Market Close: 21k touched but..Couldn't sustain?

Strong global cues sees firm and banging start as Sensex hits 21k and Nifty made all time high in opening trade. However, indices could not sustain the highs and immediately fell into negative teritorry. Markets continued to trade extremely volatile; there was no clear direction where the indices were heading and juggled on both the sides. But, value buying at lower levels emerged as profit booking at high levels. However, buying at late session helped the indices to recover and end flat. Asian markets ended mixed, European markets trading in green.

Profit booking was seen in all the sectors except IT and selective stocks in sugar. Metals and Capital Goods were hit badly. Mid and small caps which had been outperformer for so many sessions, today were hammered. The both the index hit badly, ended down by 3%.

Sensex ended up by 61 points at 20873.33. It was helped up by gains in Bharti Tele (974.15,+4 percent), HDFC Bk (1716.3,+4 percent), Satyam (424.5,+3 percent), SBI (2465.25,+3 percent) and RCVL (804.3,+2 percent). Restricting the gains are Hindalco (208.95,-4 percent), TISCO (891.8,-4 percent), Grasim (3400.6001,-3 percent), Maruti (939.65,-2 percent) and ICICI Bk (1333.5,-2 percent).

Domestic car sales managed to beat the year-end blues in December 2007 registering an 8.8% growth while bike sales skid by 11.4% for the two-wheeler industry. Car market leader Maruti Suzuki India managed to increase sales by 4.5% to 50,056 units in December against 47,877 units in the corresponding period a year ago. Rivals Hyundai registered a growth of up 18.2% at 13,069 units, compared to 11,049 in the year-ago period, while Tata Motors witnessed a fall of 14% at 10,876 units, against 12,672 units in the same month in 2006. General Motors more than tripled its sales during the month at 4,130 units, compared to 1,064 in December 2006, thanks to heavy discounts offered on its hatchback 'Spark'. On the motorcycle front, the down-slide continued with all the top three manufacturers, Hero Honda, Bajaj Auto and TVS registering negative growths in December 2007. However, the auto stocks ended in deep red.

ABG Shipyard Ltd reported impressive results for the third quarter December 2007. The top line grew by 55% to Rs 275 cr and the bottom line grew by 61% to Rs 47 cr. The Ebidta profit grew by 55% to Rs 82 cr from Rs 53 cr on yoy basis. The company has been able to maintain the Ebidta margins at 30%, and has received Rs 17 cr in quarter as subsidy. The company imports 50-60% of raw material required, the appreciating rupee will be benefited. The major raw material is steel; the increase in prices of steel will impact on company?s margins. It has also planed to convert new facility at Dahej to SEZ. This may give some relief to the company if subsidy discontinued. ABG has main advantage of employee cost; it has appointed most of the employees on contract basis, this helps the company to save the fixed cost. The valuations are not compelling at this point of time; the business scenario is extremely good. Read our report here to get more calrity and ther will be a result analysis here too.

Technically Speaking: It was extremely volatile session with no clear direction, Sensex traded on both the sides without direction and ended with small gains. Sensex touched intraday high of 21,078 and low of 20,697. Overall breadth was in favor of Declines, where the Advances stood at 541, while Declines at 2371. The turnover was good at Rs 11,580 cr. Sensex support lies at 20,530 and resistance lies at 20,950 levels.