Market Closing Session - Nov 16th

Market swayed between gains and losses throughout the trading session. The highlight of today's trading was rally in a host of small-cap and mid-cap stocks. The market breadth was strong.

Banking and power stocks declined. Cement and consumer durables stocks were in demand. ITC surged. IT stocks recovered from day's lows. Hindalco Industries and Larsen & Toubro declined sharply in late trade.

The 30-share BSE Sensex ended down 86.53 points or 0.44% at 19,698.36. Sensex hit a high of 19,838.03 in afternoon trade. At day's high, Sensex had risen 53.14 points. Sensex had lost as much as 312.38 points in early trade to a low of 19,472.51.

The broader CNX S&P Nifty ended down 5.25 points or 0.09% at 5906.85.

India's wholesale price index rose 3.11% in the 12 months to 3 November 2007, above the previous week's rise of 2.97%, government data released today afternoon showed. The annual inflation rate was 5.45% during the corresponding week of the previous year.

The market had opened lower today extending Thursday (15 November 2007)’s losses on worries that credit losses from US mortgage defaults and slumping US home prices would grow worse, hurting US economy and US corporate profits. It had bounced back from lower level after initial sharp fall.

Chief Executive John Stumpf of Wells Fargo & Co, the No. 2 US mortgage lender, told a conference on Thursday, 15 November 2007, that the US housing slump was far from over and was the worst since the Great Depression. Stocks declined across Asia and Europe due to concerns about US economy.

The market has been volatile in recent sessions, caught between jitters about the US housing problems and optimism about India’s economic outlook.

BSE clocked a turnover of Rs 8854 crore compared to Thursday (15 November 2007)'s Rs 9,268.18 crore.

The NSE futures & options (F&O) turnover was at Rs 61505.32 crore compared to Thursday (15 November 2007)'s Rs 65894.61 crore.

The Nifty November 2007 futures were at 5906.00, a premium of 0.85 points over spot closing of 5906.85.

The market breadth was strong. On BSE, 1909 stocks advanced, while 912 stocks declined and 44 stocks were unchanged. 15 out of 30 stocks from the Sensex pack were in the red.

The BSE Mid-Cap index rose 1.17% to 8,512.38 and the BSE Small-Cap index rose 1.50% to 10,380.73. For the second day in a row, these two indices outperformed Sensex.

India’s largest private sector firm by market capitalisation and oil refiner Reliance Industries (RIL) moved up 0.14% to 2875.70.

India’s largest cigarette maker ITC jumped 8.17% to Rs 205.15. The stock has been rising ever since Citigroup came out with a buy rating on the stock recently, with a target price of Rs 215.

India’s top drug maker by market share Ranbaxy Laboratories declined 2.82% to Rs 411.70 after the drugmaker said it was recalling 600 mili gram (mg) and 800 mg tablets of its gabapentin drug from the US retail market.

Software stocks recovered after an initial decline. The BSE IT index fell 0.89% to 4,159.12, led by decline in Infosys Technologies. It underperformed the Sensex. Wipro rose 0.41% to Rs 458.30 and TCS moved up 0.34% to Rs 982.20.

Satyam Computers fell 0.07% to Rs 428.55, off sessions low of Rs 415.15 and Infosys Technologies declined 1.79% to Rs 1623.50, off sessions low of 1616. Indian IT firms rely on US market for more than 50% of their revenue. IT stocks had come under renewed selling pressure over the past few days due to concerns about the US economy.

The BSE Bankex fell 0.45% to 11,003.05. It underperformed the Sensex. ICICI Bank, India's largest private sector bank by assets, fell 2.33% to Rs 1219.45, off session's low of Rs 1201.25.

India’s largest commercial bank State bank of India moved up 0.76% to Rs 2325.60, off session’s low of Rs 2270. The stock recovered on hopes the government would soon approve its right issue. SBI, 59.73% owned by the government, said last month it was planning to raise Rs 18000 crore by selling new equity around the end of 2007. On Wednesday, 14 November 2007, Finance Minister P Chidambaram said there was a strong case for the rights issue.

India’s largest private sector bank by net profits HDFC Bank fell 0.71% to Rs 1687.15.

India's top mobile firm by market share Bharti Airtel moved up 1.28% to Rs 911.60 on reports that the company is not concerned about a drop in minutes of usage seen in the fiscal second quarter as new costumer additions are picking up well.

The BSE Metal index fell 1.36% to 17,498.20. It underperformed the Sensex. Hindalco Industries declined 5.42% to Rs 204, Tata Steel declined 2.02% to Rs 843.20 and Steel Authority of India (Sail) fell 1.50% to Rs 262.30. National Aluminium Company lost 2% to Rs 413.

Sterlite Industries moved up 1.14% to Rs 1019.20 and Sesa Goa gained 0.70% to Rs 3736.90.

Steel firm Essar Steel slumped 12.97% to Rs 51 after the company clarified that it has applied to BSE and NSE for delisting of the equity shares. The delisting price has been set at Rs 48.

The BSE Capital Goods index fell 1.25% to 20,643.71. It underperformed the Sensex. Larsen & Toubro slipped 2.88% to Rs 4375.85, Bharat Heavy Electricals (Bhel) fell 1.30% to Rs 2786.55 and BEML dropped 1.22% to Rs 1745.

Jaiprakash Associates gained 0.54% to Rs 1520.55 on reports that Formula 1 supremo Bernie Ecclestone has reportedly signed a 10-year contract with JPSK sports, a subsidiary Jaiprakash Associates to build the track in Greater Noida. He has expressed confidence that formula one sport would gain interest among sports enthusiast in India in coming years.

The BSE Power index fell 0.48% to 4,591.97. CESC slipped 4.15% to Rs 630.90, Areva T&D skid 2.57% to Rs 3037.25, NTPC dropped 1.89% to Rs 264.30, Reliance Energy fell 1.53% to Rs 1825.70 and Power Grid Corporation of India fell 0.67% to Rs 155.75.

Torrent Power rose 2.69% to Rs 198.30 and Tata Power moved up 0.53% to Rs 1252.15.

The BSE Consumer Goods index jumped 2.61% to 5,202.06 led by gains in Videocon Industries. It outperformed the Sensex. Videocon jumped 14.72% to Rs 402.10.

Titan Industries fell 0.25% to Rs 1517.25, Blue Star fell 0.58% to Rs 420.25, Asian star Company fell 2.115 to Rs 1290.30 and Lloyd Electric and Engineering dropped 3.31% to Rs 168.

Shares of the state-owned oil refineries and oil marketing companies rose on expectation of better gross refinery margins in the future. The BSE Oil & Gas index moved up 1.33% to 12,479.56. It outperformed the Sensex. HPCL moved up 5.55% to Rs 316.50, BPCL rose 1.79% to Rs 434.65, Indian Oil Corporation gained 3.72% to Rs 618.15, Bongaigaon Refinery rose 0.24% to Rs 105.20.

Investors expect that increased demand for refined petroleum products in short to medium term will push the gross refinery margins higher, which are already at high levels. Closures of certain refineries in other countries will benefit Indian companies who are increasing their capacities.

State-run oil refiner, Mangalore Refinery and Petrochemicals (MRPL) rose 1.91% to Rs 130.40. As per reports UK's British Petroleum (BP) and Japanese trading firms have shown an interest in buying the entire paraxylene output of an aromatic unit planned by the company.

Private sector refiner Essar Oil extended rally. It surged 22.01% to Rs 192.35. The stock appreciated 137.78% to Rs 157.65 in the last one week to 15 November 2007. The board of directors of the company will meet today, 16 November 2007 to consider further issue of securities to promoters.

India’s top oil explorer by market capitalization ONGC moved up 0.39% to Rs 1245.65.

Cement stocks were in demand. J K Cements soared 3.02% to Rs 197.75, Grasim Industries jumped 5.87% to Rs 3831.45, JK Lakshmi Cements gained 2.90% to Rs 191.70, and Ambuja Cements gained 0.20% to Rs 147.15. ACC fell 0.45% to Rs 1039.65.

Jindal Photo was locked at upper limit of 10% at Rs 269 after it said it plans to set up a 600 mega watt power project in the first phase in Orissa, to be expanded to over 1,000 megawatt in the second phase.

Phillips Carbon Black was up 2.23% to Rs 215.90 on reports that the company plans to invest Rs 500 crore over 16 months, to boost capacity by 60%.

Southern Online Bio Technologies was up 2.61% to Rs 53.15 after its board approved raising up to Rs 50 crore for a bio-diesel unit in Visakhapatnam.

Prajay Engineers Syndicate rose 0.97% to Rs 329.30 after the company said Prajay Holdings a 100% subsidiary of the company has received a commitment of foreign direct investment to the tune of $36 million.

Goldstone Technologies rose 0.60% to Rs 200.70 after the company said it has signed an agreement with two companies for distributing its Internet protocol television services in Malaysia and Thailand.

IndusInd Bank surged 2.83%to Rs 112.70 after the private sector bank said that it has entered into a tie-up with Cholamandalam MS, General Insurance Company for banc assurance.

Among side counters, Hinduja TMT surged 28.64% to Rs 556.10, Chambal Fertilisers and Chemicals soared 28.26% to Rs 72.40, MIRC Electronics jumped 16.10% to Rs 29.20, Escorts moved up 14.64% to Rs 142.10 and HTMT Global rose 10.84% to Rs 515.90.

Essar Oil clocked the highest turnover of Rs 635.52 crore on BSE. Reliance Petroleum (Rs 346.25 crore), Manglore Refinery and Petrochemicals (Rs 236.28 crore), Reliance Natural Resources (Rs 213.05 crore) and Nagarjuna Fertilisers and Chemicals (Rs 193.51 crore), were the other turnover toppers on BSE in that order.

Essar Oil registered highest volume of 3.37 crore shares on BSE. Nagarjuna Fertilisers and Chemicals (2.43 crore shares), Facor Steels (1.80 crore shares), Essar Steels (1.74 crore steels) and Manglore Refinery and Petrochemicals (1.73 crore shares), were the other volume toppers on BSE in that order.

Major European indices – UK’s FTSE 100, Germany’s DAX and France’s CAC 40 – were down by between 0.51% to 0.63%.

Asian stocks sank today, 16 November 2007, tracking overnight fall in US stocks. Key benchmark indices in Hong Kong, Japan, South Korea, Singapore and Taiwan were down by between 1.05% to 3.95%.

US stocks nose-dived on Thursday, 15 November 2007, as investors grappled with concerns about the strength of consumer spending and the overall economy after downbeat comments from Wells Fargo & Co. and J.C. Penney Co. The Dow Jones industrial average slid 120.96 points, or 0.91%, to finish at 13,110.05. The Standard & Poor's 500 Index dropped 19.43 points, or 1.32%, to close at 1,451.15. The Nasdaq Composite Index fell 25.81 points, or 0.98%, to 2,618.51.

US crude for December delivery settled down 66 cents, or 0.7%, at $93.43 a barrel on the New York Mercantile Exchange on Thursday. The catalyst for the drop in oil prices was data showing a surprising increase in US crude inventories in the latest week.

Meanwhile, as per media reports, private equity firm Blackstone Group, is said to have a huge pipeline of deals in India.

Massive FII inflow had send the market surging in September 2007 and October 2007. FII inflow was a robust in those two months - at Rs 16132.60 crore in September 2007 and Rs 20590.90 crore in October 2007. FII inflow had surged as huge liquidity infused by a steep 50 basis points cut in Fed funds rates in mid-September 2007 found its way into emerging markets.

Source - Capital Markets