The markets opened marginally higher today morning but remained lacklustre till about early afternoon, stuck in a band. Weakness in some of the better performing stocks of last week gave the indices a negative bias throughout the morning.

A bout of buying early in the afternoon saw the indices climb back into the green as some heavy weights like ONGC, ICICI Bank and some cement and power stocks rallied.

The uptrend was short lived as the profit booking started almost immediately and the indices declined to the lows of the day.

Sensex closed at 6455, down 26 points and the Nifty at 1994, down 6 points. Nifty May futures discount to the spot index widened to 19 points from yesterday's 17 points.

Among Nifty stocks, ICICI Bank, Tata Power and ACC were the major percentage gainers while Oriental Bank of Commerce, BPCL and Tata Motors were the major losers.

US markets held on to their gains of last week as technology stocks did well ahead of results from Cisco and Dell due this week. After opening flat, the indices gained by afternoon as an increase in corporate merger activity kept the market excited. NASDAQ gained over half-a-per cent while Dow's gains were lower.

Crude oil futures on NYMEX gained close to 2 per cent as the International Energy Agency hiked its global demand outlook for the current year. Crude futures for June delivery closed above $52 to a barrel.

Indian ADR's had a relatively good day yesterday with the IT stocks holding on to their gains of last week. Tata Motors and ICICI Bank gained close to 2 per cent each. All the software stocks Infosys, Wipro and Satyam closed with gains, though marginal. Dr. Reddy's, MTNL and HDFC Bank were among the losers.

ICICI Bank was one of the best performers among index stocks today. The stock has always been an institutional investors' favourite and today's move is also attributed to institutional buying. The bank's venture capital arm, ICICI Ventures, is reported to be investing Rs100 crore in a Chennai-based pharmaceutical exporting group.

Cement stocks were in demand after the cement manufacturers association announced that industry sales increased over 9 per cent for the month of April as compared to the same month of last year. Both Gujarat Ambuja and ACC gained close to 2 per cent each.

There are reports that steel prices may decline up to 15 per cent during the current year. Tata Steel closed over a per cent lower while SAIL gained close to a per cent.

IT stocks had a mixed day with Infosys giving up part of its close to 4 per cent gains from yesterday. TCS also lost close to 2 per cent. Satyam and Wipro however managed to close with gains.

Auto stocks also saw some profit booking after yesterday's gains. Tata Motors lost around 2 per cent while Maruti also closed lower. M&M lost close to a per cent.

Mid-cap action

Saksoft, the stock which started trading only yesterday after its IPO, opened smartly today and was locked in 20-per cent upper circuit by close. At the current price of Rs121, the stock has appreciated an astounding 300 per cent over its issue price of Rs30 in just 2 trading sessions.

Allsec Technologies, the other stock to have made a debut yesterday, recovered part of its losses. The stock closed almost 2 per cent higher, but still below the issue price.

Mid-cap software stock Mphasis BFL gained close to 10 per cent in early trades after reports that a large private equity investor who holds over 35 per cent in the company was planning to sell its stake. The report mentioned that many domestic and overseas software companies were in the race to pick the stake. TCS and Wipro are said to be among the Indian companies looking to buy the stake.

Sugar stocks witnessed some decent buying today with Dhampur Sugar gaining over 7 per cent. There are some reports of an early government decision on sugar decontrol which would allow sugar mills to sell whole their produce at market price. Currently, mills have to sell part of their production to the government at lower than market prices.

Sugar prices in the commodity futures market has been on a declining trend recently. With forecasts of a normal monsoon, traders expect the sugar crop to improve this year which would bring down prices.

Mid-cap cement stocks like India Cements, Rain Commodities and Skanska Cementation also gained following the buying interest in frontline cement stocks.

Pharma company Orchid announced two marketing deals with a US-based companies to market its products in the US and Canada. According to the company, Orchid could receive up to $25 million over the next two to three years as milestone payments from the deals signed in the recent past including the new ones. The stock gained over 5 per cent.

Television picture tube manufacturer Samtel Colour reported a more than 50 per cent increase in profits for the quarter ended March 2005 as compared to the same quarter of previous year. Revenues however fell by over 15 per cent. The stock gained close to 15 per cent by close.

Essar Oil has signed an exploration and production agreement with the government of Myanmar for two exploration blocks in that country. These blocks are reported to be adjacent to the blocks were huge gas deposits were discovered in the past.

Among mid-cap stocks Jaybharat Maruti, Malwa Cotton and LG Balkrishnan were the significant percentage gainers.

Cinevistas, Electrosteel Casting and Bongaigaon Refineries were among the major 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.

Other articles by Rex Mathew

List of general reports on markets

List of general reports on finance