Bull momentum takes indices to new lifetime highs
13 December 2005
Despite a lacklustre show by global equity markets, Indian indices continued their rally into uncharted territory today as well. Huge optimism about economic growth and continued overseas equity flows are driving the markets higher. The upward momentum is so strong that even frontline stocks are making significant moves in intra-day trades.
US indices had an indifferent closing yesterday and Asian markets were mixed today. Some Asian markets declined today on profit booking though others like Japan and Indonesia held ground. Crude oil had surged past $61 per barrel yesterday, which was expected to exert some pressure on the markets.
The indices opened higher and after some initial hiccups, inched higher till noon. Early afternoon trades saw the indices surging higher on strong buying in frontline stocks.
The markets saw a sharp dip later in the afternoon, but recovered fast and surged again. Both indices posted new lifetime highs in the closing minutes and closed near the day's highs.
The Sensex posted a new intra-day lifetime high of 9274 today and the Nifty recorded a new high of 2815.
Tata Motors made a spectacular move today and closed more than 5.5 per cent higher. M&M was the other winner from the auto space after the company announced an acquisition. The stock added close to 3 per cent. Maruti gained close to 2 per cent.
Cement stocks were all the rage today as the frontline cement stocks made a strong comeback. These stocks had seen some correction last week on disappointing November despatch volumes.
ACC led the pack and closed with gains of more than 5 per cent. Grasim followed with gains of more than 2.5 per cent. Gujarat Ambuja closed more than 2 per cent higher.
FMCG stocks had a good day as ITC gained well over 2 per cent. Dabur continued its rally and ended more than 2.5 per cent higher. HLL closed a per cent higher.
Wipro was the best performer from the technology space, closing more than 2.5 per cent higher. Satyam gained nearly 2 per cent while TCS added around a per cent.
HDFC was the star among banking and financial services stocks, closing nearly 4 per cent higher. SBI gained close to 2 per cent. HDFC Bank and ICICI Bank closed with gains. Kotak Bank closed more than 5 per cent higher. Bank of India and Union Bank were the other big gainers from this space.
Jet Airways was the biggest loser among index stocks. The stock saw some profit booking after a brief rally over the last two weeks on ambitious expansion plans.
Power utility stocks Reliance Energy and Tata Power came under some pressure today. Both stocks had appreciated considerably last week.
Sensex closed at 9264, a gain of 130 points, and the Nifty at 2812, higher by 36 points.
Tata Motors, HDFC and ACC were the major gainers among Nifty stocks while Jet Airways, Reliance Energy and Tata Power were the major losers.
Auto major Mahindra & Mahindra has informed the exchanges that the company has entered into an agreement to acquire an 88-per cent stake in a Mauritius-based design company. The target company, Plexion, provides engineering design and CAD services to clients in the auto and aerospace businesses.
Currently JP Morgan has a majority stake in Plexion and M&M would be acquiring the stake from the investment bank. The size of the deal was not disclosed but reports indicate that it would be in the region of $10 million. M&M management is confident that the acquisition would help its engineering division to broaden its service portfolio.
Hindustan Lever has informed the exchanges that it has sold some of its tea plantations to McLeod Russel for Rs69 crore. HLL had initiated a strategic move to exit low margin plantation business and focus more on marketing tea. Tata Tea also had exited its plantation business in South India recently.
ONGC Videsh, the overseas subsidiary of ONGC, has announced that it has completed the construction of an oil pipeline in Sudan. The 700km pipeline connects the main oil field to a coast based refinery and was financed by ONGC Videsh.
HCL Technologies has announced that it has entered into a strategic partnership with EXA of Japan. EXA is a JV between IBM and a Japanese steel company and is engaged in systems integration. HCL said it is targeting revenues of $100 million from the partnership over the next five years.
