Thursday Closing Report: Rally may stretch up to 20,400

The local market opened on a strong note this morning on positive cues from across the globe. Easing of weekly inflation numbers and good earnings figures gave the indices the much-needed boost, enabling them to erase the losses suffered over the past two days.

The market started the day in the green on optimism seen in the US markets overnight; it also brushed aside the cautiousness exhibited by Asian bourses this morning. Early buying gave way to range-bound trade in the morning session. However, easing of the country's weekly food inflation numbers lifted the indices further, helping them touch the day's highs and surpass the crucial levels of 20,200 on the Sensex and 6,100 on the Nifty.

The Sensex ended the day's proceedings at 20,260, up 388.43 points (1.95%). The index touched a high of 20,293 and a low of 19,886 during the session. The Nifty settled at 6,101, up 119.40 points (2%). The benchmark touched a high of 6,113 and a low of 5,985, intraday.

The market breadth was in favour of the gainers. Twenty nine of the thirty Sensex stocks ended in the green today. The Nifty closed with 45 gainers against 5 declining stocks. Among the broader indices, the BSE Mid-cap index surged 1.37% while the BSE Small-cap index rose 1.04%.

The top performers on the Sensex were Hindalco Industries (up 5.05%), Bharti Airtel (up 5.03%), Hindustan Unilever (HUL) (up 3.95%), ITC (up 3.65%) and Cipla (up 3.59%). NTPC, down 0.12%, was the lone loser today.

All sectoral indices ended in the positive zone today. BSE Fast Moving Consumer Goods (FMCG) (up 3.19%), BSE Bankex (up 2.09%) and BSE Oil & Gas (up 2.03%) were on the top of the list while BSE IT, with a gain of 0.89% ended at the bottom of the list.

Food inflation declined to 15.53% for the week ended 9th October, down by 0.84 percentage points from 16.37% in the previous week, government data showed.

Experts said the impact of adequate monsoon was slowly becoming visible on prices of essential items, as supply-side pressure was easing after the good harvest.

 Markets in Asia ended mostly in the green on positive signals emanating from the US markets in overnight trade. However, cautiousness prevailed as China announced sluggish growth numbers for the third quarter even as inflation in September rose to the fastest pace in yearly two years.

The Hang Seng was up 0.39%, Jakarta Composite was up 0.25%, KLSE Composite was up 0.29%, Seoul Composite gained 0.23% and Taiwan Weighted added 0.08%. On the other hand, the Shanghai Composite was down 0.68%, Nikkei 225 shed 0.05% and Straits Times lost 0.49% in today's trade.

Markets in the US erased most of the losses accrued on Tuesday on good earnings reports and a weak dollar, which increased investors' appetite for riskier assets like stocks and commodities. Material and energy stocks, which took a beating on Tuesday, were the top performers yesterday. Financial companies reported mixed earnings. While Wells Fargo & Co announced higher earnings but Morgan Stanley came up with a surprise loss.

The Dow advanced 129.35 points (1.18%) to 11,108. The S&P 500 gained 12.27 points (1.05%) to 1,178. The Nasdaq rose 20.44 points (0.84) to 2,457.

Participation by institutional investors was lacklustre on Wednesday, giving an indication that funds have gone to the Coal India initial public offering. While foreign institutional investors were net buyers of stocks worth Rs16.35 crore, domestic institutional investors were net sellers of Rs27.50 crore.

Gayatri Projects (up 1.09%) has bagged an order worth Rs43.45 crore from FLSmidth for completion of work at the Kumaraswamy Iron ore Crushing project at Donimalal, Bellary in Karnataka.

Gayatri Projects is one of the fastest growing construction company in India executing major civil works including construction of concrete/masonry dams, earthen dams, national highways, bridges, canals, aqueducts, airports, ports, etc.
With a view to push its bulk drugs and immuno-suppressant products overseas, RPG Life Sciences (down 2.57%) is eyeing marketing and distribution tie-ups with foreign companies, a top company official said.

The tie-up will help the RPG Group company push its products in Europe. Both the companies will buy products from each other and sell them in their respective strong markets.

State-owned exploration and production (E&P) major Oil and Natural Gas Corporation (ONGC) (up 0.56%) today wrote to Cairn Energy Plc insisting that the UK-based firm will need its explicit nod before it can sell its India unit to Vedanta Resources Plc.

ONGC, which partners Cairn India in all of its three producing assets and most of the seven exploration acreage, wrote to Cairn Energy Plc saying that it has the right of first refusal (RoFR) on these assets.

Cairn Energy, which holds 62.38% stake in Cairn India, is selling 40%-51% stake in the India unit to London-listed Vedanta Resources for $8.48 billion.


OM Metals Infraprojects JV wins contract worth Rs144 crore from Madhya Pradesh government

Hydro-mechanical equipment supplier, OM Metals Infraprojects Ltd in joint venture (JV) with SEW Ltd has won a contract worth Rs144  crore from Madhya Pradesh Water Resource Department.

The scope of work includes over flow and non-over flow construction of concrete dam including HM components in Pench diversion project in Chindwara district.
On Thursday, OM Metals Infraprojects shares ended 15.1% up at Rs67 on the Bombay Stock Exchange, while the benchmark Sensex closed 2% higher at 20,260 points.


Mahindra Lifespace net profit rises to Rs24.7 crore in Q2

Commercial and residential property developer, Mahindra Lifespace Developers Ltd (MLDL), said its net profit for the second quarter ended 30 September 2010 increased to Rs24.7 crore, a rise of 42%, from Rs17.3 crore.

Net sales stood at Rs89 crore, an increase of 40%, against Rs63.5 crore for the same quarter last year, said the company in a regulatory filing.

During the quarter, the company launched the final phase of its residential project Eminente in Goregaon, Mumbai, the second phase of its residential project, Aura in Gurgaon. The first phase of Aqualily apartments at Mahindra World City in Chennai was also launched during the year by Mahindra Residential Developers Ltd, a subsidiary of the company.

On Thursday, Mahindra Lifespace shares ended 1% up at Rs478 on the Bombay Stock Exchange, while the benchmark Sensex closed 2% higher at 20,260 points.


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