Yes Bank Earnings Lift Sensex

123jump.com Staff
09 Apr, 2008
New York City

Stock in Mumbai edged higher on better than expected earnings from Yes Bank. The bank also said that it has no exposure to derivatives and risky loans linked to the U.S. loans. The news sent stocks in the banking sector higher. Sensex added 1.3% or 203 to 15,790. On the National Stock Exchange CNX Nifty advanced 0.8% or 37 at 4,747. Tata Power got a loan of $450 million to build a power plant in Mundra, Gujarat with a capacity of 4,000 MW.

[R]10:00AM New York, 7:30PM Mumbai – Stocks rebounded after better than expected earnings from Yes Bank despite weak markets in Europe and Asia.[/R]

Market Sentiment

Indian markets marginally gained in the final session on Wednesday on gains in banking shares after Yes Bank announced a forecast-beating profit and said it had no delinquent derivates exposures.

HDFC Bank and HDFC led the advancers in the Sensex index.

Stocks in Mumbai stepped out of weak trend in Asian and European markets with the 30-share BSE Sensex rising 1.3% to 202.89 at 15,790.51. On the National Stock Exchange CNX Nifty advanced 0.8% or 37.4 at 4,747.05.

Of the BSE traded shares, 1,829 shares gained, 810 shares and 48 shares remained unchanged.

Stocks in banking sector have declined sharply in the last two months of trading on the fears of exposure to risky international loans and post-budget worries related to farm loans. Yes Bank results helped stocks in the sector to recover.

Concerns about corporate and bank earnings grew after recent disclosures from ICICI Bank that it had made a provision of $70 million in third quarter ended December 2007 and may have to provide a further $50 million in the final quarter for mark-to-market losses on investments.

A few days after, L&T announced that one of its subsidiaries L&T International FZE, may incur commodity-hedging-losses of as much as 200 crore rupees in the year ended March 2008.

Realty and technology stocks were battered. Power stocks rose.

Capital goods shares increased on news reports Finance Minister Chidambaram met representatives from auto and capital goods industries to discuss industrial slowdown after recent weakness in industrial productions.

Turnover

Daily turnover of the BSE stood at 5,294 crore rupees and 11,530 crore rupees on the National Stock Exchange.

Orchid Chemicals and Pharmaceuticals was the most active stock with the turnover of 581.72 crore rupees on BSE followed by Reliance Capital, Reliance Industries, Reliance Energy and Larsen & Toubro,

Gainers and Decliners

ICICI Bank gained 2.9% to 836.50 rupees and HDFC Bank rose 5.5% to 1,376.05 rupees. Yes Bank gained 4.7% to 169.75 rupees after it reported 108.74% increase in net income to 64.50 crore rupees in the fourth quarter ended March 2008.

State Bank of India rose 1.1% to 1,693.50 rupees. According to news reports, the bank has identified three potential partners, including Insurance Australia Group, for a general insurance venture. The other two identified partners are German and American companies.

Larsen & Toubro gained 2.2% to 2,637.30 rupees and Bharat Heavy Electricals surged 3.7% to 1,776.75 rupees.

Suzlon Energy rose 4.5% to 302.65 rupees on news reports that government is looking at various measures to provide a enhance performance of the capital goods sector, which experienced a sharp slowdown in growth earlier this year.

NTPC increased 0.6% to 187.70 rupees.

Tata Power Company was up 4.8% to 1,188.80 rupees. The company will get a $450 million loan with 20 years maturity from the International Finance Corp., the World Bank''s private investment arm, for building a plant in the western state of Gujarat.

The company plans to spend 170 billion rupees on a plant in Mundra to generate 4,000 megawatts of electricity.

Tata Consultancy Services fell 1% to 876.65 rupees, Wipro lost 0.6% to 411.70 rupees and Satyam Computer Services declined 0.4% to 427.50 rupees.

However, Infosys rose 1.3% to 1,479.90 rupees.

Housing Development Infrastructure fell 2% to 639.50 rupees, Unitech fell 2.2% to 263.35 rupees and DLF lost 0.9% to 610 rupees.

HDFC gained 4.8% to 2,421 rupees, Tata Steel increased 3.4% to 678.90 rupees, Ambuja Cements was up 1.8% to 120.20 rupees and Hindalco Industries rose 1.4% to 172.65 rupees.

Reliance Update

Reliance Industries rose 1.6% to 2,418.05 rupees. Reliance Communications lost 1.7% to 492 rupees, Reliance Power gained 3.1% to 362.25 rupees and Reliance Energy rose 2.3% to 1,176.90 rupees.