Side counters hog limelight in range bound market

The market settled with marginal gains in volatile session. Volatility was witnessed in late trade. There has been a lack of direction on the bourses since the past few trading sessions due to absence of any trigger. Shares from consumer durables sector surged, while IT stocks saw some unwinding in late trade, after opening firm.

The 30-shares BSE Sensex posted marginal gain of 13.36 points or 0.09% to 14,501.08. It opened slightly lower at 14,478.75 tracking weak global markets. It was also Sensex's low of the day. From here, the index advanced to strike a high of 14,560.48 at 13:11 IST. Sensex swung just 82 points today, between a low of 14,478.75 and high of 14,560.48.

BSE Sensex is 222 points away from its all-time of 14,723.88, which it had hit on 9 February 2007.

The S&P CNX Nifty rose 26.30 points or 0.62% at 4,285.70. The Nifty June 2007 futures settled at 4272.20, a discount of 13.50 points as compared to spot closing

Gains in some of the heavyweights in Nifty helped Nifty score over Sensex today. ONGC rose 2.1% to Rs 935.90, Bharti Airtel gained 2% to Rs 850 and Bhel rose 1.4% to Rs 1470.75. These three stocks have a combined weightage of 19.44% in Nifty. The combined weightage of these three stocks in Sensex is lower at 12.93%.

There was a plenty of action outside index stocks, indicated by healthy market breadth. On BSE, 1503 shares advanced as compared to 1126 that declined, while 80 remained unchanged.

The BSE Mid-Cap index struck all time high of 6,435.32. It rose 33.71 points or 0.53% to 6,417.90. The BSE Mid-Cap index has witnessed a solid surge over the past few months.

The BSE Small-Cap index settled with a gain of 41 points or 0.54% to 7,604.72. It is 268 points away from its all-time of 7,872.80 that it had hit on 11 May 2006.

The total turnover on BSE amounted to Rs 4,677 crore as compared to Rs 4,316 crore on 25 June 2007. Turnover surged to Rs 52,571.16 crore in NSE's F&O segment as compared to Rs 40264.20 crore on 25 June 2007.

Among the Sensex pack, 16 advanced while the rest declined.

State run oil exploration major Oil & Natural Gas Corporation (ONGC) gained 2.45% to Rs 939.10, on 2.96 lakh shares. It was the top gainer from the Sensex pack. ONGC posted 13% fall in net profit to Rs 2681.64 crore in Q4 March 2007 compared to a net profit of 3085.89 crore in Q4 March 2006. Total income rose 16.35% to Rs 14575.92 crore in Q4 March 2007 (Rs 12528.23 crore). The results were announced during trading hours on Monday, 25 June 2007.

Led by heavyweight ONGC, the BSE Oil and Gas Index rose 0.6% to 7,658.34.

Telecom services provider Bharti Airtel rose 1.89% to Rs 849, on 2.46 lakh shares as buying continued after HSBC Holdings Plc., recently raised price target of India’s top wireless services company by 9%, and said that the company will continue to expand market share. The one-year target was raised to Rs 1110.

State run engineering major Bharat Heavy Electricals (BHEL) gained 1.35% to Rs 1470. The company won an order worth Rs 106 crore from Rashtriya Ispat Nigam (RINL). The announcement of the order win was made during market hours on Monday, 25 June 2007. The contract will be executed in 28 months.

The BSE Capital Goods Index rose 1.01% at 11,949.91. Suzlon Energy (up 5.16% to Rs 1431.10), Crompton Greaves (up 4.37% to Rs 253), Bharat Bijlee (up 3.98% to Rs 2260), Praj Industries (up 4.21% to Rs 488.70), and Areva T&D (up 3.86% to Rs 1495), edged higher from Capital Goods index.

IT stocks which were trading firm till mid-afternoon session, pared gains later. The BSE IT Index lost 0.25% at 4,799.99. Satyam Computers rose 0.86% to Rs 457, while TCS (down 0.22% to Rs 1123), Infosys Technologies (down 0.50% to Rs 1926.10), and Wipro (down 1.18% to Rs 509) edged lower.

The Indian rupee started at its lowest level in more than two weeks on Tuesday, 26 June 2007, as investors anticipated an abatement in capital inflows on shrinking global risk appetite and a step-up in dollar purchases by oil refiners. In early trade, the rupee was at 41.01/02 per dollar, slipping from Monday's (25 June 2007) 40.875/885.

Index heavyweight Reliance Industries (RIL) slipped 0.35% to Rs 1,700, on 5.56 lakh shares. It had struck a high of Rs 1719.40. As per reports, the Prime Minister's Office (PMO) has referred the issue of pricing natural gas found off the east coast to a committee of secretaries. The move comes in the wake of differences the petroleum ministry has with the power and fertiliser ministries over the methodology adopted for arriving at the gas price.

Pharma major Ranbaxy Laboratories lost 2.40% to Rs 347.50, on 3.13 lakh shares. It was the top loser from the Sensex pack. Goldshield become the latest in a string of companies to pay millions of pounds in out-of-court settlements to the NHS for alleged drug price-fixing. Goldshield's settlement follows April's announcement from the UK's Serious Fraud Office that it intended to charge nine people and five companies with conspiracy to defraud the NHS over certain drug prices and supply. Ranbaxy is one of the 5 companies allegedly involved in a cartel that took place between 1996 and 2000.

Cement stocks Ambuja Cements (down 0.68% to Rs 116.45) and ACC (down 1.27% to Rs 845.25), edged lower on profit booking

Housing finance major HDFC lost 1.27% to Rs 1880, on reports that it has cut floating rates for new home loans by 25 basis points as part of monsoon offer

ICICI Bank continued to shed value since the Foreign Investment Promotion Board (FIPB) on Monday, 25 June 2007, rejected ICICI Bank’s proposal to divest 24% stake in ICICI Financial Services in favour of foreign investors as a subsidiary could not take part in insurance business. It lost 0.70% to Rs 945.10.

The BSE Bankex was down 0.35% at 7,802.33, and was the top loser among the sectoral indices on BSE. Canara Bank (down 2.99% to Rs 255.95), UTI Bank (down 2.98% to Rs 598.20), Federal Bank (down 2.50% to Rs 290.10) and Union Bank of India (down 1.50% to Rs 131.20), were some of losers from the banking pack.

Entertainment Network India (ENIL) jumped 20% to Rs 506.60, on 5.72 lakh shares. Novartis India (up 14.90% to Rs 400), Nicco Corporation (up 19.86% to Rs 33.50), Valecha Engineering (up 10% to Rs 269.40), Kalindee Rail Nirman Engineers (up 10% to Rs 254), and Honeywell Automation (up 9.80% to Rs 2060), surged from small-cap and mid-cap space.

Kothari Products rose 2.85% to Rs 555 after 16.9 lakh shares changed hands in block deals on the BSE at an average price of Rs 541.41 each. The scrip touched a high of Rs 585 and low of Rs 540 during the day. The stock had average daily volume of 7,313 shares on BSE in past one quarter. The block deals, amounting to 25.5% of its equity capital, constituted transfer of stake between promoters. As per recent media reports, Deepak Kothari intends to increase his stake to 46.02% in the company by purchasing the stake from M.M. Kothari and Sharda Kothari.

Shares from the consumer durables sector were in demand. The BSE Consumer Durables index surged 2.71% to 4,163.86, and was the top gainer among the sectoral indices on BSE. Titan Industries (up 8.78% to Rs 1279.30), Lloyd Electric (up 1.91% to Rs 155), and Rajesh Exports (up 0.52% to Rs 525.15), were the major gainers from BSE Consumer Durables index.

Steel stocks gained in anticipation of further consolidation of steel industry globally. Tata Steel (up 0.42% to Rs 602), Sail (up 0.83% to Rs 133.40) and Bhushan Steel (up 0.11% to Rs 703), gained. As per reports, Arcelor Mittal and Nippon Steel Corporation will ink a new partnership agreement next month on technology transfer and capacity expansion at their joint ventures. The two firms have been talking about the pact since last July after Mittal bought Arcelor, Nippon's strategic partner in Europe, in an unfriendly bid to create the world's biggest steel maker.

GMR Infrastructure rose 6.49% to Rs 691.95 and came fourth among top gainers in A group. As per recent reports, the GMR group is planning to invest in infrastructure private equity (PE) funds. The company has got proposals from several PE funds to invest in them, reports stated.

Ciba Specialty Chemicals (India) slumped 3.95% to Rs 382.50 even as it notched up 68.75% rise in net profit in Q4 March 2007 to Rs 5.40 crore as against Rs 3.20 crore in Q4 March 2006. Sales declined 36.81% to Rs 100.10 crore in Q4 March 2007 (Rs 158.40 crore). The net profit jumped 142.81% to Rs 81.10 crore in the year ended March 2007 (FY 2007) as against Rs 33.40 crore in the year ended March 2006 (FY 2006). Sales declined 18.24% to Rs 510.20 crore in FY 2007 (Rs 624.00 crore). The results were announced after the market hours on Monday, 25 June 2007.

Jet Airways India rose 0.16% to Rs 804.25 after it reported 61.25% a fall in net profit in Q4 March 2007 to Rs 88.01 crore as compared to Rs 227.12 crore in Q4 March 2006. Total income rose 1.99% to Rs 1989.03 crore in Q4 March 2007 from Rs 1950.19 crore in Q4 March 2006. Net profit declined 93.82% to Rs 27.94 crore in the year ended March 2007 compared to Rs 452.04 crore for the year ended March 2006. Total income rose 21.58% to Rs 7401.31 crore in FY 2007 from Rs 6087.57 crore in FY 2006

Great Eastern Shipping declined 3.13% to Rs 337 after its board approved issue of 50 lakh warrants convertible into shares at Rs 312.75 each to promoters and directors. The conversion price of warrants of Rs 312.75, is 7.1% discount to current market price of Rs 337. If the entire warrants are converted into equity shares, it will result into 3.2% equity dilution. The promoters hold 29.30% stake as on March 2007.

Dollex Industries was locked at the 5% upper circuit of Rs 142.05, after the company said it bagged an order worth $5 million to supply liquor to Africa. The time-frame for the order is 6 months. Once the order is successfully executed, the company plans to enter into a joint venture with this buyer and expects to cross its export target of IMFL up to 1200 containers in this year alone.

Cairn India advanced 4.17% to Rs 143.50 on reports that the government has agreed to company’s proposal to lay a pre-heated 580 kilo metre pipeline at a cost of Rs 2400 crore to transport the crude oil from its Barmer oil fields in Rajasthan to Virangam in Gujarat.

The cost of laying the pipeline is to be shared between Cairn and Oil and Natural Gas Corporation (ONGC) in a 70:30 ratio, the same as the shareholding in the oil field, laying to rest a contentious issue between the government and Cairn. Petroleum Minister Murli Deora is expected to announce the decision shortly, reports suggest.

Esab India declined 2.27% to Rs 449.90 on reports of London based Charter making an open offer for acquiring 20% stake to the shareholders of Esab India at Rs 426 per share. According to Esab India's shareholding pattern as of 31 March 2007, Charter holds 57,43,200 shares amounting to 37.31% in the company through a subsidiary, Esab Holdings. With this offer, Charter's shareholding in Esab India would increase to 57.3%, subject to the regulatory approvals.

Wearology was locked at the 5% upper circuit of Rs 263.15 after foreign fund Merrill Lynch Capital Markets Espana bought 5.7% stake or 2.9 lakh shares in the company in a block deal at Rs 250 per share on BSE on Monday, 25 June 2007.

Britannia Industries slipped 0.86% to Rs 1520, after striking a high of Rs 1594.95, on reports that Groupe Danone, an equal partner in Indian biscuit major Britannia Industries, may sell its 25.5% stake in the company to an outsider.

NIIT spurted 4.70% to Rs 988.10 after it tied up with Intel Corporation to develop a multi-core training curriculum. NIIT, in association with its training partners, will offer the Intel multi-core training curriculum to the software developer community, globally.

Suraj Stainless plunged 5% to Rs 342.70, even after its board recommended a liberal 2:1 bonus. The company made the announcement during trading hours today, 26 June 2007.

Natco Pharma rose 5.45% to Rs 146 after the drug maker said it got US Food and Drug Administration approval to market its ondansetron hydrochloride tablets in the United States. Ondansetron tablets are used to treat nausea and vomiting caused by cancer treatments. The company also stated that it is in process of establishing a retail chain in the US and hopes that the chain would serve a useful purpose in distributing and marketing its approved products there.

Gabriel India galloped 4.76% to Rs 27.55 after the auto parts maker said it plans to close its loss-making plant in Noida, near Delhi. The company made the announcement after market hours on Monday, 25 June 2007.

Asian markets were in the red. Japan’s Nikkei 225 index declined on losses in exporters such as Sony Corp. and Canon Inc., while food stocks such as Ajinomoto Co. edged higher. Nikkei was down 21.37 points at 18,066.11. Taiwan's Taiwan Weighted (down 0.82% at 8,865.75), Singapore's Straits Times (down 1.54% at 3,525.10), Hang Seng (down 0.09% at 21,803.57), South Korea's Seoul Composite (down 0.47% at 1,749.55) all edged lower.

China’s Shanghai Composite gained 0.82% to 3,973.31

All the European markets were trading lower.

US markets gave up a big advance and turned lower yesterday, 25 June 2007, as investors suffered a renewed case of the jitters ahead of the Federal Reserve’s meeting on interest rates later this week. The Dow Jones industrial average fell 8.21 points, or 0.06%, to 13,352.05, after rising more than 100 points earlier in the day. Broader indices also declined. The Standard & Poor's 500 index fell 4.82 points, or 0.32%, to 1,497.74, and the Nasdaq Composite lost 11.88 points, or 0.46%, to 2,577.08.

Volatility is likely to be high on the bourses in the short term ahead of expiry of June 2007 derivatives contracts on Thursday, 28 June 2007. As is the case at the time of expiry of near-month contracts, the extent of rollover to July 2007 contracts from June 2007 contracts will dictate the trend in the near term. A higher rollover indicates that the market players expect bourses to remain firm in the month ahead and vice versa.

Over the next few months, the progress of the July-September monsoon will hold key. The weather office said in April 2007 that this year’s monsoon was likely to be 95% of the long-term average, with a 5% margin of error. The annual monsoon is vital for India’s economic health as it is the main source of water for agriculture, which generates more than a fifth of the gross domestic product

Crude oil prices reversed early weakness to gain 4 cents to $69.18 today, 26 June 2007, following news that a number of oil companies have reportedly refused Venezuela's terms on major oil projects.