3 on 3!

Markets maintained their gains in the final hour of trade, closing in the positive for the third straight trading session. Apart from buying in technology and other heavyweights, interest in key stocks from the auto, banking, pharma, FMCG and energy sectors aided the northward movement of the indices.

The BSE Sensex closed at 6,345 (up 46 points) and the Nifty closed at 1,966 (up 18 points). The rupee was trading at Rs 43.74 per US Dollar.

Carrying on from where they had left yesterday, the markets opened today in the positive territory. However, profit booking soon set in and the indices dropped nearly to their yesterday's closing levels. Bargain hunting at lower levels and, specifically, strong buying in technology counters, however, led to the markets gaining momentum that was carried till the close of trade. Volatility was, however, pretty high today. Among the Sensex stocks, while major gainers included Wipro (6%), Infosys (3%) and ICICI Bank (ICBK.BO, news) (3%), selling was seen in Ranbaxy (3%), Tisco (2%) and Hero Honda (HROH.BO, news) (2%).

Despite the overall positive sentiment, stocks from the power sector closed today on a weak note and major losers included Neyveli Lignite, Tata Power (TTPW.BO, news) (both 1% down) and NTPC (down marginally). Selling in these stocks was seemingly a result of newspaper reports that the Indian power industry is on its way of failing to meet the generation capacity addition plans it had set earlier for the 10th (2002-07) and 11th (2007-12) five year plans. As per the report, the sector, which was projected to add around 100,000 megawatt (MW) of generation capacity by 2012 to achieve the 'power for all' objective, is likely to fall way behind the target. This is bad news as power plays the utmost role in growth of any economy, more so for a developing economy like ours that continues to suffer on account of power deficits.

After the past few days of hammering on account of poor guidance and results respectively from Infosys and TCS, there was finally some reasons to cheer for investors in technology stocks as Wipro announced strong FY05 results today. While the stock closed with nearly 6% gains today, buying was also seen in Infosys, Satyam and TCS (each 2% up). Earlier today, Wipro (WIPRd.BO, news) , India's third largest software services exporter reported strong results for fiscal FY05, While topline has grown by 40% YoY, bottomline has clocked a 58% YoY growth. The company has also managed to improve its operating margins by 330 basis points for the fiscal, mainly owing to a less than proportionate increase on the expenditure front. Wipro's Global IT services segment (74% of consolidated revenues) continues to guide the topline growth for the company. In 4QFY05, revenues from the segment have grown sequentially by 3.4%, aided mainly by an 8.5% increase in volumes. A 2.9% decline in onsite billing rates and 3% appreciation of the rupee against the dollar has, however, constrained the growth.

Banking stocks also closed on a strong note and major gainers included Kotak Bank (7%), ING Vysya Bank (4%) and ICICI Bank (3%). UTI Bank closed with 1% gains. The company had announced subdued results late yesterday, wherein it posted a 33% YoY growth in bottomline for 4QFY05 as compared to the 60% growth witnessed in 3QFY05. Despite 67% YoY growth in credit, the bank has posted operating margins of barely 6.1% for 4QFY05. The growth in margins is primarily subdued due to the rise in interest expenses and operating expenses. The contribution from the other income side continues to be generous with the bank capitalizing on fee-based revenues (97% YoY).

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