Market Closing Session - Oct 26th

The market surged on renewed buying interest in index pivotals following healthy rollover of derivative positions from October 2007 to November 2007 on Thursday, 25 October 2007. Cash market turnover on BSE was just under Rs 9,000 crore. Global cues were mixed.

The Sensex surged 472.28 points or 2.52% at 19,243.17, an all-time closing high. It had opened marginally higher at 18,823.66 and slipped to low of 18,629.53 during the day. It hit an all-time high of 19,276.45 in late trade. At the day’s high of 19,276.45, Sensex had gained 505.56 points for the day.

Its previous all-time high was 19,198.66 struck on 18 October 2007.

The broader based S&P CNX Nifty jumped up 133.35 points or 2.39% at 5,702.30, a record closing high. Nifty hit an intra-day high of 5,716.90 during the day. Its all time high is at 5736.80, which it had struck on 18 October 2007. The Nifty November 2007 futures settled at 5716, a premium of 13.70 points as compared to spot closing

The market shrugged off concerns arising from possible FII sales after market regulator Securities & Exchange Board of India put restrictions on issue of participatory notes (PN) after trading hours on Thursday, 25 October 2007 and directed some exiting PN positions to be wound up within 18 months. The market regulator has put in place a set of regulations to clamp down excessive inflows through participatory notes (PN). The regulator affirmed that sub-accounts would not be allowed to issue PNs and that FIIs will have to unwind PNs with derivatives as underlying in 18 months. Sebi further allowed both regulated and unregulated pension funds, endowments, university funds and charitable trusts to register as FIIs.

PNs are issued by FIIs registered in India to unregistered overseas investors. Registered FIIs buy Indian securities and issue the notes based on the underlying asset.

While announcing rules to curb issue of participatory notes (PNs) by FIIs, the market regulator Securities & Exchange Board of India (Sebi) has also made it clear that PNs can now be issued only to foreign entities which are ‘regulated’ in their respective jurisdiction and not to those that are merely ‘registered’ in the jurisdiction as was the norm earlier. This will mean that many hedge funds that are not regulated in their home country will find it difficult to invest in the Indian market.

The Reserve Bank of India's (RBI) mid-term review of annual policy due on 30 October 2007 and US Federal Reserve’s meeting on 31 October 2007 on interest rates, will be key events that will drive the market in the near term.

The market breadth was strong on BSE: 1,706 scrips advanced as compared to 1037 that declined while 63 remained unchanged. 23 of the 30 members of the Sensex pack were trading with gains.

The BSE Mid-Cap index was up 2.19% to 7,920.66 while the BSE Small-Cap index gained 1.96% to 9,549.62. Both these indices underperformed the Sensex.

Most of the indices on BSE posted gains. Bankex (up 3.52% to 10,273.53), BSE Capital Goods Index (up 7.08% at 18,540.15), BSE PSU index (up 3.93% to 9,227.41), and BSE Oil and Gas Index (up 2.80% at 11,103.46), outperformed the Sensex.

BSE Realty (up 2.18% to 10,020.75), BSE Metal Index (up 1.95% at 16,744.56), BSE Consumer Durables index (up 0.62% to 5,234.25), BSE Auto Index (up 2.06% at 5,616.97), BSE FMCG Index (down 0.28% at 2,128.74), BSE Health Care Index (up 1.38% at 3,885.95), BSE IT Index (up 1.16% at 4,635.58), BSE TecK index (up 0.46% to 3,980.74), were underperformers.

The total turnover on BSE amounted to Rs 8968 crore as compared to Rs 8,456.76 crore yesterday, 25 October 2007.

The NSE F&O turnover was Rs 73836.74 crore as compared to Rs 103930.17 crore yesterday, 25 October 2007

India’s largest engineering and construction company Larsen & Toubro (L&T) galloped 12.40% to Rs 3885 on 11.55 lakh shares. It hit an all time high of Rs 3898 today. It was the top gainer from Sensex pack. L&T posted 72.95% rise in net profit to Rs 348.02 crore on 43.54% rise in total income to Rs 5,523.27 crore in Q2 September 2007 over Q2 September 2006. The company announced the results during the market hours today, 26 October 2007.

India’s largest bank in terms of net profit State Bank of India vaulted 7.53% to Rs 2091. It hit an all time high of Rs 2104.45. After market hours on 23 October 2007, SBI Life Insurance Company posted net profit of Rs 14.09 crore for the first half year ended 30 September 2007 on the back of 80% increase in its total premium collection. A 74:26 joint venture between the State Bank of India and Cardif, a BNP Paribas company, it manages assets over Rs 6000 crore.

Bharat Heavy Electricals (Bhel), the nation's largest power equipment maker in terms of sales soared 6.35% to Rs 2434.70 in anticipation of robust set of results from the company. It will announce its Q2 September 2007 results on 29 October 2007.

India’s largest power generation company by sales, NTPC advanced 2.38% to Rs 228.45. As per reports it is planing to acquire overseas coal blocks with a mining capacity of around 20 million tonnes per annum (mtpa).

Oil & Natural Gas Corporation (ONGC), the country’s largest oil exploration company by net sales advanced 4.12% to Rs 1159.95. As per reports, ONGC which reported gas discoveries on the east coast of India early this year, is planning to sell up to 60% stake in the block to Petrobras of Brazil and State Hydro of Norway.

Auto stocks gained on fresh buying. Tata Motors (up 1.98% to Rs 809), Mahindra & Mahindra (up 3.82% to Rs 802), and Maruti Suzuki India (up 1.38% to Rs 1175.10), were the other gainers from Sensex pack.

India's largest private sector entity by market capitalisation and oil refiner Reliance Industries (RIL) rebounded sharply from day’s low of Rs 2610 to hit a high of Rs 2710. It settled 2.42% higher at Rs 2691.10 on 13.52 lakh shares.

World’s sixth largest steel maker, Tata Steel pared gains from its 52-week high of Rs 1048.80 struck in early trade today. It ended with 0.62% gain to Rs 995. Tata Steel’s net profit rose 8.11% to Rs 1,190.83 crore on 11.41% rise in total income to Rs 4,879.41 crore in Q2 September 2007 over Q2 September 2006. The company announced the results during market hours today, 26 October 2007.

Shares of Bajaj Auto, the country’s second largest bike manufacturer by sales were up marginally by 0.30% to Rs 2503.05. TVS Motor Company jumped 4.32% to Rs 56.80. TVS has reportedly filed a Rs 250 crore defamation suit against Bajaj Auto in the Bombay High Court. This is in reaction to Bajaj's allegation that TVS had infringed the latter's patented DTSi (digital twin spark plug ignition) technology. TVS Motor Company gained 1.93% to Rs 55.30

Bharti Airtel, the country’s largest listed cellular services provider by total subscribers retraced sharply from day’s high of Rs 1044.90. It settled with a loss of 2.66% to Rs 992.80 on 3.77 lakh shares. It was the top loser from Sensex pack

India’s largest cigarette maker in terms of sales ITC slipped from day’s high of Rs 190.75. It closed 1.40% lower to Rs 180.30. It posted 13.42% rise in net profit to Rs 770.87 crore on 18.2% rise in total income to Rs 3,481.63 crore in Q2 September 2007 over Q2 September 2006. The results were announced during the market hours today, 26 October 2007.

Hindustan Unilever (down 1.34% to Rs 217.55), and Ranbaxy Laboratories (down 1.15% to Rs 424.80), were the other losers from Sensex pack

Among side counters, Electrosteel Castings (up 20% to Rs 60.35), Engineers India (up 20% to Rs 726.35), Hind National Glass (up 18.79% to Rs 900), Disa India (up 20% to Rs 1934.20), and OCL India (up 16.47% to Rs 274.75), surged

Tata Steel was the top traded counter on BSE with total turnover of Rs 457.63 crore followed by Larsen & Toubro (Rs 433.33 crore), Reliance Petroleum (Rs 404.76 crore), Reliance Industries (Rs 362.53 crore), and Reliance Natural Resources (Rs 272.20 crore), in that order

Bharat Forge jumped 6.67% to Rs 335.90 on posting 8.94% rise in net profit to Rs 67.74 crore on 25.23% rise in total income to Rs 588.48 crore in Q2 September 2007 over Q2 September 2006. The company announced the results during the market hours today, 26 October 2007.

Educomp Solutions lost 0.53% to Rs 3400. The company today said its net profit jumped 128.14% to Rs 13.62 crore on 63.41% increase in sales to Rs 44.94 crore in Q2 September 2007 over Q1 June 2007.

Kotak Mahindra Bank gained 5.93% to Rs 1,030.90 on reporting 116.6% rise in net profit to Rs 75.38 crore on 99.68% rise in total income to Rs 714.16 crore in Q2 September 2007 over Q2 September 2006. The company announced the results during the market hours today, 26 October 2007.

Deccan Chronicle Holdings eased sharply from day’s high of Rs 220. It closed lower by 0.22% to Rs 203.25 after its board approved a buyback of shares at a maximum price of Rs 250 per share. The board also agreed for private placement of up to 24% in subsidiary Sieger Solutions with a floor enterprise value of Rs 1500 crore and ceiling of Rs 1800 crore.

Idea Cellular slumped 8.55% to Rs 139 after it reported an average revenue per user (ARPU) of Rs 288 per month in Q2 September 2007, which was lower by Rs 32 from Rs 320 in Q1 June 2007. The decline in ARPU was due to lower minutes of use (MOU) and lower revenue per minute (RPM).

i-flex Solutions rose 2% to Rs 1582 on posting 31.58% rise in net profit to Rs 76.58 crore on 13.13%rise in sales to Rs 435.17 crore in Q2 September 2007 over Q1 June 2007. The company announced the results during the market hours today, 26 October 2007.

PTC India galloped 9.15% to Rs 115.70 on reports that private equity firms Goldman Sachs and Macquarie Bank are eyeing 40% stake in the investment arm of the company - PTC Financial Services (PFS). The deal is expected to be in the region of Rs 120 crore.

Sical Logistics soared 7.53% to Rs 247 after Reserve Bank of India allowed foreign institutional investors to buy up to 49% of the paid up capital of the company.

India Infoline spurted 11.51% to Rs 1107. It is reportedly looking at a Rs 200 crore private-equity funding for its recently started consumer finance subsidiary. The deal is expected to be concluded this quarter.

Jaiprakash Associates moved up 12.92% to Rs 1352.90. Recent reports suggest that the company, which is India’s biggest builder of dams, plans to combine its hydroelectric and coal-fired plants into a single company, giving it the flexibility to raise prices and meet demand.

India's wholesale price index rose 3.07% in 12 months to 13 October 2007, matching the previous week's rise which was the smallest in five years, government data released today afternoon showed. The annual inflation rate was 5.46% during the corresponding week of the previous year.

October 2007 derivatives contracts expired yesterday, 25 October 2007. Rollovers were healthy and in-line with the previous two months. As per market data, marketwide rollover of derivative positions from the October 2007 series to the November 2007 series was 84%, while the Nifty rollover was 71%.

Marketwide rollover of derivatives positions from September 2007 to October 2007 was 84% while that of August 2007 contracts to September 2007 contracts was 82.30%. Nifty rollover for September 2007 to October 2007 was 71% and that of August 2007 contracts to September 2007 was 70%.

European markets were trading mixed. Key benchmark indices in United Kingdom (up 0.18% to 6,588.10), and Germany (up 0.02% to 7,934.34) rose while France CAC 40 index slipped 0.09% to 5,755.74.

Asian markets were trading higher today, 26 October 2007. Hong Kong's Hang Seng (up 1.84% at 30,405.22), Japan's Nikkei (up 1.36% at 16,505.63), Taiwan's Taiwan Weighted (up 0.66% at 9,631.51), Straits Times (up 1.74% at 3,771.55) and South Korea's Seoul Composite (up 2.60% at 2,028.06) edged higher.

US markets ended slightly lower yesterday, 25 October 2007, as investors were uneasy about the credit markets and record-high oil prices and took little solace from reports on new home sales and durable goods orders. The Dow Jones Industrial Average slipped 3.33 points, or 0.02%, to 13,671.92. The Standard & Poor's 500 index lost 1.48 points, or 0.10%, to 1,514.40, while the Nasdaq Composite Index lost 23.90 points, or 0.86%, to 2,750.86.

Crude oil prices surged to all-time high of $91.10 a barrel in early trade on Friday, 26 October 2007 bolstered by supply concerns during the northern Hemisphere winter and growing political tensions in Middle East. NYMEX crude for December delivery which had hit a record high of $91.10 barrel, was up 31 cents at $90.77.

Source - Capital Markets