Indian Markets Gain, Fourth in a Row

123jump.com Staff
25 Oct, 2007
New York City

Sensex in Mumbai trading increased 1.39% to close at another record high of 18,770.89. In broad based buying stocks in infrastructure, real estate, and banking sector led the gainers. After the close SEBI, regulatory arm of the Finance Ministry of India released rules for P-notes. Cipla profit increased 5.7% but at Reddys profit declined 5%.

[R]10:00AM New York, 7:30PM Mumbai - Sensex advanced for the fourth day in a row.[/R]

The Sensex gained 257.98 points or 1.39% at 18,770.89 and the S&P CNX Nifty advanced 72.80 points or 1.32% at 5,568.95. In volatile trading Sensex closed higher ahead of the SEBI meeting to decide the fate of the P-notes.

Of the Sensex stocks, 21 advanced and nine stocks were unchanged. Of the stocks traded on the BSE 1,552 share rose, 1,147 fell, and 71 remained unchanged. The total turnover on BSE was to 7,976 crore rupees and on the NSE was 23,477 crore rupees.

SEBI in a press statement released after the market close said that foreign investors will have to unwind so called Participatory Notes in eighteen months. Sub accounts of foreign institutions will not be allowed to issue P-notes. Non-profit international institutions including endowment funds, university funds, charitable trusts, and pension funds will have to register with Sebi to invest in Indian stock market.

The registered foreign investors may issue only 5% of incremental assets as p-notes till they meet 40% limit.

The revised rules are close to the earlier draft proposal discussed in the media by the SEBI Chairman, M. Damodaran. Through the tighter restrictions on assets managed by the foreign institutions SEBI hopes to limit market volatility and direct investment through registered accounts only.

Since the beginning of the year 2007, net foreign portfolio investments have exceeded $16.5 billion ahead of annual inflow in 2006 of $10.7 billion.

Indian stock market has received more than $8 billion of foreign investments in less than four weeks after the United States cut interest rates in mid-September. However, foreign institutions have sold nearly $1.3 billion since the announcement of the plans.

Cipla reported a 5.73% increase in profit to 1,906.2 million rupees from 1,802.8 million rupees during the quarter ended September 2006. Net sales surged 22.57% to 10,983.90 million rupees compared with 8,961.10 million rupees in the same period last year.

Total income rose 24.59% to 11,402.10 million rupees from 9,151 million rupees for the same period last year. The diluted EPS, after extraordinary items, stood at 2.45 rupees. Cipla slumped 5.10% to 186.6 rupees leading the decliners among Sensex stocks.

Tata Steel retraced 7.9% higher to 988 rupees on news that it is looking for investment opportunities in Brazil, leading the gainers in the Sensex stocks.

Hindalco Industries gained 1.5% to 191.85 rupees, Sterlite Industries surged 2.8%, Sesa Goa jumped 1.7% to 3319.8 rupees and Steel Authority of India ended stronger at 2.8% to 250.2 rupees.

Maruti Suzuki surged 1.9% to 114 rupees, Bajaj Auto rose 0.8% to 2,499 rupees, Mahindra & Mahindra added 1.6% to 772 rupees and Tata Motors was up 1.08% to 783 rupees.

ICICI Bank gained 3.4% to 1,135 rupees and State Bank of India advanced 0.91% to 1925.30 rupees.

Larsen & Toubro gained 1.39% to 3,450 rupees, Reliance Industries surged 0.58% higher at 2,624.70 on news that its joint venture firm ONGC-Mittal Energy had acquired a 30% participating interest in an exploration block in the Caspian Sea, Turkmenistan. Oil and Natural Gas Corporation rose 0.55% to 1,114 rupees.

Dr. Reddy''s Laboratories slipped 1.80% to 618.6 rupees. The company reported a 5% dip in net profit at 267.2 crore rupees for the quarter ended September 2007 as compared with 279.8 crore rupees in the same period last year.

The company revenues registered a 37% decline at 1.267 crore rupees with 2,003.9 rupees achieved during the comparative period.

ACC shed1.3% to 1,063.1 rupees, ITC slid 0.7% to 183.5 rupees Infosys Technologies retreated 0.4% to 1,836 rupees and Reliance Energy declined 0.05% to 1,653 rupees.