Sensex Up 2%

Elena
13 Sep, 2006
New York City

The market jumped for a second straight day, but erased some of the early gains as Sensex reached key resistance level near 12,000. Banks gained as declining oil price offered hopes that the Reserve Bank may keep short term rates steady. Bharti Airtel, NTPC, ICICI Bank, SBI, Maruti led the advancers on BSE. Reliance Communications, Hindalco and Tata Steel led the decliners.

[R]10:30AM India rallies for a second day in a row on fall in crude oil.[/R]
The Sensex on BSE ended 233 points, or 2% higher, to settle at 11,893.79. The market breadth was strong as1,698 shares advanced, 822 declined and 68 shares were unchanged. Advancers outpaced decliners by a ratio of two to one. From the Sensex stocks 28 advanced and 2 declined. The turnover on BSE was Rs 3,967 crore, compared to Tuesday’s Rs 3,341.43 crore. The turnover on NSE was 7,473 crore.

Brazilian and Indian state controlled oil companies signed a two-year cooperation agreement to explore deep water oil and gas drilling and bid jointly for oil exploration blocks in India and Brazil. ONGC of India and Petrobras of Brazil amy extend the agreement two more years if certain conditions are met.

Cellular services provider Bharti Airtel soared 5% to Rs 444.80 on 4.8 lakh shares on BSE. Power generation firms were in focus. NTPC jumped nearly 5% to Rs 130 and Tata Power rose 4.7% to Rs 526. Banks advanced as declining oil price triggered hopes that the central bank may keep rates unchanged at its credit policy review meeting in October 2006. ICICI Bank gained 4.3% to Rs 630.95, HDFC Bank rose 3.4% to Rs 870 and State Bank of India advanced nearly 4% to Rs 969.

IDBI jumped nearly 14% to Rs 70.90 and United Western Bank added 5%, to Rs 22.50, after the Reserve Bank of India offered ailing UWB to IDBI. Leading airline Jet Airways Ltd. gained 7.7% to Rs 685.35, and state-run refiner Indian Oil Corp. was up 3.9% at Rs 534.95.

Auto shares continued to trade in positive territory on hopes that the government will not raise domestic fuel prices in the near term due to falling global crude oil price. Car large-cap Maruti Udyog jumped 3.6% to Rs 956, TVS Motor advanced 3.3% to Rs 115.50, Bajaj Auto rose 2.5%, to Rs 2,779, Ashok Leyland gained 2.5% to Rs 42.40 and Tata Motors jumped 2.3%, to Rs 874.

Software shares were in demand after a higher overnight closing of the Nasdaq Composite in the US. Infosys advanced 2% to Rs 1,808, TCS rose 2% to Rs 1,000, Satyam Computer gained 2.7% to Rs 804.95 and Wipro edged up 1.3% to Rs 510.

Marico Ltd advanced 0.9% to Rs 517.50 on announcing its entry into the Rs 170 crore hair-care market in Egypt through the brand Fiancee, hitherto owned by the Egypt-based Ready Group. Hindustan Oil Exploration Company surged 3% to Rs 120.15 after Indian authorities handed over to it operations of an existing oil block.


[R]09:45AM Stocks opened lower on rising oil, Merck, Lehman Bros.[/R]
U.S. stocks opened in the negative, reversing from a strong rally Tuesday when the Dow Jones industrials rose more than 100 points. Negative news from Merck & Co., a decline by the shares of Lehman Brothers Holdings Inc, as well as an upward move by the price of oil generated some negative sentiment. Recently stocks have turned mixed.

After ending the previous session at a five-month closing low, crude futures rose to $64.25 a barrel sending energy stocks higher. Shares of Merck ((MRK)) fell more than 2% after two new studies indicated that withdrawn pain reliever Vioxx carries an increased risk of kidney and heart arrhythmia problems. Lehman Brothers slipped after reporting a better-than-expected Q3 profit despite a slowdown in its investment-banking business. Lehman Brothers ((LEH)) reported Q3 profit increase to $916 million, or $1.57 a share from $864 million, or $1.47 a share last year, supported by higher trading revenue. The company''s revenue in the quarter totaled $4.18 billion, compared to $3.85 billion. Company’s quarterly results exceeded expectations of 1.50 a share, on revenue of $4.01 billion. In the first hour of trading, the Dow Jones industrial average fell 2.24, or 0.02%. The Standard & Poor''s 500 index rose 0.68, or 0.05%, and the Nasdaq composite index gained 4.83, or 0.22%.


[R]8:15AM Stock futures were mixed ahead of Lehman Bros earnings.[/R]
Stock market futures traded mixed Wednesday, with investors awaiting third-quarter earnings release by investment-banking giant Lehman Brothers. Lehman Brothers ((LEH)) is due to report Q3 earnings, following Goldman Sachs results announced Tuesday. Analysts expect Lehman to report net income of $1.49 a share.

Automaker Ford ((F)) will be another company in focus after reports it is planning to cut its white-collar costs by nearly a third. Hewlett-Packard ((HPQ)) is also expected to draw some attention as a California''s Attorney General said he had enough evidence for indictments inside and outside the company. Lehman Brothers upgraded the Gap Inc. ((GPS)) to overweight from equal-weight. The broker told clients that unless same-store sales improve, a management change could happen before the end of the contract of the present CEO. BP ((BP)) gained 0.7% in London on news that the company is close to a deal with the Department of Interior that would help resolve the agency''s worries about flawed Gulf of Mexico drilling leases. Dow Jones futures were recently down 10 points, S&P futures slipped 1.5 points, while Nasdaq futures climbed 2 points.


[R]7:30AM Asian markets close higher on chip-makers and property stocks.[/R]
Asian markets finished higher on Wednesday. The Nikkei 225 Average finished the day 0.2% higher at 15750.05. Stocks in Tokyo closed mixed as a strong showing amid the export-oriented technology sector failed to counter declines in commodity companies. Elpida Memory advanced 6.6%, and Sumco gained 5.2%. On the other hand, selling pressure on consumer finance stocks continued, as Takefuji lost 3.4% and Aiful sank 3.3%.

Hong Kong Hang Seng Index gained 0.79% to close at 17210.04. shares ended higher for the second straight session. HSBC closed 0.7% higher, and China Mobile rose 1.2%. South Korea Kospi Index advanced 0.38% to 1333.13. Hynix Semiconductor advanced 3.1% on the company positive fundamentals and stabilizing memory chip prices. Transport shares rose on a sustained fall in oil prices, as Hyundai Merchant Marine rose 0.9% and Asiana Airlines climbed 1.6%.

Taiwan gained 0.59% to 6664.87. Stocks tracked Wall Street, with food companies leading after Uni-President Enterprises was chosen as a sponsor of the 2008 Beijing Olympics. Australia S&P/ASX 200 closed 0.86% higher at 5017.20. The stock market reversed two days of heavy losses with share-price gains tempered by the outlook for the Chinese-driven commodity boom. BHP Billiton gained 1.6% and Rio Tinto advanced 1.4%. Shanghai Composite Index bucked the upward trend and lost0.4% to finish at 1689.39.


[R]6:30AM European stocks traded higher Wednesday, tracking U.S. markets[/R]
European markets were higher by mid-morning on Wednesday. The U.K. FTSE 100 index rose 0.1% to 5,902, the German DAX Xetra 30 index advanced 0.2% to 5,888 and the French CAC-40 index increased 0.2% to 5,134. BAE Systems gained 1% after it said that its first-half net income rose 28%. On the other hand, Safran, the aero engine and telecoms group, plunged 7.6% after first half proforma operating profits fell 35%.

Scania, the Swedish truck company, jumped 8.9% in the wake of confirming MAN AG, its German rival was likely to make a bid. The stock rose 9% on Tuesday. MAN added 2.8%. Investor rose 4.4% following the investment vehicle statement it was willing to sell its Scania stake. Mediaset, private broadcaster, fell 3.5% after it announced its Italian advertising sales target of 2-3% did not seem achievable.

Crude oil for October delivery fell 26 cents to $63.50 in electronic trading on the NYME in London. Gold for immediate delivery dropped $5.88, or 1%, to $581.57 an ounce in London. The euro was down slightly against the U.S. dollar Wednesday. In morning European trading the euro bought $1.2695, down from $1.2702 in New York on Tuesday. The British pound climbed slightly to $1.8748 from $1.8743 the day before, while the dollar rose to purchase 117.75 Japanese yen from 117.68 in New York.