Sensex above 9500, markets bet on quarterly earnings
03 January 2006
The indices opened with gains and saw a decline to yesterday's closing levels immediately thereafter. From there on it was a steady one way move upwards till closing, breaking pervious lifetime highs on the way.
Strong expectations for the earnings season are encouraging traders to build up positions in the futures segment. Major companies are due to announce their quarterly numbers over the next few weeks.
The Sensex crossed 9500 by afternoon and saw a new lifetime intra-day high of 9547. The Nifty, too, posted a new lifetime high of 2887.
There was not even a hint of an intra-day profit booking, except during the last few minutes of trade. Both indices closed at new lifetime closing highs.
Glaxo Pharma was the best performer among index stocks, closing more than 6 per cent higher. Among the other pharma stocks, Dr Reddy added more than 3 per cent.
Cement stocks were among the strong performers of the day, helped by excellent growth in shipments for the month of December. Grasim was the biggest gainers in this sector, closing nearly 4 per cent higher. ACC gained more than 3 per cent while Gujarat Ambuja closed more than 2 per cent higher.
Nalco continued its rally from yesterday and closed almost 3.5 per cent higher. Hindalco also closed with good gains.
Maruti was the best performer among auto stocks, helped by good growth in domestic sales for the month of December. Reports of good demand from domestic institutions for the disinvestment programme in the company are also helping the stock. Maruti closed more than 3 per cent higher.
Technology stocks were led by TCS which gained more than 2.5 per cent. Software companies are due to announce their third quarter numbers next week. Wipro closed more than 2 per cent higher while Satyam and Infosys ended with gains of more than a per cent each.
HDFC, VSNL, ABB and HPCL were the other major gainers among index stocks.
The biggest loser among index stocks was Jet Airways, closing three quarters of a per cent lower. There are reports of a possible price hike in aviation fuel as crude oil prices have recovered considerably.
Tata Chemicals corrected marginally after yesterday's gains. Cipla and Sun Pharma also closed lower.
Sensex closed at 9539, a gain of 149 points, and the Nifty at 2883, higher by 47 points. Nifty January futures closed at a discount of 15 points to the spot index.
Crude oil is holding on to higher levels and is trading above the $61 per barrel mark in early European trades today.
The board of Reliance Energy has approved the merger of Reliance Energy Ventures with itself. The merger is subject to shareholder and regulatory approval. Reliance Energy Ventures is the new holding company to which the holdings of Reliance Industries in Reliance Energy are being transferred.
Shareholders of Reliance Energy Ventures would get 7.5 shares of Reliance Energy for every 100 shares held.
The board of Reliance Capital has also approved the merger of Reliance Capital Ventures with itself. Shareholders of Reliance Capital Ventures would receive 5 shares of Reliance Capital for every 100 shares held.
According to media reports, Videocon International is planning to invest up to $750 million in various businesses. The company is planning to expand capacities for television panels and components as well as increase investments in the oil sector.
Reports indicate that MTNL's services have received a good response in Mauritius. The company had acquired the license last year and is offering fixed, mobile and international services. The company is planning to invest up to $25 million in Mauritius.
Cement stocks attracted a lot of interest today on reports that companies would raise prices by Rs3 per bag in western states, including Maharashtra. The strong growth in December despatches reported by ACC also added to the bullish sentiment. The company said its despatches for the month of December rose 18 per cent as compared to the same month of previous year.
December despatches of Gujarat Ambuja Cement rose 7 per cent as compared to the same month of previous year. Cement companies had reported subdues shipment growth for the last couple of months.
NTPC is planning to add close to 3,000mw of additional generation capacity in the southern states over the next five or six years. The company's equal joint venture with Tamil Nadu electricity board to set up a 1,000mw power plant would also go on stream within this period.
Strong growth in tractor sales volumes for the month of December attracted interest in M&M. The company reported a sales growth of 28 per cent as compared to the same month of last year. However, the company reported a 3 per cent fall in sales of other automobiles, like SUV's and utility vehicles.
Mid-Cap Action
Mid-caps continued their strength from yesterday, though the gains on the mid-cap index lagged the frontline indices. The CNX Mid-Cap index gained 60 points and closed the day at 4117.
Midday Multimedia has signed an agreement with BBC Worldwide, under which BBC would invest Rs32 crore in the radio venture. A large individual investor would also invest Rs10 crore in the radio broadcasting subsidiary. The funds would be used to bid for new licenses and expand the reach.
Jubilant Organosys has announced that it has entered into an agreement with US pharma company Eli Lilly. Under the 5-year agreement, Jubilant would collaborate with Eli Lilly in drug research and development. Financial terms of the deal were not announced.
Aurobindo Pharma has announced that it has received tentative US FDA approval for an anti-aids drug in oral suspension form.
i-flex has informed the exchanges that a commercial bank based in Greece has selected the company's core banking platform. As per the release from the company, the bank has more than 450 branches which would be covered in phases. Financial details have not been provided.
