The market momentum is so strong that even the worst-ever flooding in the history of the country's financial capital cannot stop its onward march. After opening on a weak note, the indices gained strength on the back of very strong quarterly results from Reliance Industries and closed the day at new lifetime-highs. The Sensex closed the day above 7600 for the first time ever.

The day started with doubts about whether the exchanges would be able to function smoothly in view of the large scale disruptions in Mumbai. Finally the exchanges did open for business as usual, though there were reports of problems at the depositories.

Market volumes at around Rs24,000 crore were not affected much, even though most of the Mumbai traders could not participate. After remaining low in the initial hours of trading, volumes picked up later in the day. Volumes were over Rs30,000 crore yesterday.

The day once again belonged to banking stocks which continued their strong showing today as well. HDFC Bank was the biggest gainer among large banks, closing with gains of close to 4 per cent. While SBI closed with gains of 3 per cent, ICICI Bank gained well over 3 per cent.

Sensex closed at 7605, a gain of 52 points and the Nifty at 2319, a gain of 16 points. Nifty July futures closed the day at a premium of 2 point to the spot index.

VSNL, HDFC Bank and ICICI Bank were among the major gainers among Nifty stocks while Zee Tele, Tata Steel and M&M were the major losers.

US markets had a mixed session yesterday. The Dow closed lower while NASDAQ closed with gains of close to half a per cent. S&P 500 also managed to close with gains.

Indian Tech ADR's had a mixed day yesterday with Wipro losing 3 per cent while Satyam and Infosys managed to close with gains. Dr. Reddy's was the best performing Indian ADR on the US exchanges yesterday. Encouraged by the strong quarterly results, the stock gained over 6 per cent. Tata Motors and HDFC Bank also managed to close with gains.

Reliance Industries gave a pleasant surprise to the markets by announcing a more than 60 per cent growth in first quarter profits as compared to the same quarter of previous year. Revenues were higher by over 23 per cent at close to Rs18,000 crore.

The company said firm product prices led to an expansion in margins and helped the company in overcoming the volatility in raw material prices. The company would invest over $1.5 billion to build oil and gas production facilities in the east coast. The stock closed with gains of over a per cent, at a new life time high.

Refining margins of Reliance Industries for the quarter were higher by 7 per cent at around $8 per barrel and the Jamnagar refinery achieved a capacity utilisation of 96 per cent.

The board of directors of Reliance Industries who met today did not discuss the restructuring of the group. A formal announcement is expected before the company's AGM scheduled early next month. The company has also decided to close its share buy back programme prematurely on 2002 August.

Tata Steel's first quarter results disappointed the markets and the stock closed the day with losses of well over 3 per cent. Revenues were higher by 10 per cent and profits were higher by over 27 per cent on a consolidated basis as compared to the same quarter of previous year.

Total production and sales of steel for the quarter were lower by over 5 per cent. Though the company managed to improve margins, growth in top line and profits were far lower than market expectations.

Tata Steel maintained that domestic steel demand continues to remain robust even though prices may soften marginally. The company is on the lookout for more domestic and international acquisitions to emerge as a significant global player.

Tata Tea reported a 90 per cent surge in first quarter profits on a revenue growth of 10 per cent as compared to the same quarter of previous year. Strong product prices and improved margins from branded products helped the company to report higher profits.

VSNL surged over 4 per cent in intra-day trades to a new high, comfortably crossing the Rs400-per share mark on the way. After the announcement of its acquisition of NASDAQ listed Teleglobe the day before, the stock had closed with gains of over a per cent yesterday.

Tata Power reported an over 15 per cent growth in first quarter profits as compared to the same quarter of previous year. Revenues were marginally higher by 2 per cent.

Most technology stocks made a strong comeback after remaining subdued for the last few days. Wipro closed almost 3 per cent higher while Satyam gained close to 2 per cent. TCS closed the day with gains of well over a per cent. Gains on Infosys were lower at less than a per cent.

Mid-Cap Action

Mid-caps underperformed the frontline stocks for the forth day as selective profit booking continued. Some of the stocks which had seen substantial gains corrected on disappointing financial results. The CNX Mid-Cap 100 index closed the day at 3439, a gain of 1 point.

Stock broking company IL&FS Investmart made its entry on the bourses today after its recent IPO. Issued at Rs125 per share, the stock opened on the NSE at Rs195 and saw a high of Rs200 before closing at Rs183.

Strong buying continued in India Bulls, also in the stock broking business, which gained over 6 per cent to close at a new life time high. The stock price has multiplied over 13 times from its IPO price of Rs19.

Deccan Chronicle reported an 80 per cent increase in first quarter profits as compared to previous year. Revenues were higher by over 90 per cent. The company had launched a new edition of its newspaper in Chennai besides taking over the English-language newspaper Asian Age.

Deccan Chronicle had also increased the advertisement rates during the quarter. These helped the company report excellent growth in both top line and bottom line. The stock surged over 8 per cent after the announcement before closing with gains of over 5 per cent.

Automotive battery manufacturer Exide Industries reported a 30 per cent growth in first quarter profits on a revenue growth of over 20 per cent. The stock was one of the significant gainers among mid-caps, closing with gains of over 13 per cent.

Exide will buy out GMR Industries' 49 per cent stake in ING Vysya Life Insurance for Rs200 crore. The company would also subscribe to fresh warrants of ING Vysya Life Insurance which when converted into equity shares would take the total holding to over 50 per cent.

Andhra Bank reported a 43 per cent decline in first quarter profits as compared to previous year. Total income was lower by close to 10 per cent. The stock lost over 6 per cent after the announcement.

KLG Systel, Easun Reyrolle and Havells India were among the best performing stocks among mid-caps.

Supreme Petrochem, Narmada Chematur and ITI Limited 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.

Other articles by Rex Mathew

List of general reports on markets

List of general reports on finance