Nearing 6,500!

After the weakness that was witnessed in the holiday-shortened last week, the Indian indices have opened this week on a firm footing. With most of the index heavyweights lending support and buying being witnessed across sectors, the Sensex has once again breached the 6,500 levels and is trading near the same currently.

The BSE Sensex is at 6,490 (up 47 points) and the NSE Nifty is at 2,028 (up 13 points). The rupee is trading at 43.80 to the dollar.

Index heavyweights are witnessing strong buying interest currently and major gainers from among the Nifty stocks include HDFC Bank (HDBK.BO, news) (3%), Colgate (2%) and Tisco (1%). Leading cement producer, Gujarat Ambuja is also witnessing buying interest and is up around 1% currently. A leading business daily has reported that the company is planning a capital expenditure of Rs 20 bn over the next three years to hike its capacity to 20 million tonnes per annum (MTPA), from the current levels of 14 MTPA. In our recent interaction with the management of the company, it had indicated that the expansion is likely to be funded from internal accruals. The expansion plans follow the government's stress on infrastructure and housing development in the country and are likely to be beneficial for cement companies like Gujarat Ambuja.

Dragged by worries related to rising oil prices and inflation, the US markets closed the holiday-shortened last week on a mixed note. While the Dow closed with 0.1% losses, the NASDAQ ended marginally up. This was the third straight week of poor show from the US markets. The overall mood remained dampened on the back of the signals emanating from the Fed that seemingly hinted at the speeding up of US interest rate hikes in order to counter the inflationary pressures.

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