Mumbai Up 2.3%, Reliance Infratel IPO

123jump.com Staff
04 Feb, 2008
New York City

Mumbai stocks rallied after a surge in Asian markets and strong close in the U.S. indexes on Friday. Cabinet meeting of ministers is likely to approve two rupees price rise in Petrol and one rupee price rise in diesel fuel. Reliance Communication filed to spin-off its infratel subsidiary. Sensex Index closed up 2.3% or 417 to 18,660. The combined trading turnover on two exchanges rose to 19,500 crore rupees.

[R]1:00PM New York, 11:30PM Mumbai - Sensex surged ahead on the back of the U.S. stocks and Asian markets rally. Reliance Communication filed prospectus for the spin-off its Infratel unit and raise at least 45 crore rupees at face value.[/R]

Market Sentiment

Indian markets closed firm on Monday with the benchmark index at 18,660 levels, marking a gain of 2.3% or 417. In the broader markets, Nifty added 2.8%. The 50-share index closed at 5,463 levels.

The market soared in afternoon and extended morning gains as Asian stocks rose with sentiment boosted by Microsoft Corp''s bid for Yahoo Inc and following China''s buy of a large stake in takeover target Rio Tinto.

IT stocks extended Friday gains and miners and steel share also advanced.

Of the Sensex index shares, 26 gained while the rest fell. As 2,264 BSE shares advanced, 551 that declined, and 36 stocks remained unchanged.

Trading turnover on the BSE was 5,743 crore rupees while on the National Stock Exchange was 13,775 crore rupees.

Future Capital Holdings was the most active stock on the BSE and recorded turnover of 533.35 crore rupees followed by Reliance Communications, Reliance Natural Resources, Reliance Energy and Reliance Industries.

Cabinet meeting of ministers is expected to sanction 2 rupees a liter price increase for petrol fuel and one rupee for diesel fuel this week. The decision on the size of the increase is expected by the end of this week.

The state-run Indian Oil, Bharat Petroleum and Hindustan Petroleum are together projected to lose over 71,000 crore rupees due the government price control on fuel sale prices.

Maruti Suzuki India led the decliners in the Sensex index. The share slipped 1.3% to 893 rupees.

Reliance Energy shed 0.7% to 2,001 rupees, ITC fell 0.2% to 2,040.5 rupees, while HDFC Bank was down 1% to 1,551.1 rupees. Of the BSE shares, Reliance Communications led the advancers in the Sensex index with a surge of 13% to 691.4 rupees.

Reliance Group Update

Reliance Infratel, a subsidiary of Reliance Communications filed its preliminary prospectus for an initial public offer to list 8,91,64,100 shares of 5 rupees each for cash, constituting 10.05% of its post-issue paid-up equity capital.

Reliance Industries added 2.2% to 2,598.2 rupees. ICICI Bank gained 1.1% to 1,211 rupees.

Reliance Power, which raised a record $3 billion in its initial share sale in January 2008, said on Friday, it had begun refunding funds to investors that did not get stock allocation.
The initial public offer had received bids for $190 billion.

Reliance Power is expected to list on the BSE on February 11th, 2008.

Index Changes

DLF soared 9.9% to 894 rupees. DFL will replace GlaxoSmithKline Pharmaceuticals, in S&P CNX Nifty index from 14th March 2008.

IT Stocks Rebound

IT stocks extended Friday gains after Microsoft made a $45 billion bid for Yahoo Inc. Infosys Technologies climbed 3.4% to 1,645 rupees, TCS advanced 4.2% to 968.1 rupees, and Satyam Computers jumped 3.3% to 435.05 rupees.

Wipro soared 6.1% to 464 rupees on the news reports the company plans to build electronic warfare systems, radars and flight simulators locally for the U.S. defense contractors.

Tata Group update

Tata Motors rose 2.1% to 770.05 rupees. It reported 11.76% fall in its passenger car sales in the domestic market during January 2008 at 20,119 units compared with 22,801 units in the same month a year ago.

Steel stocks rose after the talks of price hike. Tata Steel gained 3.9% to 807 rupees while Steel Authority of India rose 2.3% to 231 rupees. Tata Steel has increased the prices of hot rolled coils by 2,000 to 2,500 rupees per ton, while Steel Authority of India Ltd has increased prices by 1,500 to 2,500 rupees per ton.

ONGC Sells a Stake to BP

Oil & Natural Gas Corporation gained 1.8% at 1,064 rupees on reports that British Gas is expected to buy a 30% stake in ONGC''s Krishna Godawari basin block and 25% in Mahanadi basin block.


International Markets

In Tokyo Nikkei 225 Index closed higher 362.54 or 2.69% to 13,859.70, in Hong Kong Hang Seng index increased 908.50 or 3.77% closed to 25,032.08, in Australia ASX 200 index higher 24.50 or 0.42% to close 5,867.40.

In South Korea Kospi Index increased 55.60 or 3.40% to close at 1,690.13, in Thailand SET index closed higher 0.73 or 0.09% to 811.56, and Indonesia JSE Index edged increased 54.81 or 2.07% to 2,701.63. Sensex index in India increased 417.70 or 2.29% to 18,660.32.

In London FTSE 100 Index closed higher 3.00 or 0.05% to 6,026.20, in Paris CAC 40 Index decreased 4.42 or 0.09% to close at 4,973.64 and in Frankfurt DAX index higher 31.82 or 0.46% to close at 7,000.49. In Zurich trading SMI decreased 64.28 or 0.82% to close at 7,751.70.