Monday March 12, 11:30 AM
Slipping down... |
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By Equitymaster.com
The BSE Sensex pared some of its early morning gains during the previous hour of trade, while the NSE Nifty chartered into the negative territory. Engineering, software, banking and auto sector stocks are currently garnering investor favour. However, select stocks in the petrochemicals and telecom sector are witness to selling pressure. The overall market breadth continues to remain positive with the advance to decline ratio poised at 3.4 to 1 on the NSE.
The BSE Sensex is trading at 12,977 (up 92 points) while the NSE Nifty is trading at 3,753 (down 9 points). The rupee is trading at 44.09 to the dollar.
Stocks in the sugar sector are trading higher with Dhampur Sugar (DAMSd.BO, news) and Bajaj Hindustan (up 4% each), Balrampur Chini and E.I.D. Parry (up 3% each) being the major gainers. According to a leading business daily, the Central government is set to announce a Rs 7.5 bn bail-out package for the sugar industry before the end of this month. Of this sum, about Rs 3.5 bn are to be provided for creating a buffer stock of sugar of 1.2 m tonnes and the balance of Rs 4.0 bn will be utilised towards export subsidiary when there is a low demand for sugar overseas. The bailout comes as a much sought relief to the sugar companies as the sugar realisations have taken a hit during the past few months and India is expecting a record production of 24 m to 26 m tonnes, which is not likely to allow the prices to recover in the near future. The bail-out will help to reduce the operating cost of the companies as the government provides for reimbursement of expenses on internal transport, ocean freight, and handling expenditure through the subsidiary, which will help boost the profitability of the Indian sugar companies.
Telecom stocks are trading higher with Bharti Airtel, VSNL and MTNL (up 1% each) being the major gainers. According to a leading business daily, Bharti Airtel has planned a capital investment of US$ 8 bn by the year 2010. The company has been spending nearly US$ 2 bn per annum over the past few years and by this announcement has proposed to continue doing so in the medium term as well. The company plans to add about 20,000 base stations by the end of FY08 and another 30,000 by the end of FY09. The company is targeting to increase its subscriber base by nearly fourfold to 125 m subscribers by the end of FY10 from its current base of 35 m (as on February 2007).
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