India Stocks Reverse Gains; HDFC, BHEL Net Up

Mayank Mehta
22 Jul, 2009
New York City

Indian Government tax collection in June increased 3.7% and India is not likely to meet its export target of $200 billion in the current fiscal year. Monsoon rains are still trailing the historical average sparking fears of drought. HDFC quarterly net gains 21%.

[R]5:00 PM Mumbai, 7:30 AM New York – Indian Government tax collection in June increased 3.7% and India is not likely to meet its export target of $200 billion in the current fiscal year. Monsoon rains are still trailing the historical average sparking fears of drought. HDFC quarterly net gains 21%.[/R]

The market indexes edged 2% higher in the morning trading but lost its momentum in the afternoon.

Sensex index declined 252.36 to 14,810.13 and the CNX Nifty decreased 66.75 or 1.49% to 4,402.35. Of the stocks in the index, 26 decreased and 4 increased.

Trading on the BSE increased to 6,643 crore rupees from 6,215.28 crore rupees.

India Meteorological Department forecast of rain increase in July after weak June month has so far not been on the mark. The development of another storm in the Pacific Ocean is likely to adversely affect rain in the next week.

The government is exploring sell of small stakes to raise as much as 25,000 crore rupees. The stakes in NMDC and Manganese Ore India are considered for sale.

India is not likely to meet its export target of $200 billion in the current fiscal year according to Junior Trade Minister Jyotiraditya Scindia.

The tax collection in fiscal first quarter increased 3.7% to 59,465 crore rupees according to Central Board of Direct Taxes spokesperson. Corporate tax receipts, which is 60% of all taxes collected in the month increased 3.3% and person income tax increased 4.4% to 24,564 crore rupees.

Gainers & Losers

ONGC increased 4.1% to 1,089 rupees a day before its earnings report. The company is in early stage of negotiation with an oil field in Ghana controlled by Kosmos Energy. The deal may be valued between $3 billion and $5 billion.

Reliance Industries decreased 2% to 1,977.30 rupees despite a rise in oil futures prices in international markets.

Wipro Limited declined 1.5% to 451 rupees after it reported net profit increase of 0.5% to 1,015 crore rupees on 2.5% decline in sales to 6,289 crore rupees. The company expects a modest growth in its IT services in the second quarter, between 0.9% and 1.9% on a constant currency basis.

Bharat Heavy Electricals decreased 2.9% to 2,150 rupees after it reported net profit increase of 22.4% to 470.59 crore rupees on revenues gain of 27.6% to 5,898.51 crore rupees. The company also reported outstanding orders of 1,240 arab rupees.

Hindustan Zinc decreased 2.4% to 652.05 rupees after it reported 15% decline in profit to 719 crore rupees and NMDC increased 1.6% after the media reports suggested that the government is exploring stake sale in the mining and mineral processing company.

HDFC decreased 4.4% to 2,410.30 rupees after it reported net profit increase of 21% to 564.92 crore rupees on 22.9% increase in net revenues of 2,849 crore rupees.

Canara Bank decreased 2.1% to 263.35 rupees after the gross non-performing loans surged 87.3% to 2,462.94 crore rupees in the fiscal first quarter compared to a year ago.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed higher 71.14 or 0.74% to 9,723.16, Hang Seng index in Hong Kong decreased 253.56 or 1.30% to 19,248.17 and CSI 300 index in China closed higher 67.09 or 1.90% to 3,606.92. ASX 200 index in Australia increased 17.80 or 0.44% to 4,068.50. The FTSE Bursa KL Composite index in Malaysia closed higher 14.00 or 1.23% to 1,148.70.

The Kospi Index in South Korea increased 5.05 or 0.34% to close at 1,494.04. SET index in Thailand closed lower 11.61 or 1.90% to 598.22 and JSE Index in Indonesia decreased 20.94 or 0.98% to 2,125.62. The Sensex index in India decreased 219.37 or 1.46% to 14,843.12.