Indian markets defied all negative global cues today as well, as they sought new levels. US markets had met with deep correction for the second day on Friday as oil prices continue to climb. Many Asian markets saw heavy losses today, following the trend in US markets.
Indian indices were in no mood to follow global trends in the morning. They took off from Friday's closing and by noon both indices were at new all time highs. The Sensex crossed the 7200-mark for the first time ever in the process.
The gains could not be held as some amount of profit booking emerged in heavyweights led by Reliance Industries. The stock, which was trading with gains till early afternoon, suddenly declined and went into the red. Reliance closed a per cent lower.
Both indices slipped marginally into the red in the last half hour, but managed to recover to close with very marginal gains. Volumes were very high at over Rs28,000 crore, combined for the cash and derivative segments at both the exchanges.
Sensex closed at 7151, up 2 points and the Nifty at 2200, up 5 points from Friday's close. Nifty June futures discount to the spot widened to 20 points from Friday's 16 points.
Among Nifty stocks, IPCL, HDFC Bank and Dabur were the major percentage gainers while Hero Honda, SAIL and VSNL were the major losers.
Just when the left parties raised their voice against the BHEL disinvestment, there are unconfirmed reports that the government is planning to offload 15 per cent stake in Shipping Corporation. It is very surprising to hear such noises from the government when some of the left parties are even talking about withdrawing their support to the government on this issue.
SCI shot up over 3 per cent after a news agency reported that the shipping ministry has suggested a stock split. The specific source of this news is not yet known. It is highly improbable that the ministry would suggest a stock split and that too for a stock quoting under Rs150 per share. The stock closed with gains of over 2 per cent.
Reliance Capital continued to defy gravity today as well. After last week's gains of close to 45 per cent, the stock moved well over 10 per cent in morning trades. Though the stock could not maintain those levels, it closed with gains of 7 per cent.
Reliance Capital has convened an EGM to hike the FII investment limit to 49 per cent. There are also reports that Temasek Holdings, the investment arm of government of Singapore, will take a large stake in the company.
IPCL was the other Reliance group stock which saw considerable buying interest today. The stock gained close to 13 per cent in early trades on rumours of a bonus issue and merger with Reliance Industries.
The stock gave up part of its gains after the management clarified that the company is not considering any merger as of now. The stock closed with gains of over 5 per cent.
Reliance Industries also gained close to 2 per cent in early trades after some newspapers reported that the company was planning to set up a chain of motels across the country. This is believed to be part of the company's foray into retail shopping and entertainment complexes. Reliance has denied all such plans.
Bharat Forge, the country's largest forging company and the world's second largest, has acquired Federal Forge of the US. The acquisition is an all cash deal for $9.1 million.
The US company, which was under bankruptcy, has a turnover of around $60 million. It is a supplier to many major ancillaries of US auto companies. The acquisition would strengthen Bharat Forge's presence in the US.
Indian Hotels has re-entered New York after a gap of six years. The company signed a lease agreement for the Pierre Hotel, a premium hotel in New York. The company would be investing over $35 million to renovate the new property and improve facilities. The stock closed more than a per cent lower.
NTPC is planning to set up a 900mw power project in Sri Lanka. The company will be submitting a detailed proposal to the government of Sri Lanka for the project which could be either coal or gas based.
Larsen & Toubro has won a contract from National Highway Authority for construction of a 6-lane flyover in Haryana. The contract is valued at over Rs400 crore.
ONGC and ITC were the other major gainers among frontline stocks with gains of over 2 per cent each.
The mid-cap index opened strongly and traded firm till early afternoon, but could not hold on to their gains. CNX Mid-Cap 200 index closed at 3019, a loss of 10 points.
Stocks of many Gujarat state PSU companies gained after reports that Gujarat State Petroleum Company has stuck a huge natural gas reserve of 20 trillion cubic feet off the Andhra coast. This is one of the largest gas discoveries anywhere in the world in the recent past.
GSPC holds an 80 per cent interest in the oil block. The only listed company with some holding in GSPC is Gujarat Gas. GSPC may come out with a public issue to finance the development of the field.
There are reports that Swedish Match Company, promoters of Wimco Limited, is in talks to sell the domestic safety match company to ITC. With a turnover of close to Rs150 crore, Wimco controls around 25 per cent of the safety match industry in the country.
Wimco has been making huge losses for the last two years. ITC had launched safety matches under different brand names in the recent past and considers safety matches to be a natural extension of its tobacco business. Wimco denied such reports later in the day.
Petronet LNG has hiked the investment outlay for its Kochi LNG terminal project to Rs2,000 crore from Rs1,600 crore. The terminal will have an initial capacity of 2.5-million tonnes per annum, which will be hiked to 5-million tonnes. Petronet has already tied up gas supplies from Iran for the terminal.
The project which was conceived a couple of years back had faced some uncertainty as NTPC did not confirm the off take of gas for its thermal plant capacity expansion. Some of the large oil marketing companies are now believed to have agreed to lift gas from the proposed terminal.
According to reports, the government is planning to sell its stake in Tide Water Oil. The government holds around 26 per cent in Tide Water, which markets automotive and industrial lubricants.
Unconfirmed reports suggest that ONGC is keen on acquiring the government's stake in Tide Water and a due diligence is underway. The stock gained over 15 per cent after the reports came out.
Swaraj Mazda gained over 6 per cent early in the day. Recently, Punjab Tractors had decided to sell 15-per cent stake in Swaraj Mazda to Sumitomo of Japan. After the deal, Sumitomo's holdings will rise to 26 per cent in Swaraj Mazda.
Torrent Pharma gained over 8 per cent on reports that the company is close to acquiring a German generics company. The company has not confirmed this report.
Murudeshwar Ceramics, Helios & Matheson and ITI Limited were among the best performing stocks among mid-caps.
JSW Holdings, Jindal Poly Films and Indian Hume Pipe 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.