Tuesday, March 30, 2010

Profit Booking drags Indian Stock Markets 30 March 2010

Indian markets snapped a four-day winning streak on Tuesday after the NSE Nifty slipped 40 points to end below the 5300 mark. Profit booking was seen in IT heavyweights like Infosys, TCS and Wipro as the rupee continued to appreciate hitting its 52-week high of Rs44.88 against the US dollar. The Oil & Gas major Reliance Industries, a pillar in the recent rally, which took the main indices to 52-week highs, also witnessed some offloading towards the end. In addition, banking heavyweights HDFC Bank and SBI were among the other major laggards.

Till Monday, the situation appeared to be quite under control with the NSE Nifty and BSE Sensex closing at 52-week highs. Bulls succumbed to supply pressure as technically stocks looked to be in an overbought zone. What was surprising was that, market breadth for the first time ended in favour of the bulls, out of total 2883 stocks on the BSE, 1,690 advanced against 1,099 declines while 94 stocks remained unchanged.

Finally, the BSE Sensex slipped 121 points to end at 17,590 and NSE Nifty lost 40 points to close at 5,262.

In Asia, the Nikkei in Japan ended higher by 1%, Australia's S&P/ASX also ended higher by 0.4%. Shanghai SE Composite rose 0.2% and Hang Seng index in Hong Kong was up 0.7%.

In Europe, stocks were trading flat. The DAX in Germany was flat, the CAC 40 index in France was up 0.2% and the FTSE in the UK was flat.

Tata Motors, Hitachi Construction Machinery Co. Ltd. (Hitachi) and Telco Construction Equipment Company Limited (Telcon), a 60:40 joint venture company between Tata Motors and Hitachi, signed an agreement under which Tata Motors has sold a further 20% stake in Telcon in favour of Hitachi for a consideration of Rs11.59bn.

Consequently Telcon will be owned 60% by Hitachi and 40% by Tata Motors.
Standard Chartered Bank and AZB Partners acted as Financial and Legal Advisors respectively for the company to this transaction.

Shares of Tata Motors ended higher by 2.2% at Rs756. The scrip opened at Rs746 it touched an intra-day high of Rs760 and a low of Rs742 and recorded volumes of over 0.73mn shares on BSE.

Shares of LIC Housing Finance fell by 2.8% to Rs861 after the company clarified that it has not made any application to the Reserve Bank of India (RBI) for a banking licence. The appropriate decision in this regard will be taken only after the RBI notifies the guidelines for issuing banking licence, LIC Housing said. LIC Housing said that it does not know the source of a newspaper report stating that the company may get a banking licence from the RBI.

Shares of Hero Honda slipped by 2% to end at Rs1966. The company declared a Silver Jubilee Special Dividend @ 4000% i.e. Rs80/- per equity share of Rs2/- each.

Daiichi Sankyo is reportedly planning to delist Ranbaxy Labs from the Indian stock exchanges in 4 months. Shares of Ranbaxy shot up to an intra-day high of Rs490 post the news. However, it finally settled at Rs476 losing 1%.

According to reports, Daiichi Sankyo which owns 64% of Ranbaxy is finalizing the modalities for the delisting as it may help the Daiichi to fully integrate the Indian drugmaker with itself.

However, Daiichi Sankyo has denied reports that it will delist Ranbaxy in the next 4 months. Ranbaxy will remain listed in India, said Michiko Igarashi, a spokeswoman for Daiichi Sankyo.

Shares of Supreme Infrastructure advanced by over 1.4% to end at Rs180 after it bagged new order worth Rs442.2mn from Executive Engineer, Construction Division No. 2, PWD B & R Br of Kapurthala for Construction of Judicial Court Complex at Kapurthala over a span of 24 months.

Shares of Pyramid Saimira were locked at 10% upper circuit to end at Rs15.45 after the company announced that the board of directors of the company has approved to sell its film exhibition operations and also Company’s investments in the subsidiaries.

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