Post Market Commentary, 7-April-08

Banking, FMCG stocks lead 414-point Sensex surge

The 30-share BSE surged 413.96 points or 2.7% at 15,757.08. At the day’s high of 15,851.88, the Sensex rose 508.76 points in mid-afternoon trade. At the day’s low of 15,321.56 Sensex lost 21.56 points in early trade.

S&P CNX Nifty was up 114.2 points or 2.46% at 4,761.20.

Asian stocks nudged higher today, 7 April 2008, as a worse-than-expected US payrolls data on Friday, 4 April 2008, which showed a fall of 80,000 jobs in March 2008, raised expectations of further interest rate cut by the US Federal Reserve. Key benchmark indices in Hong Kong, China, Japan, Singapore, South Korea, and Taiwan were up by between 0.4% to 4.45%.

Meanwhile, Securities and Exchange Board of India (Sebi) chairman C.B. Bhave today said the Sebi will hold a meeting with foreign funds and their custodians to discuss issues regarding the proposed margins imposed on institutional investors. Sebi had said last month that institutional investors will be required to pay a margin on trades executed in the cash market by the next day, effective from 21 April 2008.

As per the provisional figures on NSE, the foreign institutional investors (FII)s bought shares worth Rs 346.04 crore today 7 April 2008 and domestic funds bought shares worth Rs 245.93 crore.

The market breadth was strong: on BSE 1556 shares advanced as compared to 1071 that declined. 57 shares remained unchanged.

Banking stocks galloped. ICICI Bank (up 5.97% to Rs 809.30), State Bank of India (up 4.24% to Rs 1,673.35) and HDFC Bank (up 0.85% to Rs 1,303.10) edged higher.

FMCG stocks spurted. United Spirits (up 4.34% to Rs 1,655.15), ITC (up 4.73% to Rs 210.30) and Hindustan Unilever (up 4.74% to Rs 253) edged higher.

IT stocks rose. India’s largest IT services exporter by sales Tata Consultancy Services rose 3.44% to Rs 900.10. The company has signed a new multi-year contract with Chrysler LLC to provide a comprehensive portfolio of IT services. Wipro (up 4.42% to Rs 433.95), Satyam Computer Services (up 1.62% to Rs 432.15) and Infosys (up 0.63% to Rs 1492.20) edged higher.

Reliance Industries rose 3.6% to Rs 2,405.70. As per reports, Reliance Industries is planning to enter into the rig manufacturing business besides investing $2.5 billion to enter into petrocoke gasification.

Reliance Communications rose 1.17% to Rs 506. It has reportedly formed a joint venture with a local firm to launch GSM mobile services in Sri Lanka by this year.

ONGC rose 1.19% to Rs 1,017.85.ONGC Videsh (OVL), the overseas arm of Oil and Natural Gas Corporations (ONGC), will reportedly sign an agreement on 8 April 2008 to take a 40% stake in the San Cristobal oilfield in Venezuela. OVL will make a total investment of $355.7 million comprising signature bonus of $173.1 million for the stake, the reports added.