade. The market moved in a range in mid-afternoon trade. The market firmed up in late trade.

The near-month January 2011 derivatives contracts expire on Thursday, 27 January 2011. The stock market remains closed on Wednesday, 26 January 2011 on account of Republic Day.

The results announced so far showed the combined net profit of 352 companies rose 22.1% to Rs 37374 crore on 20.1% rise in sales to Rs 305491 crore in Q3 December 2010 over Q3 December 2009.

The Reserve Bank of India (RBI) said in its Macroeconomic and Monetary Developments: Third Quarter Review 2010-11 that while downside risks to growth have receded, upside risks to inflation have increased. Since a lower inflation regime is essential for sustainable high growth, containing inflation becomes the dominant policy objective in the current environment, the RBI said.

With inflation remaining above Reserve Bank of India (RBI)'s comfort level, market men expect further increase in policy rates from the central bank in 2011. As per a poll by Capital Market, economists widely expect 25 basis points increase each in repo rate and reverse repo rate at a quarterly policy review tomorrow, 25 January 2011.

Revenue secretary Sunil Mitra said on Monday he expects tax-to-GDP ratio to be marginally lower at 10.6% in the current fiscal year to March 2011, from the budget estimate of 10.8% because of inflation.

European stock markets traded mostly lower on Monday, 24 January 2011, amid losses for the automotive and technology sectors, with Royal Philips Electronics dropping sharply after missing earnings expectations. The key benchmark indices in Germany and France were down by between 0.26% and 0.61%. But, UK's FTSE 100 index rose 0.22%.

Asian stocks were trading mixed on Monday, 24 January 2011, ahead of a Fed meeting this week where it is expected to paint a cautious view of the world's biggest economy. The key benchmark indices in Hong Kong, Indonesia, China, and Taiwan were down by between 0.26% to 0.99%. The key benchmark indices in South Korea, Singapore and Japan were up by between 0.04% to 69%.

The US Federal Reserve is likely to leave policy unchanged and note a slight improvement in the economy's outlook at the end of a two-day meeting on interest rates on Tuesday, 25 January 2011-Wednesday, 26 January 2011.

US stock markets closed mixed on Friday, 21 January 2011, despite positive fourth-quarter earnings reported by major companies such as eBay, Google and General Electric. The Dow Jones Industrial Average finished 49.04 points higher or 0.41% at 11,871.84, while the S&P 500 rose 3.09 per cent or 0.24% to 1283.35. But the Nasdaq Composite index dropped 14.75 points or 0.55% to 2689.54.

Trading in US index futures indicated that the Dow could rise 3 points at the opening bell on Monday, 24 January 2011. US index futures came off initial highs.

Back home, foreign institutional investors (FIIs) bought shares worth a net Rs 37.60 crore on Friday, 21 January 2011, as against an outflow of Rs 834.30 crore on Thursday, 20 January 2011. FII outflow in January 2011 totaled Rs 3446.60 crore (till 21 January 2011). FIIs had bought equities worth Rs 2049.60 crore in December 2010.

The BSE 30-share Sensex was up 143.75 points or 0.76% to 19,151.28. The index gained 186.93 points at the day's high of 19,194.46 in early afternoon trade. The index slipped 9.15 points at the day's low of 18,998.38 in early trade.

The S&P CNX Nifty was up 46.75 points or 0.82% at 5,743.25.

The market breadth, indicating the health of the market, was strong. On BSE, 1,701 shares advanced while 1,174 shares declined. A total of 103 shares remained unchanged.

Among the 30-member Sensex pack, 17 gained while the rest slipped.

The total turnover on BSE amounted to Rs 2894 crore, lower than Rs 3037.54 crore on Friday, 21 January 2011.

The BSE Mid-Cap index rose 0.84%. The BSE Small-Cap index gained 0.79%. Both these indices outperformed the Sensex.

Most of the sectoral indices on BSE were in the green. Banking sector index Bankex (up 2.4%), Consumer Durables index (up 1.93%), PSU index (up 1.2%), Capital Goods index (up 0.97%), Realty index (up 0.91%) and Auto index (up 0.84%) outperformed the Sensex.

The BSE Oil & Gas index (down 0.21%), Healthcare index (down 0.03%), FMCG index (up 0.12%), IT index (up 0.23%), Metal index (up 0.54%) and Power index (up 0.61%) underperformed the Sensex.

Banking shares saw an across the board rally on renewed buying after sector bellwether SBI posted strong Q3 earnings. India's largest bank by net profit and branch network State Bank of India (SBI) surged 3.66%, after reporting strong operating performance for the third quarter on Saturday, 22 January 2011. Net profit rose 14.1% to Rs 2828.06 crore on 43.3% growth in net interest income to Rs 9049.80 crore in Q3 December 2010 over Q3 December 2009.

On consolidated basis, net profit rose 12.2% to Rs 3710.48 crore on 14.7% growth in total income to Rs 36966.87 crore in Q3 December 2010 over Q3 December 2009.

India's largest private sector bank by net profit ICICI Bank rose 1.69% to Rs 1083.90, off the day's low of Rs 1060.60. Net profit jumped 30.51% to Rs 1437.02 crore on 8.78% rise in total income to Rs 8444.75 crore in Q3 December 2010 over Q3 December 2009. The result hit the market during trading hours today, 24 January 2011.

India's second largest private sector bank by net profit HDFC Bank rose 2.36%. The bank announces Q3 results on Thursday, 27 January 2011.

Index heavyweight Reliance Industries' (RIL) slipped 1.57% to Rs 971.05 after swinging between day's high of Rs 997.45 and low of Rs 965. Concerns about slow ramp up in gas production from the KG-D6 field weighed on the stock. Gross natural gas production from Reliance Industries' (RIL) KG-D6 block, off India's east coast, declined 5.7% to 55.8 million metric standard cubic metres per day (mmscmd) in Q3 December 2010 from Q2 September 2010, as the company continues to struggle to find solution to problems related to the reservoir.

RIL's net profit rose 28.14% to Rs 5136 crore on 5.15% rise in net turnover to Rs 59789 crore in Q3 December 2010 over Q3 December 2009. Higher refining and petrochemicals margins boosted the performance. RIL's gross refining margin (GRM) improved to $9 per barrel in Q3 December 2010 from $5.9 per barrel in Q3 December 2009. The GRM was also higher compared to $7.6 per barrel in Q2 September 2010. The result was announced after trading hours on Friday, 21 January 2011.

India's largest oil exploration firm ONGC gained 3.05% after the company after market hours on Friday, 21 January 2011, said that the oil leakage detected at its Mumbai Uran Trunk oil pipeline had stopped.

Software pivotals were mixed. India's third largest IT exporter by sales Wipro lost 2.57% and was the top loser from the Sensex pack. The stock extended Friday's over 4% triggered by resignations of the joint-CEOs of its information technology business. The resignations were announced at the time of announcing third quarter results before market hours on Friday, 21 January 2011.

Wipro's net profit as per International Financial Reporting Standards rose 10% to Rs 1319 crore on 12% increase in total revenue to Rs 7829 crore in Q3 December 2010 over Q3 December 2009.

India's largest software services exporter TCS fell 0.56% to Rs 1205.80 after striking a record high of Rs 1221 in intra-day trade today, 24 January 2011. On a consolidated basis, net profit rose 9.25% to Rs 2369.83 crore on 5.35% increase in total income to Rs 9857.56 crore in Q3 December 2010 over Q2 September 2010. The result was announced after trading hours on 17 January 2011.

India's second largest software services exporter Infosys rose 0.87% to Rs 3277.10, off day's low of Rs 3228.50. Consolidated net profit rose 2.5% to Rs 1,780 crore on 2.3% rise in revenues to Rs 7106 crore in Q3 December 2010 over Q2 September 2010 as per International Financial Reporting Standards. The result was announced before market hours on 13 January 2011.

Metal stocks rose as LMEX, a gauge of six metals traded on the London Metal Exchange rose 0.86% on Friday, 21 January 2011. Hindustan Zinc, JSW Steel and Sterlite Industries rose by between 0.34% to 2.35%.

India's largest private sector steel maker by sales Tata Steel rose 3.06%. The company's follow-on public offer (FPO) was subscribed 6.03 times. The issue ended on Friday, 21 January 2011.

Jindal Steel & Power rose 0.04% after consolidated net profit rose 8.77% to Rs 951.10 crore on 17.55% rise in total income to Rs 3182.70 crore in Q3 December 2010 over Q3 December 2009.

Steel Authority of India fell 1.19%. The company said during market hours today it has signed a memorandum of understanding (MoU) with IRCON International, a public sector undertaking (PSU) under the Ministry of Railways, for jointly working on rail infrastructure projects both in India and abroad.

Some consumer durables stocks edged higher. Rajesh Exports, Titan Industries and Blue Star rose by between 1.04% to 6.17%.

Telecom stocks fell. Reliance Communications and Bharti Airtel declined 0.82% and 1.07%, respectively.

Idea Cellular rose 1.02%. The company announced after market hours today that the consolidated net profit rose 35.2% to Rs 243 crore on 8.1% rise in total revenue to Rs 3955.60 crore in Q3 December 2010 over Q2 September 2010. The company said preparatory work for 3G rollout is on track, and company will in next few months launch 3G services in the 11 services areas where it won the 3G spectrum.

India's largest power equipment maker by sales Bhel rose 2.49%, extending Friday's gains triggered by good Q3 results. Net profit rose 30.82% to Rs 1403.23 crore on 24.63% rise in net sales to Rs 8849.27 crroe in Q3 December 2010 over Q3 December 2009. The result was announced during trading hours on Friday, 21 January 2011.

Auto stocks were mixed on worries higher interest rates and hike in vehicle prices could dent demand for vehicles. India's largest truck maker by sales Tata Motors was flat. India's leading tractor maker by sales Mahindra & Mahindra rose 2.22%. The company unveils its Q3 December 2010 results on 9 February 2011.

India's largest car maker by sales Maruti Suzuki India gained 2.96% on reports the company has hiked prices by up to Rs 8,000, except for its newly-launched compact car Alto K10, to combat rising input costs.

India's top bike maker by sales Hero Honda Motors fell 0.33%. The company informed the stock exchanges that Hero Honda Motors and Honda Motor Company, Japan on 22 January 2011 executed final binding licensing agreements with respect to existing products and new products following the memorandum of understanding of 16 December 2010, which had been approved by their respective boards. India's second largest motorcycle maker by sales Bajaj Auto shed 0.41%.

Shree Ashtavinayak Cine Vision clocked highest volume of 3.51 crore shares on BSE. Sanraa Media (Rs 1.07 crore shares), KSK Energy Ventures (86.45 lakh shares), SVC Resources (84.83 lakh shares) and C Mahendra Exports (63.89 lakh shares) were the other volume toppers in that order.

State Bank of India clocked highest turnover of Rs 196.29 crore on BSE. ICICI Bank (Rs 167.02 crore), KSK Energy Ventures (Rs 100.33 crore), LIC Housing Finance (Rs 98.45 lakh shares) and Reliance Industries (Rs 91.65 lakh shares) were the other turnover toppers in that order.