Indices close flat as markets consolidate

As expected, the indices opened the day with a good positive gap as most frontline stocks carried their strengths from yesterday. Though the US markets had closed lower yesterday, domestic indices sought new all-time highs in the morning.

Most of the gains were given up within half an hour, as the markets dipped sharply following weakness in the technology stocks and ITC. Reliance Industries also turned weak early in the morning itself. SBI, Tata Steel and cement stocks lent support to the markets.

The indices drifted downwards till late in the afternoon with regular attempts in between to regain lost ground. Just when it seemed that the markets were heading to a weak close, the indices started a recovery which saw them closing near yesterday's levels.

The Sensex closed flat at 7347 and the Nifty at 2237, a new lifetime closing high, with a gain of 3 points. Nifty July futures closed the day at a premium of 1 point to the spot index.

ACC, VSNL and Sun Pharma were among the major gainers among Nifty stocks, while Hero Honda, ITC and Tata Tea were the major losers.

The US markets closed lower yesterday despite the decline in crude prices, thanks to a lower than expected quarterly performance from Citigroup. Both the Dow and NASDAQ lost well over half a per cent each.

Crude oil futures for August delivery declined over a per cent yesterday on the NYMEX, to close at $57.32 to a barrel.

Indian ADR's had a good session on the US exchanges yesterday. The technology stocks led the show with strong gains, recovering part of the losses of previous week. Satyam gained 3 per cent, while Infosys and Wipro closed with gains of well over a per cent each. The ADRs of HDFC Bank, Tata Motors, VSNL and MTNL also managed to close the day with gains. ICICI Bank and Dr Reddy's closed with marginal losses.

Reliance Energy reported a 42 per cent rise in first quarter profits, helped by a robust 75 per cent increase in investment income. Total revenues increased by around 6 per cent. Income from sale of electricity has declined marginally, while revenues from engineering services and investment operations went up. Profits were also boosted by an increase in operating margin. The stock closed lower by close to 1 per cent.

Reliance Energy has reportedly received all environmental clearances from the government for its proposed gas-based thermal power plant in UP. The company is planning to increase the capacity of the plant from around 3,600 MW to over 7,000 MW.