Tuesday April 10, 03:30 PM
Bulls pocket a thriller! |
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By Equitymaster.com
The final trading hour saw the markets close barely into the positive as buying activity intensified among index heavyweights. While FMCG, telecom and cement stocks garnered investor interest, profit booking took its toll on software stocks. As regards global markets, while the Asian indices closed a mixed bag, the European indices are trading firm currently.
The BSE Sensex closed at 13,190 (up 12 points) while the NSE Nifty closed at 3,848 (up 4 points). The rupee was trading at 42.85 to the dollar.
Weakness plagued most of today's trading session. The opening was barely above yesterday's levels and from thereon the bears took control pushing the indices below the dotted line. Each successive trading hour was witness to the markets making further inroads into the red. However, buying activity at the lower levels led the indices to close marginally above the dotted line in the final trading hour. The overall market breadth was positive with gainers edging out losers by a ratio of 1.5 to 1 on the Sensex. While Satyam and Wipro (each down 3%) emerged as the top losers on the Sensex today, HDFC (up 4%) and ITC (3%) managed to buck the trend.
Automobile stocks closed mixed today. While LML (10%), Escorts (6%) and Tata Motors (2%) led the pack of gainers, M&M and Maruti (each down 1%) closed into the red. According to a leading business daily, Bajaj Auto (BJAT.BO, news) on Monday inaugurated its Uttarakhand plant that has a planned capacity of 1 m motorcycles per annum, which the company targets to achieve by October 2007. Bajaj Auto has set up the Rs 7 bn plant with an investment of Rs 1.5 bn and the remaining has been funded by its 16 vendors. The company will initially manufacture the 100cc bike - Platina - with new rollouts in the executive segment being planned by the second quarter of the current fiscal. The company desires to shift its customers from the 100cc segment to a new segment by introducing bikes that have a higher power but are priced close to the 100cc segment bikes. The company also announced its plans to foray into the four-wheeler cargo segment with a launch being planned for 2009. The stock closed 1% lower.
Engineering stocks closed a mixed bag. While BHEL (up 2%) and ABB (1%) found favour, Voltas (VOLTd.BO, news) and L&T (each down 1%) closed weak. As reported, Suzlon Energy has raised its takeover offer for Germany's REpower Systems AG to 150 euros per share, topping an offer from France's Areva. Suzlon, the world's fifth-largest wind turbine maker, revised its offer after a subsidiary bought 7.7% in REpower at 150 euros per share. Suzlon's revised offer values the German firm at around 1.2 bn euros (US$ 1.7 bn). Suzlon has teamed up with Martifer, a unit of Portugal's largest builder Mota Engil, for its bid. Martifer owns about 25% of REpower. While the acquisition, if successful, will provide Suzlon with strategic advantages over the long term, especially in terms of access to the world's largest market in installed capacity and superior R&D technology, we remain cautious on the price paid and imminent dangers that it could pose to Suzlon's balance sheet. The stock closed marginally higher.
Telecom stocks closed firm today with VSNL (2%) and Reliance (RELI.BO, news) Communication (1%) being the major gainers. As per an announcement from Reliance Communication (RCom), the company has added a net of over 1.2 m customers for the month of March 2007, thereby taking its total subscriber base in excess of 30 m. The company has also completed its re-verification exercise (as was stipulated by Department of Telecommunication) for about 85% of its subscriber base. The company has also reported that the de-activated customers had not contributed much to its revenues and as a result they will not materially impact the company's revenues or profitability. In fact, owing to the deactivation of these customers, the company expects a 12% increase in its ARPUs as revenues will now be divided over a smaller subscriber base.
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