Business Daily from THE HINDU group of publications
Tuesday, Jul 11, 2006
Business Daily from THE HINDU group of publications Tuesday, Jul 11, 2006 |
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Stock Markets Markets - Commentary Columns - Sensor Nath Balakrishnan
Pointers Market breadth negative Sharp drop in turnover Tech stocks rule firm
After a fall of over 400 points over the last two days of the previous trading week, the markets staged a recovery on Monday. Positive cues included strength in other key Asian markets, a cooling off in the prices of crude, and expectations of a strong corporate performance in the forthcoming results season. The Sensex rose 174.7 points to finish the day at 10,684.3. The Nifty gained 66.1 points to end the day at 3142. Technology stocks ruled firm. After logging gains of about 100 points in afternoon trade, the Sensex gave up all gains with about an hour-and-a-half of trading left. It took off from there to finish the trading session on a strong note. However, the underlying fundamentals did suggest weakness: declines outstripped advances by a ratio of 13:10 and trading value was a good 30 per cent lower than the Rs 3,200 crore clocked on Friday. On the NSE, turnover, at about Rs 4,800 crore, was the lowest since April 29 (excluding June 25, when markets were open for a short while).
Index movements
Within the Sensex, all but three stocks ended in positive territory. The spotlight was on technology stocks, all of which ended the day with strong gains. The key event to watch out for would be the results announcement of bellwether Infosys on Wednesday. The numbers usually set the tone of what can be expected from the other stocks within the tech space. Cement sector stocks also had a robust outing, with Gujarat Ambuja, ACC and Grasim registering impressive gains. With pricing power having swung producers' way, the street is probably expecting stocks in the sector to come up with a solid showing. Other prominent gainers on the Sensex were Bharti Airtel and Maruti. Bharti gained Rs 19 to end at Rs 389.65, after it registered an impressive addition to the subscriber base for June. Maruti, which announced a tie-up with M&M Financial for providing rural vehicle finance, ended at Rs 805.35, gaining about Rs 25 in the process. HDFC Bank was hit negatively after a news report that the NSE would not accept fresh guarantees it would issue to brokers. The stock shed close to Rs 6 and ended at Rs 778.85.
Stock-specific action
Hindustan Zinc gained close to five per cent to finish at Rs 603.45 after it announced its second rice hike in July. It raised zinc rates by one per cent and lead rates by sixty basis points.
Stock to watch
Centurion Bank of Punjab, which declared its quarterly numbers after markets closed, could be in the spotlight, as its earnings have more than doubled compared to the year-ago period.
Other gainers/losers
Eicher Motors, Ajanta Pharma, Hyderabad Industries, Venky's India, and Ansal Housing, were a few other stocks with sharp gains. Prominent losers included LMW, BF Utilities, Aventis Pharma, Monsanto and Sesa Goa.
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