Indices retreat after touching new lifetime highs

30 January 2006

Markets opened the day on a highly positive note, continuing the momentum from Friday's surge. The Sensex opened close to 9900 and went past that level in early trades. The strong closing by the US indices on Friday and steady trend in oil prices helped the Asian indices today.

The Nifty crossed the 3000 mark for the first time ever in today's early trades. The Sensex recorded a new intra-day lifetime high of 9945 today and the nifty posted a new high of 3002.

However, both the Sensex and the Nifty saw a sharp fall by mid-morning and the Sensex went very close to 9800 before recovering, a fall of nearly 150 points from the highs of the day. Some of the big stocks saw selling pressure on disappointing quarterly results.

The indices clawed back into positive territory by noon and held those levels till late in the afternoon. Fresh selling pressure in closing trades pulled both indices into the red for the second time during the session.

Dr Reddy's was the best performer among index stocks as the strong quarterly numbers announced by the company last week are attracting lot of buying interest. The stock closed nearly 5.5 per cent higher. Ranbaxy also added more than 1.5 per cent.

Reliance Industries closed nearly 2 per cent higher, providing some support to the indices. Dabur was another strong performer, gaining 5 per cent.

Wipro, Gail, Shipping Corporation and ACC were among the other major gainers in large caps.

SBI was the biggest loser among index stocks as the results announced over the weekend were considerably below expectations. The stock closed more than 3 per cent lower.

BPCL was another loser following the announcement of below par results. The stock closed nearly 2.5 per cent. ONGC gave up over 2 per cent.

Hero Honda lost nearly 3 per cent as the results announced today did not have any positive surprises.

ABB, PNB, Maruti and HLL were among the other major losers in index stocks. Jet Airways lost close to another 2 per cent today.

Sensex closed at 9849, a loss of 22 points, and the Nifty at 2975, lower by 8 points. Nifty February futures closed at a discount of 4 points to the spot index.

Crude oil is trading at $67.5 per barrel, lower by 0.5 per cent from Friday's close, as a crucial meeting of the International Atomic Energy Agency is due this week to discuss the Iranian nuclear programme.

ONGC has reported a net profit of Rs3,887.76 crore for the December quarter as compared to Rs3,493.32 crore for the prior year quarter. Total revenues were higher at Rs13,038.01 crore as against Rs12,565.13 crore.

Meanwhile, media reports indicate that ONGC would acquire a 30-per cent stake in an oil block in Brazil. The stake would be acquired from Exxon-Mobil for an unconfirmed amount of $1.4 billion. The central government had earlier cleared the company's investment plans in Brazil.

Gujarat Ambuja has announced that its existing promoters have sold a 14.8 per cent stake in the company to Swiss cement major Holcim. The deal was concluded at a price of Rs105 per share, including a non-compete premium of Rs15. Holcim would make an open offer for an additional 20 per cent from the public at Rs90 per share.

High crude oil prices and the government's reluctance to raise retail prices are affecting the bottom lines of PSU oil marketing companies. After Indian Oil, which slipped into the red in the December quarter, both HPCL and BPCL have reported losses in excess of Rs1,000 crore each.

BPCL has reported a net loss of Rs1,024.2 crore for the December quarter as compared to a profit of Rs145.7 crore for the prior year quarter. Total revenues for the quarter increased to Rs18,944.1 crore from Rs16,627.2 crore.

HPCL has reported a net loss of Rs1,077.75 crore for the December quarter as compared to a profit of Rs235.92 crore for the prior year quarter. Total revenues for the quarter increased to Rs18,311.34 crore from Rs16,328.29 crore.

PSU power generation major NTPC has reported a net profit of Rs1,781.7 crore for the December quarter as compared to Rs1,365.5 crore for the prior year quarter. Total revenues for the quarter were higher at Rs7,671.5 crore as compared to Rs6,270.6 crore.

Two-wheeler major Hero Honda has reported a net profit of Rs261.78 crore December quarter as compared to a profit of Rs218.93 crore for the prior year quarter. Total revenues for the quarter increased to Rs2,350.81 crore from Rs2,043.15 crore.

Gujarat Ambuja Cements has reported a consolidated net profit of Rs121.45 crore for the December quarter as compared to a profit of Rs90.32 during the prior year quarter. Total revenues for the quarter were at Rs790.86 crore as against Rs775.87 crore.

A consortium of L&T and Patel Engineering has won a new order from the National Hydroelectric Power Corp for construction of a 520 MW power project in the state of Himachal Pradesh. L&T said the order is worth Rs439.07 crore without disclosing its share of the order.

Suzlon Energy has announced that it has received an order from a US-based customer for wind turbines with a total capacity of 157.5 MW. The turbines would be delivered by early 2007. The company said its total order book now stands at Rs4,232 crore.

Suzlon has reported a net profit of Rs161.94 crore for the December quarter as compared to Rs37.28 crore for the prior year quarter. Total revenues increased to Rs881.84 crore as against Rs290.45 crore.

Mid-Cap Action