Markets were expected to correct modestly after the sharp bounce back of last two sessions. Asian markets trended weak on profit booking following a subdued closing by the US indices on Friday.

Indices opened weak and slipped more than a per cent each before recovering. After inching back into the positive, Sensex slipped again in early afternoon trades only to stage another recovery.

After another fall in mid-afternoon trades, both indices surged ahead as European markets opened with gains. Gains in heavyweights like Infosys and Reliance Industries and a recovery in ONGC helped the indices considerably.

Sensex crossed 10000 in the last half hour of trade, but averaging saw the index settle marginally below that level for the day.

Sensex closed with gains of 113 points at 9998 and the Nifty gained 27 points to close at 2917. Nifty June futures ended at a premium of 5 points to the spot index.

Auto stocks led today's rally from the front. Tata Motors was the biggest gainer among index stocks, closing 6 per cent higher. Maruti gained close to 4 per cent and M&M gained more than a per cent.

Bajaj Auto added nearly 3 per cent and Hero Honda closed nearly 0.5 per cent higher.

Among FMCG stocks, Tata Tea added more than 5 per cent while HLL closed nearly 3.5 per cent higher. ITC closed almost a per cent higher and Dabur gained more than 3 per cent.

Cipla was another big winner, closing almost 5.5 per cent higher.
Among cement stocks, ACC added close to 5 per cent and Gujarat Ambuja gained nearly a per cent. Grasim ended 2.5 per cent higher.

Tata Steel was the big winner among metals, adding 3.5 per cent. Hindalco closed nearly 3 per cent higher. SAIL closed almost 0.5 per cent higher.

BHEL maintained the up trend and added another 3 per cent.

Reliance Industries remained strong throughout the session and added nearly 1.5 per cent and IPCL ended with gains of close to 3.5 per cent.

ONGC recovered from early losses and ended more than 0.5 per cent higher.

Infosys rallied from a weak start and closed 2.5 per cent higher. Satyam added close to 0.5 per cent.

Sun Pharma was the biggest loser among index stocks, closing more than 2.5 per cent lower. Among other pharma stocks, Glaxo lost more than a per cent.

Select tech stocks came under pressure after last week's gains. Wipro and TCS ended with losses of around a per cent each.
L&T recovered from a 3.5 per cent decline and closed more than 2 per cent lower.

Among banking stocks, SBI lost nearly 2 per cent while ICICI Bank lost more than a per cent.

BPCL, Jet Airways and Bharti lost around a per cent each.

Global markets / crude oil
Asian markets had a weak day following spectacular gains towards the end of previous week. Indonesia was the biggest loser, closing more than a per cent lower after gaining 5.5 per cent on Friday. Thailand and South Korea lost around 0.8 per cent each while Hong Kong declined nearly 0.5 per cent.

Singapore lost 0.25 per cent while Japanese Nikkei gave up mid-session gains and closed with modest losses. Shanghai remained firm and closed with gains of over 0.75 per cent.

European markets are not seeing any profit booking today. Major Western European indices are trading with gains of between 0.8 and 1.6 per cent each.

Crude oil prices have slipped further on expectations of a peaceful settlement to the Iranian nuclear issue. Near month NYMEX futures has lost a per cent and is trading around $69 per barrel in early European trades today.

Large-cap news flow

• has won two new contracts worth a total of $30 million from South American customers. The company would manage the BPO & IT operations for the public transport network planned for the Chilean capital city of Santiago. The second contract is from a leading bank to manage back office operations.
  
  
• Bharti Airtel has won the Frost & Sullivan Wireless Service Provider and Competitive Service Provider of the year awards for the Asia - Pacific region.
  
  
• Essar Steel has received High Court approval for the merger of Hy-Grade Pellets and Steel Corporation of Gujarat with the company.

Mid-Cap Action

Mid-caps and small caps outperformed the larger stocks today by a wide margin. They remained firm even as frontline stocks faced selling pressure in morning trades. Many of the popular mid-cap stocks continued their recovery from last week and closed with significant gains.

The CNX Mid-Cap index ended with gains of 70 points, or 1.9 per cent, to end the day at 3768. Market breadth on the NSE was negative in morning trades but turned positive in the afternoon.

The BSE mid-cap index gained 2.34 per cent and the BSE small cap index closed 2.42 per cent higher.

Aztec Software and Sutlej Industries closed with gains of 20 per cent each. Tata Teleservices, JK Lakshmi Cement, Bajaj Auto Finance and SRF closed with gains of over 15 per cent each.

Supreme Industries, AP Paper, Man Industries, Godavari Power and Ispat, Bajaj Hindustan, Aban Loyd and Mysore Cements were among the other major mid-cap gainers.

Vimta Labs, BRFL, Voltas and Dishman were among the major mid-cap losers.

Mid-cap news flow

• IndiaBulls Financial would issue convertible preference shares worth Rs345 crore to a fund managed by Farallon Capital, one of the largest hedge funds in the US. The preference shares are convertible at Rs300 per equity share. Farallon would also subscribe to non-convertible preference shares worth Rs299 crore.
  
  
• HSBC has selected the banking software suite Flexcube from i-Flex for deployment in its institutional fund services business in Asia and the Middle East. Financial details of the deal have not been disclosed.
  
  
• Balrampur Chini would invest around Rs750 crore to set up 2 new sugar mills in the state of UP with crushing capacity of 8,000 tonnes per day each.
  
  
• The board of GHCL has approved the acquisition of a
  UK- based home textiles retail chain for an undisclosed amount, subject to due diligence and approvals. The target company currently has revenues of £115 million.
  
  
• Nagarjuna Construction has received a new order worth Rs152 crore for construction of a sports complex in the state of Jharkhand. The company has also received another order worth Rs270 crore from Maharashtra electricity distribution company.
  
  
• Hotel Leelaventure is considering a stock split and the board would meet next week for this purpose.
  
  
• Geometric Software has signed an agreement with IBM to offer product lifecycle management (PLM) solutions to clients.
  
  
• The board of Assam Company would meet next week to consider issue of convertible warrants to overseas investors as per FIPB approval.
  
  
• Precision Electronics would issue bonus shares in the ratio of 3 shares for every 2 shares held.
  
  
• Nava Bharat Ferro Alloys would set up a 64 MW coal based power unit in the state of Orissa.
  
  
• The board of R Systems would meet next week to consider the acquisition of a US based technical support services company for $10.7 million.
  
  
• Venus Remedies has entered into an agreement with a US university to launch a new system for detecting tumours in India and neighbouring countries. The company said the product would be launched by next year.
  
  
• Era Constructions has won a contract worth Rs32 crore from BHEL for civil construction work at a thermal station.
  
  
• GV Films would acquire a multiplex theatre complex in Ahmedabad for Rs15 crore. French bank BNP Paribas would invest Rs100 crore in the company through an equity issue. BNP would also infuse another Rs300 crore through convertible warrants.
  
  
• Meanwhile Geojit Financial Services has denied reports that BNP Paribas would take a 26 per cent stake in the company.
  
  
• Madhucon Projects has signed a 20-year concession agreement for developing a highway stretch in Tamil Nadu on a BOT basis. The project is expected to cost Rs340 crore.
  
  
• ICICI Bank has subscribed to equity shares worth Rs10 crore in Andhra Cements. Promoters of the company has subscribed to shares worth Rs30 crore.
  
  
• Radico Khaitan would increase the amount to be raised from its overseas issue to $125 million from $100 million.
  
  
• ABG Shipyard has won a new order worth $10.55 for an anchor handling tug from a Cyprus based company. ABG has till now received orders for 11 such vessels from the same company.
  
  
• Brakes Auto is considering a new Rs30 crore plant in Maharashtra in collaboration with British and Turkish companies.
  
  
• AVT Natural Products would manage a Thailand company on a contract basis for a period of three years.
  
  
• Pratappur Sugar would set up two new sugar plants with aggregate crushing capacity of 27,000 tonnes per day at an investment of Rs695 crore. The company would also set up a 160 kilo litres per day distillery. Pratappur would issue 38 lakh convertible warrants to Bajaj Hindustan, the promoter company. The warrants are convertible at Rs500 per share.
  

*Disclaimer: The author may have positions in some of 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.

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