Markets continued the volatile behaviour of yesterday into today's trade as well, as traders remained unsure of the short term direction. While economic data and global cues are positive, the doubts about sustained corporate performance are worrying many.
The possibility of liquidity drying up is also weighing in on the markets. Though FII's have pumped in money all through June and first week of July, the possibility of a slowdown and maybe even some selling is not ruled out.
Despite the firm closing by the US markets yesterday and positive opening by most other Asian markets, markets saw a sharp decline immediately after a positive opening. The indices bounced back within minutes and drifted sideways for half an hour before starting their descent again.
After the initial decline the indices turned volatile, making regular attempts to recover lost ground, only to decline again. Weakness in ONGC, Reliance and the tech stocks kept the markets down.
A sharp surge in Reliance late in the afternoon helped the indices to recover most of their early losses as some of the other losers also recovered partly. Rally in ITC also helped the indices. The last half hour saw more selling emerge in technology stocks and the markets slumped again to the day's lows.
Sensex closed at 7188, a loss of 60 points, and the Nifty at 2185, a loss of 19 points. Nifty July futures discount to the spot index widened to 14 points from yesterday's 11 points.
IPCL, Tata Chemicals and Shipping Corporation were among the major gainers among Nifty stocks while VSNL, Zee Tele and MTNL were the major losers.
Helped by earnings upgrades from IBM and HP as well as the decline in crude prices, US markets closed on a positive note yesterday. The Dow gained close to half a per cent while S&P 500 closed almost flat. NASDAQ closed with very marginal gains.
Crude declined a per cent yesterday to close marginally above the $60 mark. NYMEX crude futures for August delivery declined after US weekly inventory data showed an increase in crude stocks.
Among the Indian technology ADR's, Satyam and Wipro managed to recover part of the losses from the previous day. Infosys lost another 2 per cent, taking the total decline over the last 2 days to 9 per cent. HDFC Bank, ICICI Bank, Dr. Reddy's, Tata Motors and VSNL all closed with losses yesterday. MTNL managed to close a per cent higher.
Cement major ACC would invest up to Rs600 crore during the current year to raise capacity. After the expansion, the company's total capacity would increase by over 2 million tonnes to 20.6 million tonnes per annum. ACC had reported a volume growth of 13 per cent during the first quarter of the current year and the company is confident that the growth momentum would sustain.
There is also speculation that European cement major Holcim may raise its stake in ACC to 51 per cent. Currently, Holcim holds a 35 per cent stake indirectly through Ambuja Cements. Gujarat Ambuja Cements holds a 33 per cent stake in Ambuja Cements and the rest is held by Holcim. ACC closed with gains of under a per cent.
After the acquisition of safety match manufacturer Wimco, ITC Limited is reportedly eyeing more acquisitions. According to media reports, the company is the front runner to acquire Karnataka state PSU Mysore Paper Mills. The loss making paper company had posted a turnover of over Rs350 crore last year and would help ITC consolidate its position in the paper board business.
ITC is also believed to be in talks to acquire greeting cards and gifts retailer Archies. Being the only organised player in this segment, Archies could help ITC expand its paper stationary and greeting cards operations. ITC has denied that it is in talks to buy these two companies. The stock closed well over a per cent higher.
ONGC has floated a subsidiary to set up a 750 MW gas based power plant in the north eastern state of Tripura. The company is in talks with Power Trading Corporation for selling the electricity generated by the plant. Power Trading Corporation may take a minority stake in the venture at a later date.
The oil ministry has reportedly asked ONGC to pay Rs2,870 crore towards subsidy costs of oil marketing companies for the first quarter of the current fiscal. At this rate, the total burden on ONGC for the full year would exceed Rs10,000 crore if crude prices do not see a substantial decline. The stock closed lower.
After losing out in the race to acquire a Finnish tractor manufacturer last year, Mahindra & Mahindra is believed to be close to acquiring a tractor manufacturer in Romania. M&M is one of the only two short listed bidders for the Romanian company with a capacity of 15,000 units per annum.
The acquisition, if it comes through, would help M&M establish its presence in the East European and Russian markets. The company had recently started commercial production at its Chinese venture and has the stated aim of becoming the single largest tractor manufacturer globally in the next few years. The stock closed with marginal gains.
HDFC Bank, often called the 30 per cent bank by analysts for the regularity with which it reports over 30 per cent growth in quarterly profits, did not disappoint this time either. For the first quarter the bank reported a profit growth of 31 per cent as total revenues rose over 40 per cent as compared to the previous year.
Profit growth was lower as provisions for the quarter were higher by almost Rs100 crore. The stock price witnessed considerable volatility during the day as the results were announced. After declining immediately following the announcement, the stock recovered later and rallied to close with gains of under 2 per cent.
Infosys Consulting, the consulting arm of Infosys, has netted 25 large clients in the first year of operation. The division is planning an aggressive expansion by recruiting 500 consultants and investing $20 million over the next 2 years. It has around 100 consultants in the US at present.
VSNL, which had seen substantial appreciation over the last 2 weeks, came crashing down today and closed with losses of close to 8 per cent. The stock had appreciated on rumours of a domestic acquisition, despite denials from the company.
Among other telecom stocks, MTNL lost over 5 per cent while Bharti closed with marginal losses.
Another high flier of recent days which saw substantial correction today was ICICI Bank. The stock which had posted life time highs for consecutive days earlier this week, gave up 4 per cent.
Technology stocks were among the most significant losers today as traders turned highly sceptical about the results from TCS, Satyam and Wipro due shortly. TCS closed with losses of close to 4 per cent and Infosys lost well over 3 per,cent. Wipro lost close to 2 per cent while Satyam lost a per cent.
Zee Tele, which had spurted yesterday on rumours of a DTH joint venture with Anil Ambani group, lost over 5 per cent today. The company had denied the rumours after market hours yesterday.
The larger PSU bank stocks had a weak session with both SBI and PNB closing with losses of around 2 per cent each.
Among auto stocks, Hero Honda and Tata Motors were among the major losers. Maruti and Bajaj Auto closed with losses of under a per cent each.
Most oil stocks continued to remain weak ahead of the government decision on sharing of subsidies expected tomorrow. ONGC, BPCL and HPCL all closed with losses. Indian Oil managed to close higher.
Metal stocks had a mixed day as Tata Steel closed with losses of well over a per cent while SAIL managed a positive closing. Among aluminium stocks, Nalco closed with gains of close to 2 per cent while Hindalco closed lower.
Neyveli Lignite's first quarter profits doubled as compared to the previous year on a revenue growth of 30 per cent.
Dabur declined over 4 per cent after the company denied rumours that it is in negotiations to acquire pain balm and cold rub manufacturer Amrutanjan.
Mid-caps were not much affected by the volatility in frontline stocks today as well. Though the index closed the day with losses, the decline was much less than the frontline indices. The CNX Mid-Cap 200 index closed at 3206, a loss of 12 points, after scaling a new lifetime high in the morning.
ITI Limited has received an order for GSM network equipment from BSNL. The order is for 4 million mobile telephone lines and is worth over Rs1,200 crore. ITI makes equipment in collaboration with Alcatel of France. The stock closed 16 per cent higher.
BSNL is also in the process of inviting tenders for a large order reportedly worth $3 billion. ITI had recently ventured into mobile handset manufacturing again in association with Alcatel. The stock had gained over 15 per cent yesterday.
According to media reports, Bata India is planning to shift its corporate office from Kolkata to Gurgaon, near Delhi. The company has reportedly formed a joint venture with a prominent Kolkata based real estate developer to build a township on the land that will become free after the shifting.
Pharma company Glenmark is reportedly in negotiations to license its anti-asthma drug for the European markets. The deal is expected to be worth over $130 million in license fee over the next few years. The company had entered into separate licensing agreements for the Japanese and US markets for the same drug earlier.
UTI Bank reported a 31 per cent growth in first quarter profits on revenue growth of close to 35 per cent as compared to the previous year. The stock closed 2 per cent lower.
Hexaware Technologies crashed over 10 per cent in early trades after the company revised its annual revenue guidance downwards. The company expects full year revenues for the period ending Dec 05 to be $153 million as against the earlier estimate of $170 million. The stock closed 13 per cent lower.
Greeting cards company Archies opened the day more than 10 per cent higher on reports of a possible acquisition by ITC. The stock remained form despite denials from the company. The stock closed 5 per cent higher.
Dhanalakshmi Bank, Rallis India and Bharti Shipyard were among the best performing stocks among mid-caps.
Titan Industries, Elgitread and Adlabs Films were among the significant mid-cap losers.
*Disclaimer: The author does not have any position in the stocks specifically mentioned above at the time of writing this article. This analysis / report is only for the purpose of information and is not an investment advice. Readers are advised to consult a certified financial advisor before taking any investment decisions. While efforts have been made to ensure the accuracy of the information provided in the content the author or publisher shall not be held responsible for any loss caused to any person whatsoever.
Gain (+) / Loss (-)
Last Update : 14 July, 2005, 16:13 PM
|7,187.70 ||- 60.21 |
|NIFTY ||2,185.10 ||- 18.95 |
Figures in Rupees
Last Update : 14 July, 2005, 16:02PM
|Scrip Name ||Open ||High ||Low ||Last Price|
|BHEL ||871.05 ||898.90 ||865.10 ||898.00|
|I T C LTD ||1,720.00 ||1,794.00 ||1,651.00 ||1,766.40|
|RELIANCE* ||631.25 ||647.00 ||621.60 ||642.10|
|NTPC LTD ||90.50 ||91.60 ||89.00 ||91.10|
|RANBAXY LABORATORIES LTD. ||1,029.95 ||1,043.00 ||1,020.15 ||1,029.15|
|CIPLA LTD. ||322.00 ||328.30 ||321.10 ||325.15|
|ASSOCIATED CEMENT COMPANIES LT ||425.00 ||432.00 ||420.00 ||424.50|
|GRASIM INDUSTRIES LTD. ||1,080.00 ||1,089.50 ||1,066.20 ||1,076.95|
|RELIANCE ENR ||628.75 ||629.70 ||616.15 ||621.40|
|HINDALCO IN ||1,231.45 ||1,245.90 ||1,225.05 ||1,233.20|
|HDFC BANK LT ||643.00 ||655.00 ||629.90 ||644.55|
|ICICI BANK L ||455.25 ||460.00 ||442.50 ||445.95|
|TCS LTD ||1,279.00 ||1,281.00 ||1,219.10 ||1,224.55|
|INFOSYS TECHNOLOGIES LTD.-ORDI ||2,205.00 ||2,225.00 ||2,122.10 ||2,133.75|
|HEROHONDA M ||642.00 ||644.35 ||618.00 ||620.85|
|GUJARAT AMBUJA CEMENTS LTD. ||62.00 ||62.50 ||60.40 ||60.75|
|STATE BANK OF INDIA ||722.50 ||731.90 ||709.00 ||711.65|
|LARSEN & TOUBRO LTD. ||1,270.00 ||1,270.00 ||1,230.35 ||1,238.10|
|WIPRO LTD. ||710.00 ||715.00 ||695.00 ||696.00|
|DR.REDDY'S LABORATORIES LTD. ||759.75 ||760.00 ||735.00 ||738.55|
|SATYAM COMP ||485.90 ||492.45 ||474.40 ||477.30|
|TATA POWER ||411.80 ||417.00 ||400.30 ||402.25|
|TATA IRON AND STEEL CO. LTD. ||360.00 ||360.00 ||349.90 ||350.35|
|TATA MOTORS ||460.50 ||465.90 ||453.00 ||455.20|
|HOUSING DEVELOPMENT FINANCE CO ||890.00 ||899.90 ||875.00 ||880.00|
|HINDUSTAN LEVER LTD. ||158.50 ||158.50 ||155.00 ||155.35|
|BHARTI TELE ||253.50 ||257.00 ||251.55 ||252.55|
|BAJAJ AUTO ||1,395.00 ||1,395.00 ||1,360.10 ||1,383.00|
|ONG CORP LTD ||924.00 ||927.50 ||906.70 ||921.75|
|MARUTI UDYOG ||450.00 ||454.90 ||447.50 ||449.30|
S&P CNX Nifty
Last Update : 14 July, 2005, 16:00PM
|Symbol ||Open ||High ||Low ||Last Price|
|RELIANCE ||631.65 ||646.85 ||621.10 ||641.50|
|INFOSYSTCH ||2215.00 ||2222.40 ||2125.20 ||2135.85|
|VSNL ||346.00 ||346.25 ||314.65 ||316.85|
|SATYAMCOMP ||489.00 ||495.00 ||476.20 ||478.70|
|IPCL ||178.00 ||186.20 ||178.00 ||184.95|
|TCS ||1278.65 ||1287.70 ||1216.35 ||1225.00|
|ONGC ||923.00 ||927.95 ||906.05 ||921.95|
|SBIN ||727.00 ||731.80 ||710.00 ||712.50|
|ITC ||1728.00 ||1793.70 ||1725.00 ||1764.95|
|TATACHEM ||183.80 ||191.70 ||183.00 ||187.45|
|ACC ||423.70 ||440.00 ||420.10 ||424.95|
|TISCO ||355.95 ||357.10 ||350.00 ||350.60|
|TATAMOTORS ||459.95 ||465.95 ||453.30 ||455.50|
|HDFCBANK ||642.85 ||655.00 ||629.00 ||645.20|
|MTNL ||137.80 ||139.40 ||129.65 ||130.65|
|ZEETELE ||176.00 ||178.90 ||165.05 ||166.95|
|HINDLEVER ||157.00 ||158.45 ||155.15 ||155.65|
|MARUTI ||450.60 ||455.00 ||448.00 ||449.65|
|WIPRO ||710.00 ||715.00 ||695.00 ||696.25|
|REL ||621.00 ||629.85 ||615.20 ||622.65|
|DABUR ||151.50 ||162.00 ||138.35 ||139.50|
|RANBAXY ||1029.90 ||1044.00 ||1022.00 ||1030.15|
|BAJAJAUTO ||1390.00 ||1394.45 ||1360.00 ||1370.60|
|GAIL ||213.50 ||214.40 ||208.00 ||208.70|
|PNB ||401.00 ||404.50 ||391.00 ||392.00|
|HEROHONDA ||630.00 ||635.00 ||618.00 ||620.55|
|TATAPOWER ||411.00 ||416.75 ||404.55 ||405.15|
|LT ||1264.00 ||1264.00 ||1235.00 ||1239.50|
|HDFC ||893.00 ||898.90 ||875.00 ||878.20|
|ICICIBANK ||459.00 ||460.00 ||444.00 ||446.00|
|HINDPETRO ||296.00 ||301.40 ||290.15 ||294.85|
|BHARTI ||254.20 ||257.00 ||252.00 ||253.10|
|SAIL ||51.50 ||52.20 ||51.50 ||51.80|
|GUJAMBCEM ||62.85 ||62.85 ||60.50 ||60.85|
|CIPLA ||325.00 ||329.00 ||321.00 ||325.35|
|M&M ||595.95 ||615.00 ||593.00 ||595.40|
|BHEL ||881.00 ||890.70 ||866.00 ||887.20|
|GRASIM ||1079.00 ||1088.90 ||1068.00 ||1076.90|
|GLAXO ||858.70 ||888.00 ||840.15 ||851.05|
|TATATEA ||637.75 ||659.00 ||630.00 ||638.10|
|HINDALC0 ||1238.90 ||1246.00 ||1225.00 ||1231.00|
|BPCL ||345.50 ||348.80 ||340.00 ||340.30|
|ORIENTBANK ||262.80 ||264.90 ||255.40 ||256.95|
|DRREDDY ||753.00 ||757.90 ||735.00 ||738.40|
|SCI ||143.00 ||147.85 ||142.15 ||146.40|
|NATIONALUM ||151.00 ||153.65 ||148.25 ||151.85|
|HCLTECH ||379.00 ||379.35 ||368.10 ||369.90|
|ABB ||1479.90 ||1480.00 ||1453.00 ||1465.45|
|SUNPHARMA ||629.80 ||629.80 ||600.00 ||600.45|
|COLGATE ||242.50 ||244.50 ||238.00 ||240.30|