labels: stock markets - india, markets - general
Sensex slips 113 points on renewed inflation fearsnews
16 March 2007

Indices slipped after a firm start today as well and, unlike yesterday, they ended deep in the red. Firm trend across most global indices helped the frontline indices to gains over 0.5 per cent each in early trades. They started slipping as other Asian markets could not hold on to their gains. Higher than expected inflation pulled down the indices further.

Sensex closed with losses of 113 points at 12430 and the Nifty lost 35 points to end at 3609. Nifty March futures closed at a discount of 39 points to the spot index.

Suzlon Energy was the worst performer among index stocks with losses of 5.78 per cent. The stock was hammered following reports of a possible higher bid for German company RE Power.

BHEL shed 2.79 per cent and L&T closed 2.73 per cent lower. Siemens gave up 2.17 per cent.

HCL Tech was the worst performer among tech stocks and ended 3.52 per cent lower.

Reliance Communications had a bad day with losses of 3.38 per cent.

Hero Honda closed 3.43 per cent and M&M gave up 2.19 per cent.

Dabur ended with losses of 3.43 per cent.

Gail India was the other major loser and gave up 2.78 per cent.

Tata Motors recovered most of yesterday's losses and ended 3.07 per cent higher.

Reliance Industries added 1.31 per cent on unconfirmed reports of a large overseas deal. IPCL added 0.6 per cent.

Lower crude oil prices helped oil marketing stocks. BPCL gained 2.03 per cent and HPCL added 1.67 per cent.

Dr. Reddy's gained 1.66 per cent while Ranbaxy added 1.62 per cent.

Zee Entertainment recovered 1.97 per cent.

Among other gainers, VSNL added 0.98 per cent and Hindalco closed 0.62 per cent higher.

Global markets / crude oil
US markets sustained the up trend yesterday despite higher than expected producer price inflation. Market sentiment was helped by expectations that the troubles of some mortgage lenders may not spread to the entire sector.

The Dow gained over 0.2 per cent and the S&P 500 closed more than 0.35 per cent higher. The NASDAQ closed with gains of nearly 0.3 per cent.

Asian markets recovered from a weak start but most major indices slipped again in the afternoon. Singapore was the worst performer with losses of close to 0.85 per cent. Shanghai gave up over 0.7 per cent and Japan ended nearly 0.7 per cent lower. Thailand lost close to 0.5 per cent and Hong Kong declined 0.1 per cent.

Malaysia, Indonesia and South Korea ended with modest gains of below 0.15 per cent each.

Major European indices are trading with losses of between 0.3 per cent and 0.55 per cent each in afternoon trades.

Crude oil prices declined yesterday as OPEC decided to hold production levels while forecasting slightly higher demand for the current year. However, markets expect global energy demand to decline as economic growth slows down. Near month NYMEX futures ended around a per cent lower at $57.55 per barrel yesterday. The commodity is trading with modest gains in European trades today.

Large-cap news flow

  • have signed an agreement for cooperation in the fields of gas pipelines, gas distribution and exploration.
  • Satyam Computer has formed a business alliance with a foreign IT solutions company to offer comprehensive logistics IT solutions
  • Ranbaxy has received preliminary US FDA approval for a drug used for the treatment of insomnia and related disorders. The company has reportedly made it to the second round of bidding for the generic pharma business of German company Merck.
  • Canara Bank would raise Rs500 crore in upper tier-II capital by issuing 15-year subordinated bonds at a coupon rate of 10 per cent per annum
  • NTPC would spend close to Rs1 lakh crore to expand capacity by 22,000 MW over the next 5 years, according to media reports. The company would spend close to Rs13,500 crore to expand capacity in the next financial year and is negotiating for debt facilities
Mid-Cap Action
Mid-caps and small caps also lost ground after resisting the decline yesterday. The CNX Mid-Cap index ended with losses of 35 points, or 0.74 per cent, at 4599. BSE mid-cap index lost 0.86 per cent and the BSE small cap index ended with losses of 1.47 per cent.

Page Industries had a very weak listing on the exchanges today. Issued at Rs360 per share, the stock opened at Rs329 on the NSE and saw a low of Rs261.1 before finally ending at Rs268.

Raj TV, another new listing today, also had a disappointing first day. Issued at Rs257 per share, the stock opened at Rs225 on the NSE and saw a low of Rs207.2. The stock finally settled at Rs218.5.

Evinix, a recent listing, slipped 9.96 per cent. Indus Fila, another recent listing, gave up 6.8 per cent.

Among prominent mid-caps, Bajaj Hindustan slumped 7.37 per cent.

Shasun Chemicals, Shivam Autotech and Foseco India were the other major losers among mid-caps.

La Opala, which got listed on the NSE today, added 23.38 per cent.

McLeod Russell, SI Group, Sandesh, Indo-Asian Fusegear, BBTC, Wartsila, Pudumjee Pulp, Shivalik Global and Pritish Nandy were among the other mid-cap gainers.

Mid-cap news flow

  • has completed the acquisition of 97.8 per cent stake in Malaysian company Sabah Forest Industries for $253.7 million. There are unconfirmed media reports that Bilt would invest a total of $1 billion to expand its Malaysian business
  • Madhucon Projects would take a 48 per cent stake in a 540 MW power project in Andhra Pradesh. Investment details for the proposed project have not been disclosed
  • Punj Lloyd said a subsidiary of the company has won an order to build a large bio-ethanol plant in the UK. Financial details of the order have not been announced
  • The board of GTL Infrastructure has approved the draft letter of offer for the proposed equity issue
  • The board of Nagreeka Exports would meet later this month to allot new shares of the company following the de-merger of Nagreeka Capital & Infrastructure
  • The board of Yash Papers would meet next week to consider the preferential issue of warrants
  • Indo Rama Synthetics has commissioned the additional capacity of 300,000 tonnes per annum
  • IndusInd Bank has increased the interest rate on domestic term deposits
  • Sakthi Pumps has started production at its new automated pump manufacturing plant at Indore
  • Asian Paints said its equal JV Asian PPG has paid Rs45 crore for the acquisition of the auto refinish business of ICI India and the balance Rs7 crore would be paid by next quarter
  • Gujarat Borosil would invest Rs40 crore to set up a new figured glass plant
  • Vijay Textiles has completed the construction of its new factory premises
  • The board of Thomas Cook India would meet next week to consider a rights issue
  • Pritish Nandy has completed the QIP issue of 40 lakh equity shares at Rs70 each
  • Atul Auto is planning to raise Rs20 crore from a preferential issue to domestic or foreign institutional investors
  • Karur KCP has received new orders worth Rs18.42 crore for supplying packaging material
  • Shareholders of McLeod Russell would meet next week to consider the merger of Doom Dooma Tea with the company
  • Morepen Laboratories would raise Rs150 crore from an equity issue and Rs100 crore from a warrant issue on preferential basis to international investors. The company would also issue equity shares worth Rs17 crore and convertible preference shares of Rs90 crore to financial institutions and banks as part of a settlement package
  • Moser Baer has launched Hindi movies on VCD and DVD across the country
  • Banswara Syntex has won new export orders worth Rs20 crore
  • Rain commodities said it is confident that its proposed buy-out of a US-based company would go through despite the emergence of another bidder. The company has sought legal opinion on the matter
  • Rolta India has denied media reports about an acquisition
  • The board of Cholamandalam DBS would meet later this month to consider attaching convertible warrants to the proposed rights issue of equity shares
*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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Sensex slips 113 points on renewed inflation fears