Profit-booking pulls down markets; auto stocks put up a good show
Indian markets ended up in negative territory, mainly on profit-booking. The Sensex closed at 17,170, declining 28 points from the previous day’s close. The Nifty closed at 5,123; up one point.
Auto stocks were among the major gainers following strong monthly sales figures for November 2009.
Tata Motors jumped 4% after total sales zoomed 65.49% to 54,108 units in November 2009 over November 2008. Tata Motors’ total passenger vehicle sales in the domestic market grew by 44.52% at 20,706 units last month, against 14,327 units in the same month last year, said the company. Exports jumped by 86.64% at 3,994 units, compared with 2,140 units in the same month last year, it added.
India’s second largest bike maker by sales, Bajaj Auto, shot up 3% after the company said total vehicle sales rose 73% to 2.76 lakh units in November 2009 over November 2008. Motorcycle sales jumped 84% to 2.42 lakh units.
Housing Development Finance Corporation (HDFC) announced a dual-rate loan scheme under which a borrower will be charged a fixed rate up to March 2012 and a floating rate thereafter, after market hours on Tuesday. For a 20-year loan of Rs30 lakh, a borrower will pay a fixed rate of 8.25% up to March 2012 and then a floating rate that will be 500 basis points below the prime lending rate (PLR)—the institution’s benchmark rate. Currently, the PLR is 13.75%. The stock was down 2%.
Oil and Natural Gas Corporation (ONGC) was down 1%. As per reports, the company’s unit has signed agreements to pick up stake in a giant gas field and an LNG plant in Iran.
Jaiprakash Associates gained 1% after it posted 48.77% jump in its cement sales to 1.03 million tonnes in November 2008 over November 2008.
ACC fell 1% after cement shipments fell 4.04% to 1.66 million tonnes in November 2009 from 1.73 million tonnes in November 2008 while Shree Cement remained flat after the company’s cement shipments rose 15.28% to 7.09 lakh tonnes in November 2009 over November 2008.
Sterlite Industries declined 1% on reports the government could mop up close to Rs3,000 crore from the sale of its residual stake in Bharat Aluminium Company (BALCO), to Sterlite Industries. Sterlite had bought 51% of BALCO in March 2001 for Rs552 crore from the government.
Indiabulls Real Estate surged 5% after a foreign brokerage raised its rating on the stock to ‘overweight’ from ‘underweight’.
Bharati Shipyard shot up 11% following its decision to increase the open offer price for Great Offshore by 5.4% to Rs590 a share from Rs560 earlier. The open offer for a 20% stake in the offshore drilling company will remain open from 3 December to 22 December 2009. However, Great Offshore tumbled 6% after two block deals were executed in the stock. One bulk deal of 10 lakh shares was struck at Rs575 on the Bombay Stock Exchange. ABG Shipyard said it has sold its stake in Great Offshore, ending a six-month battle with rival Bharati Shipyard for a controlling stake in the offshore services provider. ABG, along with its unit, sold 30.78 lakh shares of Great Offshore, or about 8.27% of equity, through a stock market sale, it said. ABG was up 10%.
Fedders Lloyd Corporation rose 5% after a consortium of the company received an order worth Rs120 crore.
According to the finance ministry, the World Bank has committed to increase its lending to India to about $7 billion this year from an average $2.30 billion in the previous four years. India has also sought early completion of the process of voice and quota reforms at the World Bank to increase the representation of emerging and developing countries, the ministry said.
In September 2009, the World Bank approved $4.30 billion in loans for India to help finance infrastructure building and to shore up the capital of some State-run banks as the economy recovers from the global financial crisis. The loans are part of the bank’s $14 billion lending for Asia’s third-largest economy over three years through 2012.
Meanwhile, the government has reportedly drawn up a list of 25 State firms for stake sales which include Nuclear Power Corporation of India, National Bank for Agriculture and Rural Development, Exim Bank of India, Punjab & Sind Bank, Indian Railways Finance Corporation and National Housing Bank.
As per reports, other companies planning initial public offers (IPOs) include SBI Caps and SBI Fund Management, both subsidiaries of government-controlled State Bank of India.
Many of these IPOs could hit the market after the follow-on public offers of 5% each in NTPC and Rural Electrification Corporation, and a 10% stake sale in unlisted Satluj Jal Vidyut Nigam are completed in the current financial year, the report added.
During the day, Asia’s key benchmark indices in Hong Kong, Japan, South Korea, China, and Taiwan were up by between 0.37%-1.40%.
After Dubai World announced plans to restructure $26 billion of its debt, the Dubai government made it clear that it was not responsible for Dubai World’s debts. This was a blow to creditors’ assumptions that the Arab emirate would guarantee the government-controlled conglomerate’s liabilities.
On Wednesday, 1 December 2009, the Dow Jones Industrial Average surged 127 points while the S&P 500 and the Nasdaq Composite climbed 13 points and 31 points respectively on upbeat economic news and fading fears about the Dubai debt crisis.
As per key US economic news, the Institute for Supply Management said its manufacturing index expanded for a fourth consecutive month in November but at a weaker pace, falling to 53.6 from 55.7 in October.
In premarket trading, the Dow was trading nine points higher.
— Swapnil Suvarna