Thursday April 5, 02:30 PM
Breaking fresh grounds... |
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By Equitymaster.com
Overcoming stiff resistance, bulls have entered newer territories for the day and have edged higher during the previous hour of trade. While buying activity is being witnessed across all sectors, select auto and power stocks are out of favour. The advance to decline ratio is 2.2:1 on the NSE.
The BSE Sensex is trading at 12,878 (up 91 points) while the NSE Nifty is trading at 3,765 (up 32 points). The rupee is trading at 43.14 to the dollar.
Oil stocks are trading firm with IGL (up 2%) GAIL (GAIL.BO, news) and HPCL (each up 1%) being the key gainers. The Planning Commission has asked the Ministry of Petroleum and Natural Gas to limit the refining capacity additions because the domestic market is saturated and the infrastructure to export petroleum products is not yet well established. There could be saturation in the export markets too. Moreover, once the domestic gas comes in, there is bound to be some displacement of liquid fuels like petrol, diesel and LPG. This warning from the planning body could, therefore, impact PSU more than private players as private sector entrepreneurs do not need a licence to set up new refineries and the government-owned companies need to get their plans cleared by the Cabinet. According to estimates by 2012, India's refining capacity will go up to 241 mmtpa. Most of the new capacity is targeted at the export market.
Power stocks are trading a mixed bag with Reliance (RELI.BO, news) Energy (up 2%)being the key gainer, while NTPC (down 1%) is out of favour. The negative sentiment in NTPC could be the consequence of a rather lackluster FY07 performance by the company. The country's largest power generating utility has grown its topline by 17.2% in FY07 on a YoY basis while the bottomline grew at a lower rate of 15.6% YoY. While prima facie, the results look rather lackluster, the real reasons would be known once the detailed results are out.
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