India Up 0.8%, Reliance Comm Rallies

Ivaylo
05 Feb, 2007
New York City

The market surged for a third session in a row on strong showing in the auto, consumer durables and telecom sectors. Metal stock bucked the trend and declined. Reliance Communications, HDFC, Maruti and Hero Honda led the gainers. Hindalco and Wipro led the decliners. The Finance Minister said that India

[R]8:30AM NY-7:30PM Mumbai - Sensex rallies on the back of strength in telecom and auto stocks.[/R]
The Sensex on BSE ended the session on Monday 112.13 points, or 0.78%, higher at 14,515.90. The market-breadth was strong as mid-cap and small-cap companies also took part in the rally. For every three advancers, there were two decliners. As 1,529 shares advanced on BSE, 1,135 declined and 60 shares were unchanged. Of the 30 stocks in the Sensex, 21 advanced, while the rest declined. The turnover on BSE was Rs 4,691 crore, lower than Rs 5,433 crore on Friday. On NSE, the turnover amounted to Rs 9,185.62 crore, lower than Rs 10,257.56 crore on Friday.

Economic news

Indian Finance Minister P Chidambaram said earlier on Monday that India’s increased credit rating will be beneficial to foreign fund inflows. Investors hope that the finance ministry will pay special attention to agriculture and infrastructure in the budget.

Trading highlights

Shree Ashtavinayak was the most-active stock with a turnover of Rs 314.80 crore followed by Auto Industries and Reliance Communications.

New issue, First Source is oversubscribed 47 times according to baking sources.

Advancers

Reliance Communications led the advancers, surging 5% to Rs 515.75. Mobile services companies rallied today on the decision of the Telecom Regulatory Authority of India to reduce termination charges. Bharti Airtel also advanced 1% to Rs 779.40. Auto stocks rallied on investor expectations that in the upcoming budget excise and sales tax may be lowered on small cars. Largest auto maker Maruti Udyog gained 2% to Rs 965, while Tata Motors added 1% to Rs 920. Bajaj Auto advanced 1.7% to Rs 2,827 and Hero Honda edged 1.2% higher to Rs 724.90.

Strong demand for housing loans helped HDFC to gain 4%, to Rs 1,818 while Reliance energy surged 2.8% to Rs 549 on reports that it will bid for Globeleq, a British power investment company. Tata Steel advanced 1.7% to Rs 471. Index heavy Reliance Industries gained 1.3% to Rs 1,390 and The State Bank of India edged 1.2% to Rs 1,196 on the news that the company plans to raise $700 million by the end of this quarter. Indiabulls Financial Services surged 2.3% to Rs 452.25, as the company reported it was considering restructuring and separating its financial brokerage and consumer finance business to a separately listed company.

Decliners

The decline in base metal stocks on the London Metal Exchange brought metal shares down. Hindustan Zinc shed 5.7% to Rs 653.50, Sterlite Industries lost 6.6% to Rs 485.50 and Hindalco plunged nearly 3% to Rs 177.80. Wipro declined 1.3% to Rs 635.