Market Closing Session - 9th April

The market surged in late trade ending with decent gains shrugging off subdued to weak trend in Asian and European markets. It had edged lower at the onset of the trading session tracking subdued-to-weak trend in Asian markets before bouncing back shortly. Banking stocks surged in late trade after Yes Bank announced a forecast-beating profit and said it had no delinquent derivatives exposures. Fears that banks may take a hit in their balance sheet because of derivative losses have triggered a steep fall in banking shares over the past few weeks. Yes Bank results helped reduce the fear.

Concerns about corporate and bank earnings heightened after recent disclosures from ICICI Bank, Indias biggest private sector bank in terms of net profit and Larsen & Toubro, Indias biggest engineering & construction firm by revenue. On 4 March 2008, ICICI Bank said it had provided $70 million in Q3 December 2007 and may have to provide another $50 million in Q4 March 2008 for mark-to-market losses on investments. A few days later L&T said one of its subsidiaries L&T International FZE, may incur commodity-hedging-losses of as much as Rs 200 crore in the year ended March 2008.

The 30-share BSE Sensex jumped 202.89 points or 1.3% at 15,790.51. At the days high of 15,829.59, Sensex gained 241.97 points in late trade. At the days low of 15,464.72, Sensex lost 122.9 points in early trade.

The broader based S&P CNX Nifty was up 37.4 points or 0.79% at 4,747.05. Nifty April 2008 futures were at 4748, at a premium of 0.95 points as compared to spot closing of 4747.05.

As per provisional figures on NSE, foreign institutional investors (FII) sold shares worth Rs 307.27 crore today, 9 April 2008 and domestic funds bought shares worth Rs 475.81 crore.

Power stocks rose. Realty and IT stocks declined. Capital goods stocks rose on reports Finance Minister P Chidambaram met representatives from auto and capital goods industries to discuss industrial slowdown after recent weak Index of Industrial Production (IIP) numbers.

HDFC Bank and HDFC were major gainers from Sensex pack. The market breadth was strong. Buying was witnessed in select mid-cap and small-cap stocks.

Asian and European stocks edged lower after Washington Mutual Inc, the largest US savings and loan firm, said on Tuesday, 8 April 2008, it expected a large quarterly loss and minutes from the Federal Reserve's latest meeting showed some of the central bankers saw the possibility of a prolonged and severe US economic downturn.

The BSE clocked a turnover of Rs 5,294 crore today 9 April 2008 compared to a turnover of Rs 5,145.99 on 8 April 2008.

The NSE's futures & options (F&O) segment turnover was Rs 31,113.78 crore, which was lower than Rs 33,143.36 crore on Tuesday, 8 April 2008.

The market breadth was strong: on BSE 1829 shares advanced as compared to 810 that declined. 48 shares remained unchanged.

The BSE Mid-Cap index up 1.39% to Rs 6,471.51 and BSE Small-Cap index up 1.62% to 7,941.11.

BSE Bankex (up 3.01% to 8,192.26), BSE Power index (up 2.74% to 3,087.93), BSE Capital Goods index (up 2.66% to 12,862.47), BSE Metal index (up 1.73% to 13,778.96), BSE Consumer Durables index (up 1.47% to 3,983.84) outperformed Sensex.

BSE PSU index (up 1.05% to 7,316.32), BSE Oil & Gas index (up 1.03% to 10,571.03), BSE HealthCare index (up 0.71% to 3,963.87), BSE IT index (up 0.54% to 3,705.09), BSE Auto index (up 0.05% to 4,417.65), BSE FMCG index (down 0.48% to 2,361.20), BSE Realty index (down 1.59% to 7,292.76) underperformed Sensex.

Banking stocks surged in late trade after Yes Bank results hit the market in mid-afternoon trade. ICICI Bank (up 2.86% to Rs 836.50) and HDFC Bank (up 5.5% to Rs 1,376.05) edged higher. Yes Bank gained 4.65% to Rs 169.75 after posting 108.74% surge in net profit to Rs 64.50 crore in Q4 March 2008 over Q4 March 2007.

India's largest commercial bank State Bank of India rose 1.12% to Rs 1,693.50. It has reportedly shortlisted three potential partners, including Insurance Australia Group, for a general insurance venture. The other two shortlisted partners are a German firm and a US-based firm, the reports suggested.

Capital goods stocks rose. Larsen & Toubro (up 2.17% to Rs 2,637.30), Bharat Heavy Electricals (up 3.74% to Rs 1,776.75) and Suzlon Energy (up 4.45% to Rs 302.65) edged higher. As per reports, the finance ministry is looking at various measures to provide a boost to the capital goods sector, which witnessed a sharp slowdown in growth earlier this year. Finance Minister P Chidambaram today held a meeting with chief executives of several leading public sector and private companies in the sector including the likes of NPTC, Bhel, BEML and L&T among others. In January this year, the Index of Industrial Production (IIP) numbers showed a significant slowdown in the capital goods sector, with growth in the sector falling sharply from over 16% in December 2007, to just 2.1% in January 2008.

Power stocks rose. Reliance Power (up 3.1% to Rs 362.25), Reliance Energy (up 2.3% to Rs 1,176.90), NTPC (up 0.62% to Rs 187.70), Tata Power Company (up 4.84% to Rs 1,188.80) edged higher. The Finance Ministry has cleared a restructured Rs 50,000-crore accelerated power development and reforms programme (APDRP), which would soon be sent to the cabinet for approval.

IT majors declined. Tata Consultancy Services (down 0.98% to Rs 876.65), Wipro (down 0.56% to Rs 411.70) and Satyam Computer Services (down 0.37% to Rs 427.50) edged lower. However, Indias second largest IT exporter by sales Infosys rose 1.27% to Rs 1,479.90.

Realty stocks declined. Indiabulls Real Estate (down 3.33% to Rs 479.80), Housing Development Infrastructure (down 2.02% to Rs 639.50), Unitech (down 2.23% to Rs 263.35) and DLF (down 0.91% to Rs 610) edged lower.

India's biggest FMCG firm by sales Hindustan Unilever (HUL) declined 1.39% to Rs 244.45. It has reportedly cut prices of three of its soap brandsLux, Hamam and Rexona. The price reduction by HUL is being termed as a post-budget measure to please consumers, the reports added.

Indias largest private sector company in terms of market capitalisation and oil refiner Reliance Industries rose 1.55% to Rs 2,418.05.

Jaiprakash Associates (down 1.44% to Rs 218.35), ITC (down 1.2% to Rs 205.80), Ranbaxy Laboratories (down 1.78% to Rs 462.35), Reliance Communications (down 1.71% to Rs 492), Satyam Computer Services (down 1.67% to Rs 421.90), Maruti Suzuki India (down 1.65% to Rs 731.90), Bharti Airtel ( down 1.44% to Rs 816.65) edged lower from the Sensex pack.

HDFC (up 4.83% to Rs 2,421), Tata Steel (up 3.44% to Rs 678.90), Ambuja Cements (up 1.82% to Rs 120.20), Hindalco Industries (up 1.38% to Rs 172.65) and Cipla (up 2.42% to Rs 217.60) edged higher from Sensex pack.

Orchid Chemicals and Pharmaceuticlas clocked the highest volume of 2.53 crore shares on BSE. Sita Shree Food Products (1.95 crore shares), Ispat Industries (1.11 crore shares), Reliance Natural Resources (84.7 lakh shares) and Steel Authority of India (68.44 lakh shares) were other volume toppers in that order.

Orchid Chemicals and Pharmaceuticlas clocked the highest turnover of Rs 581.72 crore on BSE. Reliance Capital (Rs 260.93 crore), Reliance Industries (Rs 162.28 crore), Relaince Energy (Rs 154.61 crore) and Larsen & Toubro (Rs 147.13 crore) were other turnover toppers in that order.

The next major trigger for the market is Q4 March 2008 results of India Inc. Analysts will be closely watching what the company managements have to say about the outlook for the year ending March 2009 (FY 2009). Analysts will also scrutinize disclosures that companies may make regarding foreign exchange derivatives products that they have bought on the advice of their bankers. A steep decline in the value of the US dollar against the Japanese Yen and the Swiss Franc hit Indian corporates which have used these two currencies (Yen and Franc) extensively to swap their rupee denominated debt.

Good results are expected from the telecom sector on the back of strong growth in new subscribers additions. Infrastructure and engineering firms, too, are seen reporting decent numbers in Q4 March 2008 on the back of healthy order book positions. The performance of auto firms is likely to be sluggish due to muted volume growth and rise in input costs.

A depreciation of the rupee against the dollar is likely to drive good results from the IT sector on a sequential basis in Q4 March 2008 over Q3 December 2007, though the focus here is on guidance for the year ending March 2009 from IT bellwether Infosys Technologies. Infosys guidance will give investors a sense of the effect of the weakening US economy on technology spending by companies there. Infosys unveils Q4 results on Tuesday, 15 April 2008.

Prospects of further outflow by foreign funds to offset losses incurred by them in the US sub-prime mortgage market continue to weight on the market sentiment. In the calendar year so far, FIIs sold shares worth a net Rs 11808.70 crore (till 4 April 2008), to offset their huge losses in the US sub-prime mortgage market. As per provisional data, FIIs bought shares worth a net Rs 7.27 crore on Tuesday, 8 April 2008.

As far as domestic liquidity is concerned, inflows to equity mutual funds and unit linked insurance plans (with high weightage for equity) have slowed after the sharp setback on the bourses in the past two months. As per provisional data, domestic funds bought shares worth a net Rs 447.79 crore on Tuesday, 8 April 2008.

European markets were subdued. Frances CAC 40, Germanys DAX and UKs FTSE 100 were down between 0.31% to 0.78%. In Asia, key benchmark indices in Hong Kong, China, Japan, and Singapore were down by between 0.06% to 5.5%.

US stocks fell on Tuesday, after Washington Mutual Inc said it expects a large quarterly loss, raising concerns about results from the rest of the financial sector, while minutes from the Federal Reserve's latest meeting stoked fears of a recession. The Dow Jones industrial average lost 35.99 points, or 0.29%, finishing at 12,576.44. The Standard & Poor's 500 Index lost 7 points, or 0.51%, ending the day at 1,365.54. The Nasdaq Composite Index lost 16.07 points, or 0.68%, at 2,348.76.