Thursday Closing Report: Not out of the woods yet

Refreshed after a day's break, the local market opened in the green this morning tracking the regional bourses that were on a positive note. The indices managed to close with marginal gains amid a volatile session.

The market opened on a positive note tracking supportive cues from the bourses across the Asian region. The early surge was aided by capital goods, power and metal stocks. Investors lost no time in taking profits off the table, sending the indices to the day's low in the mid-morning session. The 2% easing in food inflation numbers perked up the indices once again lifting the bourses into the green. However, a fair bit of choppiness saw the market popping in and out of the negative terrain.

The Sensex ended 65.50 points (0.33%) higher at 19,930. The index touched a high of 20,056 and a low of 19,615, intraday. The Nifty settled 10.10 points (0.17%) higher at 5,998, within kissing distance of the 6,000 mark. The benchmark touched a high of 6,076 and a low of 5,906 today.

The market breadth tilted in favour of the advancers today. The Sensex closed with 19 gainers and 11 losers while the Nifty had 31 advancers against 19 declining stocks at the end of the session. Bucking the trend, the broader indices ended lower today; the BSE Mid-cap settled 0.30% lower while the BSE Small-cap index tanked 1.06%.

The top gainers on the Sensex included Hero Honda (up 5.46%), Hindalco Industries (up 4.86%), Cipla (up 4.38%), Bharti Airtel (up 3.77%) and Tata Steel (up 2.98%). The laggards on the index were Reliance Communications (down 4.88%), ICICI Bank (down 3.14%), Jindal Steel (down 1.73%), Tata Power (down 1.18%) and ONGC (down 1.17%).

BSE Metal (up 1.89%), BSE Auto (up 1.40%) and BSE Healthcare (up 0.97%) were the notable gainers in the sectoral space today. BSE Bankex (down 1.60%), BSE Consumer Durables (down 1.42%) and BSE Realty (down 0.77%) ended at the bottom of the list.

Food inflation fell sharply by 2 percentage points to 10.3% for the week ended 6th November from 12.3% in the previous week, raising hopes that overall inflation may decline to around 6% by the end of the year, as predicted by the government, reports PTI.

Inflation stood at 13.99% in the corresponding period last year. This is the first time in a long time that food inflation for a particular period was lower than the corresponding period of the previous fiscal.

The decline may prompt the Reserve Bank of India (RBI) to halt its monetary tightening drive to boost industrial growth, which had fallen to a 16-month low of 4.4% in September.

Markets in Asia ended mostly higher as investors resorted to bargain-hunting following the recent decline in the markets. The Chinese government's milder measures to curb rising prices and a fall in the value of the yen also improved investors' confidence.

The Shanghai Composite surged 0.94%, the Hang Seng jumped 1.82%, the Jakarta Composite added 0.11%, Nikkei soared 2.06%, the Straits Times rose 0.10%, the Seoul Composite advanced 1.62% and the Taiwan Weighted gained 0.34%. On the other hand, the KLSE Composite was down 0.46%.

In international news, Irish central bank Governor Patrick Honohan said he expects the country to go in for a bailout from the European Union (EU) and the International Monetary Fund (IMF) to rescue its beleaguered banks. Ireland is likely pay an interest rate of nearly 5%, similar to that offered to Greece when it requested a bailout in April.

EU, IMF and European Central Bank officials fly into Dublin today to study the books of the country's lenders as European policymakers put pressure on Ireland to accept a bailout to prevent contagion spreading through the euro area.

The US market witnessed a flat close overnight as the day's economic data fuelled speculations that the Fed would continue to prop the sagging economy. The consumer-price index rose 0.2% in October after a 0.1% rise the previous month, the Labor Department said in Washington. A separate report showed housing starts fell to a 519,000 annual rate, the fewest since a record low reached in April 2009 and down 12% from a revised 588,000 in September that was less than previously estimated.

The Dow shaved 15.62 points (0.14%) to 11,008. The S&P 500 added 0.25 point (0.02%) at 1,178. The Nasdaq gained 6.17 points (0.25%) to 2,476.

Back home, foreign institutional investors were net sellers of stocks worth Rs196 crore on Tuesday while domestic institutional investors were buyers of equities worth Rs449 crore on the same day.

PSU exploration and production major ONGC's (down 1.17%) oil output is expected to go up significantly in the current fiscal on the back of higher reserves accretion after witnessing flat production growth over the past decade, chairman and managing director R S Sharma said today.

He said ONGC's production has been flat at approximately 25 million tonnes of oil per annum in the last ten years, while gas production amounted to 62 million standard cubic metres of gas per day on average, based on the discoveries made by the oil and gas explorer.

IL&FS Investment Managers (down 1.27%), the only listed  private equity firm, today informed the stock exchanges that the company had acquired the shares of Saffron Asset Advisors Private limited (SAAPL), an Indian entity, thus making the latter a subsidiary of the company.

This apart, IL&FS Investment Advisors LLC, a wholly-owned subsidiary of IL&FS Investment Managers has completed the acquisition of Saffron Capital Securities Ltd and Saffron Capital Advisors Ltd with itself. With the acquisition, the assets under management of the company along with its affiliates stands increased to $3.2 billion.

Telecom major Bharti Airtel (up 3.77%) said that its subscriber base has crossed the 200 million mark, with nearly 150 million users in the domestic market alone, and unveiled a new logo to mark the achievement.

The company has 40 million users in Africa, while the rest are in Bangladesh and Sri Lanka.


Mangalore SEZ on track, says ONGC

Bangalore: ONGC has acquired 2,300 acres of land for its Special Economic Zone (SEZ) in Mangalore, its chairman and managing director RS Sharma said today, asserting that the project was "definitely on track". But acquisition of "this much land" is not sufficient to announce the SEZ as a multi-product one, he said, reports PTI.

Mr Sharma sought to downplay opposition from some local quarters to the land acquisition, saying that for a commercial organisation like ONGC, facing such issues is "common".

"This is one of the SEZs in the country that's progressing extremely well," he said, adding that "investments (for the Mangalore SEZ) are very much on track."

"We have not stopped our total funding plan. Everything is very much on track. It's very much on stream," he said, adding that there is "no question mark" on the project.

Mr Sharma said that ONGC is "fully conscious of the concerns on land acquisition" but added that issues would be resolved through discussions leveraging the company's "reputation and standing."


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