Wednesday, May 28, 2008

Sensex garners 250 points as oil price declines sharply

The market, which moved between positive and negative zone in early trade, surged in the second half of the trading session led by rally in information technology and cement stocks. A sharp fall in crude oil prices and firm European markets also added to positive sentiments. However, capital goods stocks witnessed selling pressure.

The rally on the bourses gathered steam after the Finance Ministry said in afternoon trade, some media reports about new tax proposals to help ease mounting losses at state oil firms due to soaring crude prices were totally baseless. Media reports on Tuesday, 27 May 2008, had suggested that the government may levy a cess or surcharge on income tax and corporate tax to compensate it for losses due to any duty reduction on crude oil and motor fuels. The reports had weighed on the stock market that day.

The 30-share BSE Sensex rose 249.78 points or 1.53% at 16,525.37. The index climbed 287.71 points at day`s high of 16,563.30, hit at the fag end of trading session. The Sensex lost 57.81 points at the day`s low of 16,217.78, hit in early trade

The broader based S&P CNX Nifty was up 58.55 points or 1.20% at 4918.35. Nifty May 2008 futures were at 4934, a premium of 15.65 points against the spot closing.

The NSE`s futures & options (F&O) segment turnover was at Rs 56333.67 crore, higher than Rs 49968.5 crore on Monday, 26 May 2008. BSE clocked a turnover of Rs 5390 crore in the cash segment as against Rs 5,108.54 crore on Tuesday, 27 May 2008.

Oil prices dropped below $127 a barrel today, 28 May 2008, in Asia, extending a decline of more than $3 in the previous session on a growing sense that soaring prices have cut demand for gasoline and other fuel. Oil has been falling steadily every since it hit a record high $135.09 last week.

Expiry of May 2008 futures & options series on Thursday, 29 May 2008 kept the market volatile. As per reports, rollover of Nifty positions from May 2008 series to June 2008 series stood at 45.63% as on 27 May 2008. Rollover of individual stock futures has been lacklustre so far.

Asian markets were mixed today, 28 May 2008. Key indices in Hong Kong, Japan, South Korea and Taiwan were down by 0.13% to 1.32%. However, China`s Shanghai Composite (up 2.48%), and Singapore`s Straits Times (up 0.56%), rose.

European markets, which opened after Indian market, were trading higher. Key indices in France, Germany and UK were up by 0.43% to 1.51%. US markets advanced yesterday, 28 May 2008, led by technology companies and further drop in crude oil prices. The Dow Jones industrial average advanced 68.72 points, or 0.55%, to 12,548.35. The S&P 500 index gained 9.42 points, or 0.68%, to 1,385.35, and the Nasdaq Composite index surged 36.57 points, or 1.50%, to 2,481.24.

Back home, the market breadth was even on BSE with 1312 shares advancing as compared to 1358 stocks that declined. 86 stocks remained unchanged.

The BSE Mid-Cap index rose 1.12% to 6,753.53 and BSE Small-Cap index rose 0.33% to 8,237.09. Both the indices underperformed the Sensex.

India`s biggest cigarette maker by sales ITC rose 6.19% at Rs 222.05. Foreign brokerage firm Credit Suisse raised its target price on ITC to Rs 264, saying on Tuesday, 27 May 2008, the firm was well positioned to grow in a general slowdown.

Cement stocks were in demand after the Union government partially lifted a ban on cement exports. Ambuja Cements (up 6.66% at Rs 104.10), Ultratech Cements (up 3.04% at Rs 655.20), ACC (up 2% at Rs 668.65), India Cements (up 3.67% at Rs 162.55) and Grasim Industries (up 1.74% at Rs 2237.70), jumped.

India`s largest private sector firm by market capitalisation and oil refiner Reliance Industries rose 1.15% to Rs 2521.80.

India`s biggest commercial vehicles maker by sales Tata Motors advanced 1.30% to Rs 634.75 after the company reported 6.03% rise in net profit to Rs 2028.92 crore on 5.40% rise in total income to Rs 29214 crore in the year ended March 2008 over the year ended March 2007.

The BSE IT index outperformed the Sensex, rising 2.61% at 4,566.42. Mphasis (up 10.02% at Rs 250.85), TCS (up 4.46% at Rs 1,009.70), Satyam Computer (up 3.09% at Rs 514.40), Wipro (up 2.96% at Rs 506.15) and Infosys Technologies (up 1.82% at Rs 1,912.65), soared.

The BSE Bankex outperformed the Sensex, rising 2.31% at 7,933.50. Axis Bank (up 9.51% at Rs 810.80), Kotak Mahindra Bank (up 5.94% at Rs 705.65), State Bank of India (up 3.12% at Rs 1,519.30), and HDFC Bank (up 1.52% at Rs 1,351.60), spurted.

India`s largest private sector bank by assets ICICI Bank rose 0.94% at Rs 820.20.

The BSE Capital Goods index underperformed the Sensex, falling 1.66% to 12,571.91. Bharat Heavy Electricals (down 2.78% at Rs 1,612.15), Bharat Electronics (down 2.05% at Rs 1,134.50), Siemens (down 1.13% at Rs 575.75), and Thermax (down 0.84% at Rs 434.60), slipped.

India`s largest engineering and construction firm by revenue Larsen & Toubro fell 1.25% at Rs 2,709.10. The will declare its March 2008 ended quarter results on Thursday, 29 May 2008.

Among the side counters, Crompton Greaves (down 6.07% at Rs 229.65), Sun TV Network (down 4.03% at Rs 312.20), Cairn India (down 3.54% at Rs 287.80), and Nagarjuna Construction Company (down 3.12% at Rs 186.35), declined.

Chambal Fertilisers & Chemicals clocked the highest turnover of Rs 291.49 crore on BSE. Bajaj Finserve (Rs 235.93 crore), Reliance Industries (Rs 190.18 crore), Reliance Capital (Rs 165.28 crore) and Reliance Power (Rs 131.39 crore), were the other turnover toppers on BSE in that order.

Chambal Fertilisers & Chemicals reported highest volume of 3.48 crore shares on BSE. Nagarjuna Fertilizers and Chemicals (1.86 crore shares), Ispat Industries (1.35 crore shares), IFCI (1.23 crore shares) and Spice Communications (1.14 crore shares), were the other volume toppers on BSE in that order.

State-run power utility Neyveli Lignite Corporation jumped 5.07% to Rs 146 after reporting 1357.10% surge in net profit to Rs 384.68 crore on 128.9% jump in net sales to Rs 801.74 crore in Q4 March 2008 over Q4 March 2007.

Auto component maker Minda Industries jumped 5% at Rs 309.75 after the firm said it bagged orders worth Rs 50 crore from Volkswagen to supply headlamps and rear combination lamps for its upcoming models.

Software developer Compucom Software rose 4.87% tos 32.30 on bagging an order worth Rs 142 crore from the secondary education department, Government of Rajasthan for executing ICT project in 2292 government schools in the state.

Cargo handler Gati advanced 2.36% to Rs 99.95 after foreign brokerage Goldman Sachs initiated coverage on the stock with a ‘buy` recommendation with price target of Rs 149.

Visa Steel gained 1.86% to Rs 60.15 on reporting 3129% surge in net profit to Rs 20.99 crore on 78% increase in total income to Rs 259.66 crore in Q4 March 2008 over Q4 March 2007.

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