Monday May 6, 03:30 PM
Strength towards close... |
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By Equitymaster.com
At open the volumes were on the lower side as investors shied away from the bourses. Towards close however, there were significant volumes in select second rung technology counters. Other sectors in favour were auto, FMCG and oil PSUs. There was selective buying interest in cement and commodity majors. However, some media stocks were out of favour with the markets.
The BSE Sensex closed at 3,386 (up 5 points) and the NSE Nifty closed at 1,101 (up 4 points). The rupee was trading at Rs 48.96 per US dollar.
There was selective buying interest in auto stocks. M&M (3.8%), Punjab Tractors (1.5%) and Bajaj Auto (BJAT.BO, news) (0.2%) were in the positive territory. Expectations of a better sales performance in the coming fiscal seem to be aiding the rally. But TVS, LML and Hero Honda (HROH.BO, news) were out of favour.
Barring Syndicate Bank (2.7%), most of the other public sector banks were up. The scenario was similar in private sector banking stocks also. Gainers list included ICICI Bank (ICBK.BO, news) that is in talks with FleetBoston Financial, US, to sell a part of the 16% stake held by ICICI (ICIC.BO, news) in the Bank. Fleet Boston is the seventh largest financial holding company in the US. ICICI Bank closed the day up by 0.8% and ICICI gained 0.5%.
FMCG stocks were in favour during the day's trading. The lists of gainers included Marico (4.6%), Reckitt (0.3%) and ITC (ITCd.BO, news) . Nestle (0.8%) has been moving up ever since its 1QFY03 results were declared. Index heavyweight HLL also gained by 0.5% today.
Indian Rayon (IRYN.BO, news) has posted a 37% fall in net profits for the full year ended March 31, 2002. One of the key reasons for this sharp fall in profits could be on account of strike in its rayon division, which lasted for more than 2 months. The company actually posted a 73% fall in profits in 3QFY02. However, the stock was up 6.6%.
Barring IOC, Engineers India and MTNL (MTNL.BO, news) , PSUs were in the limelight. The government is expected to announce divestment of IPCL in the coming weeks. The gainers list included IPCL (4.9%), HPCL (1.8%) and BPCL (1.4%).
Many companies from the Tata Group were also in the limelight. The list included Telco, Tisco, Trent (TREN.BO, news) and Tata Tea (TTTE.BO, news) . Tata Tea has been gaining ground on the back of expectations of improved performance from the company in the coming fiscal. While there seems to be no definite signs of a recovery in tea prices in the near-term, the company's debt restructuring initiatives could be helping the stock price. Telco (2.4%)has targeted to boost its exports by 15% in FY03 to over 13,500 vehicles worth Rs 6.9 bn following a good demand of the small car 'Indica' in the overseas markets. The improvement in Tisco's price is largely on the back of improved realisations for the steel sector. The stock closed up by (3.7%).
Among the technology stocks, buying interest was concentrated on second rung stocks like Digital, Polaris and Mphasis BFL. GTL (3.7%) and Digital (6%) saw significant volumes. Digital touched a 52-week high once again. While hopes of an acquisition by Polaris in the near future could be driving the optimism, buying in Mphasis seems based on the future growth prospects of its call centre subsidiary MsourcE. Top rung stocks like Infosys (1%), Satyam (1%) and HCL (HCLL.BO, news) Technologies (0.3%) closed in the red.
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