BSE NSE Market Report 31 July 2009

BSE NSE Market Report 31 July 2009

The key benchmark indices surged for the second straight day as gains in Asian stocks, higher US index futures and better-than-expected Q1 June 2009 earnings of India Inc boosted sentiment. The BSE 30-share Sensex rose 282.35 points or 1.83%. The barometer index today struck its highest closing level in more than 13 months. Banking, oil & gas, IT and FMCG stocks rose. But realty stocks fell in volatile trade. The market breadth, indicating the overall health of the market weakened in the second half of the trading session compared to earlier strong breadth.

The Sensex is up 6023 points or 62.43% in calendar year 2009 as on 31 July 2009. From a 3-year closing low of 8,160.40 on 9 March 2009, the Sensex has risen 7,509.91 points or 92.02% as on 31 July 2009.

Coming back to today's trade, a bout of intraday volatility was witnessed. After surging in morning trade on firm Asian stocks, the market pared gains in early afternoon trade. The market firmed up again later. The market once again pared gains in mid-afternoon trade. The market surged in late trade on rally in RIL.

The Q1 June 2009 results announced so far have been encouraging, with lower costs helping bottomline growth. The combined net profit of 1921 companies rose 20.5% to Rs 71437 crore on 5.1% fall in sales to Rs 673497 crore in Q1 June 2009 over Q1 June 2008. The earnings season gets over today, 31 July 2009.

But a weak monsoon remains a cause of concern. India's monsoon rains were 18% below normal in the week to 29 July 2009, having been above normal in the preceding two weeks. Total rainfall since the beginning of June was 19% below average, the India Meteorological Department said on Thursday. On the flip side, water levels in India's 81 main reservoirs rose to 35% of capacity in the week to 30 July 2009, up from 23% a week earlier and 31% a year ago, government data showed. More than two-thirds of the people live in villages and 60% of the farm land depends on the annual rains.

Farm Minister Sharad Pawar on Friday, 31 July 2009, said that summer-sown crops such as sugarcane, oilseeds and cotton have covered more than half the normal area, and sowing is likely to rise. He also said weak monsoon rains would have a marginal impact on inflation.

World equity funds garnered $9.5 billion in the week ending 29 July 2009, according to data the latest data from global fund tracker EPFR Global. The inflow was the highest since June 2008.

Emerging markets continued to be the darling of investors, with dedicated BRIC (Brazil, Russia, India and China) equity funds seeing net inflows for a 19th straight week. India equity funds took in a year-to-date high of $211 million in the most recent week, while China and Greater China stock funds saw $711 million in fresh money.

European equities were flat after moving between gains and losses in intraday trade. Key benchmark indices in France and UK were up by between 0.01% to 0.09%. Germany's DAX fell 0.07%.

Asian stocks climbed today as better-than- expected earnings and a rally in commodities lifted confidence the global economy is headed towards recovery. Key benchmark indices in China, Hong Kong, Japan, South Korea, Singapore and Taiwan rose by between 0.72% to 2.72%.

Trading in the US index futures indicated Dow could rise 36 points at the opening bell today, 31 July 2009.

US markets rallied on Thursday, 30 July 2009, logging the highest close since November 2008, despite a late-afternoon pullback. It was the highest close for the Dow and S&P since November 2008, and for the Nasdaq, since October 2008.

The Dow Jones Industrial Average rose 83.74 points to close at 9154.46. The S&P jumped 1.2% to close near the 1,000 mark and the Nasdaq added 0.84% to finish near the 2,000 mark. In economic news, the number of US workers staying on jobless rolls fell to the lowest level in three months while the four week moving average for new claims dropped by 8250 to 559000, the lowest level since late January 2009.

The BSE 30-share Sensex was up 282.35 points or 1.83% to 15,670.31 its highest closing since 17 June 2008. The Sensex rose 344.85 points at the day's high of 15,732.81 in morning trade. The Sensex rose 61.51 points at the day's low of 15,449.47 in early trade.

The S&P CNX Nifty was up 65 points or 1.42% to 4,636.45 its highest closing since 11 June 2009. Nifty August 2009 futures were at 4636.05 at almost the same level as the spot closing of 4636.45.Turnover on NSE's futures & options (F&O) segment was Rs 57151.46 crore, much lower than Rs 94477.38 crore on Thursday, 30 July 2009.

BSE clocked a turnover of Rs 6,249 crore, higher than Rs 6,065.04 crore on Thursday, 30 July 2009.

The market breadth, indicating the overall health of the market, was positive. But the breadth weakened when compared to a strong breadth earlier in the day. On BSE, 1401 shares advanced as compared with 1,299 that declined. A total of 101 shares remained unchanged.

Among the 30-member Sensex pack, 23 rose while rest declined.

The BSE Mid-Cap index was up 1.17% and the BSE Small-Cap index was up 0.03%. Both these indices underperformed the Sensex.

The BSE FMCG index (up 3.17%), the BSE Oil & Gas index (up 2.65%), the BSE Bankex (up 1.92%), outperformed the Sensex.

The BSE Realty index (down 1.36%), the BSE Healthcare index (up 0.39%), the BSE Power index (up 0.47%), the BSE TECk index (up 0.49%), the BSE Capital Goods index (up 1.05%), the BSE PSU index (up 1.19%), the BSE Auto index (up 1.24%), the BSE Metal index (up 1.47%), the BSE Consumer Durables index (up 1.6%), the BSE IT index (up 1.81%), underperformed the Sensex.

India's largest private sector firm by market capitalisation and oil refiner Reliance Industries (RIL) rose 3.01% to Rs 1,957.10 on bargain hunting after a recent sharp fall. The Supreme Court on Thursday said, it will give a date on 1 September 2009 to expedite the decision pertaining to the Krishna-Godavari basin gas dispute between Mukesh Ambani's Reliance Industries (RIL) and Anil's Ambani's Reliance Natural Resources (RNRL). RNRL counsels Mukul Rohatgi and Mahesh Agrawal sought an early decision in the case.

RNRL chairman Anil Ambani has said the gas supply dispute between RIL and Reliance Natural Resources (RNRL) vitally affects public interest and will seek an early judgment in the case. The matter concerns power projects of national importance representing a capacity of 12,000 megawatt (MW) and an investment of over Rs 50,000 crore and affects the interests of over 10 million shareholders, he said.

The Supreme Court on 20 July 2009, asked the energy giant and former group firm Reliance Natural Resources (RNRL) why a gas pact between the two should not be cancelled. The court has scheduled next hearing on the dispute over the gas supply to Reliance Natural Resources (RNRL) on 1 September 2009.

RNRL has asked the Supreme Court to dismiss the government's affidavit on the dispute, even as the petroleum ministry has suggested that the court treats the pact between the two brothers null and void. The dispute concerns supply of natural gas from RIL's field, off the Andhra Pradesh coast, as also the price at which Reliance Natural Gas will get the fuel for power projects within the group.

In reply to the lawsuit filed by Reliance Industries challenging the Bombay High Court order, RNRL has said the government has no role to play in the private gas sharing dispute, and certainly not as a party to the row.

Oil exploration pivotals rose after US crude futures bounced back on Thursday, ending nearly 6.4% higher to reverse losses suffered in the previous session as Wall Street sizzled and the dollar edged lower. India's largest state-run oil exploration firm by sales ONGC rose 5.91%. Cairn India rose 1.33%. On the New York Mercantile Exchange, September crude settled up $3.59, or 5.67%, at $66.94 a barrel. Rise in crude oil prices would result in higher realizations from crude sales for oil exploration firms.

FMCG stocks rose on improvement in India's annual monsoon in July 2009 after a dry spell in June 2009. FMCG firms derive substantial revenue from rural sector. Britannia Industries, ITC, Dabur India, REI Agro, United Spirits, Tata Tea, rose by between 0.84% to 3.27%.

India's largest FMCG company by sales Hindustan Unilever rose 3.32%. The company reported a 2.68% fall in net profit to Rs 543.19 crore on a 5.06% increase in total income to Rs 4536.17 crore in Q1 June 2009 over Q1 June 2008. The results were declared during trade hours on Tuesday, 28 July 2009.

Bank stocks rose on strong Q1 results from State Bank of India, India's biggest commercial bank in terms of branch network. State Bank of India (SBI) rose 5.29% extending Thursday's 4.37% gains as its net profit jumped 42.02% to Rs 2330.37 crore on 29.86% rise in total income to Rs 21041.51 crore in Q1 June 2009 over Q1 June 2008. The results hit the market during trading hours on Thursday 30 July 2009.

India's second largest private sector bank in terms of operating income HDFC Bank rose 2.73% as its ADR rose 3.93% on Thursday. India's largest private sector bank in terms of operating income ICICI Bank rose 0.49% as its ADR rose 4.47% on Thursday.

Rate sensitive realty shares fell on profit taking after a recent rally. Investors are concerned that the central bank may start reversing its interest-rate cuts in early 2010 as food and energy prices fan inflation. Rising interest rates may dent property demand as most of the commercial and housing deals are driven by finance.

India's largest real estate developer by sales DLF fell 1.48% even as net profit surged 236.23% to Rs 100.40 crore on a 652.69% spurt in sales to Rs 417.97 crore in Q1 June 2009 over Q4 March 2009. The company announced the result after market hours on Thursday. 30 July 2009. Unitech, Indiabulls Real Estate, Phoenix Mills and Omaxe fell by between 1.35% to 3.57%.

India's largest mobile telecom player by sales Bharti Airtel fell 3.06% on reports the merger deal between Bharti Airtel and South Africa's MTN is likely to extended to September this year. The two companies could extend the exclusivity period for discussion by a few weeks. The original timeline for discussions expires on 31 July 2009. In the event of the deal going through, the Bharti-MTN combined entity will be the third-largest wireless group globally.

India's second largest mobile services provider by sales Reliance Communications fell 2.11%, reversing early gains, ahead of its Q1 June 2009 results. The consolidated net profit rose 8.3% to Rs 1637 crore in Q1 June 2009 over Q1 June 2008. The results were announced after market hours today.

IT stocks rose on better-than-expected Q1 June 2009 results by IT pivotals in the past few days. India's second largest IT exporter by sales Infosys rose 2.66% as its American depository receipt (ADR) rose 1.56% on Thursday. India's thirds largest IT exporter by sales Wipro rose 0.43% as its ADR rose 1.77% on Thursday. But India's largest IT exporter by sales TCS fell 0.68%.

Capital goods and construction stocks rose on government's thrust on infrastructure sector in Union Budget 2009-2010. Nagarjuna Construction Company, Hindustan Construction Company, Era Infra Engineering, Gayatri Projects and IVRCL Infrastructure & Projects rose by between 1.95% to 5%.

From capital goods space, Bharat Heavy Electricals, Larsen & Toubro, Punj Lloyd, ABB, BEML, Siemens rose by between 0.57% to 1.55%.

Some power stocks fell on profit taking even after a strong response to the Adani Power initial public offer (IPO) which opened for subscription on Tuesday, 28 July 2009. Reliance Power, Power Grid Corporation Of India, NTPC, CESC fell by between 0.47% to 3.24%.

By 16:00 IST on final day of the bidding today, 31 July 2009, the Adani Power IPO was subscribed 21.37 times.

Reliance Infrastructure rose 1.69% after net profit rose 25.35% to Rs 316.57 crore in Q1 June 2009 over Q1 June 2008. The company announced result after market hours on Thursday, 30 July 2009.

Tata Power Company rose 0.63% after its net profit rose 144.19% to Rs 396.97 crore in Q1 June 2009 over Q1 June 2008. The result hit the market at the fag end of the trading session

Auto stocks rose after posting strong Q1 June 2009 results in the past few days. India's largest truck market by sales Tata Motors rose 6.61%. The company on Tuesday, 28 July 2009, reported 57.54% rise in net profit to Rs 513.76 crore on a 7.17% decline in total income to Rs 6723.99 crore in Q1 June 2009 over Q1 June 2008.

India's largest tractor maker by sales Mahindra & Mahindra rose 0.56% extending Thursday's gains after net profit rose 151.63% to Rs 400.80 crore on 28.04 % rise in total income to Rs 426.61 crore in Q1 June 2009 over Q1 June 2008. The results for the current quarter include the figures of the erstwhile subsidiaries Mahindra Holdings and Finance and Punjab Tractors which were merged with the company. Hence, the figures of the current quarter are not comparable with those of the previous year's quarter. The results hit the market during trading hours on Thursday, 30 July 2009.

India's top small car maker by sales Maruti Suzuki India rose 1.11%.

But, India's largest bike maker by sales Hero Honda Motors fell 2.08%. The company posted 83% jump in net profit to Rs 500 crore on 34% rise in total revenue to Rs 3865 crore in Q1 June 2009 over Q1 June 2008. The company announced the Q1 result after market hours on Wednesday, 29 July 2009.

Metal stocks rose after LMEX, a gauge of six metals traded on the London Metal Exchange, rose 4.02% on Thursday, 30 July 2009.

India's largest private sector steel maker by sales Tata Steel rose 2.12%. The company's net profit fell 47% to Rs 789.83 crore on a 8.16% decline in total income to Rs 5661.89 crore in Q1 June 2009 over Q1 June 2008. The result was announced during trading hours on Wednesday, 29 July 2009.

But, India's second largest steel maker by sales Steel Authority of India fell 0.11%. Net profit fell 27.74% to Rs 1326.09 crore in Q1 June 2009 over Q1 June 2008. The company announced the result during trading hours on Thursday.

India's largest copper market by sales Sterlite Industries rose 2.91%. Net profit fell 68.5% to Rs 112.70 crore in Q1 June 2009 over Q1 June 2008. The result was announced during trading hours on Wednesday, 29 July 2009.

India's largest aluminum maker by sales Hindalco Industries rose 6.65% after the company reported lesser-than-expected 31% fall in net profit to Rs 480.56 crore in Q1 June 2009 over Q1 June 2008. The result hit the market in mid-afternoon trade.

India's second largest aluminum maker by sales National Aluminum Company rose 5.15% even as net profit fell 75.92% to Rs 126.45 crore in Q1 June 2009 over Q1 June 2008.

Sugar stocks fell on concerns sugar prices will fall on higher supplies after the government extended duty-free imports of both raw and refined sugar beyond 31 July 2009. Bajaj Hindusthan, Shree Renuka Sugars and Dhampur Sugars fell by between 0.89% to 3.88%.

Mahindra Satyam clocked highest volume of 1.73 crore shares on BSE. Unitech (1.65 crore shares), Suzlon Energy (1.62 crore shares), Ispat Industries (1.36 crore shares) and Cals Refineries (1.27 crore shares) were the other volume toppers in that order.

Reliance Industries clocked highest turnover of Rs 198.55 crore on BSE. State Bank of India (Rs 193.77 crore), Mahindra Satyam (Rs 181.9 crore), DLF (Rs 176.71 crore) and Aban Offshore (Rs 164.20 crore) were the other turnover toppers in that order.