Metals, Telecom, Power Stocks Gain

123jump.com Staff
20 Aug, 2008
New York City

India asked foreign investors to trim their holdings in commodities exchanges below 49% by June 2009 or below 5% for a single investment entity. NYSE Euronext, Citigroup and Merrill Lynch each own 5% stake in the MCX and Goldman Sachs own 7% in NCDEX. Cell phone and other telecom operators rose after the telephone regulator permitted Internet based discount telephone services. Bharti Airtel and Reliance Communication rose on the hopes that revenue impact will be marginal.

[R]10:00AM New York, 7:30PM Mumbai – Foreign investors will have to trim stakes in commodities exchanges. Power and realty sector stocks gained.[/R]

Market Sentiment

In Mumbai, the BSE 30-share Sensex increased 0.92% or 134.50 to 14,678.23, and the CNX Nifty gained 1.09% or 47.50 to 4,415.75.

Of the stocks traded on the BSE, 1,666 rose, 969 declined, and 83 were unchanged.

Trading Statistics

Daily turnover on BSE was 4,233 crore rupees compared with 3,972.48 crore rupees yesterday.

Jaiprakash Associates rose 1.27% to 171.40 rupees, HDFC gained 1.24% to 2,311.55 rupees, and Maruti Suzuki India edged up 1.17% to 623.40 rupees.

Foreign Co.’s to Cut Stake in Indian Commodities Exchanges

The Indian commerce ministry said in a statement released today that foreign companies that hold more than the stipulated 5% in commodity stocks will have to cut their holdings by June 30, 2009, while cumulative overseas holdings in a single exchange must be cut to 49% in the same period.

Commodity exchanges have mainly been the prime target of foreign investors seeking to capitalize from the burgeoning business activity.

In March this year India allowed foreign firms to jointly invest up to 49%, of which 26% was through foreign direct investment and 23% in portfolio investment. An individual can however hold a 5% stake in the exchange.

Gainers & Losers

Realty stocks lead the gainers in trading. Unitech increased 2.52% to 169.15 rupees, Indiabulls Real Estate gained 1.53% to 315.85 rupees, and Housing Development & Infrastructure edged 0.67% to 405.25 rupees, and DLF rose 1.9% to 509.90 rupees.

Power sector stocks were second largest gainers. Reliance Infrastructure advanced 1.55% to 1,009.70 rupees, Reliance Power jumped 2.23% to 160.60 rupees, NTPC rallied 1.41% to 183.95 rupees, PowerGrid Corporation of India climbed 1.25% to 93.35 rupees and Tata Power Company rose 0.59% to 1,024.35 rupees.

Grasim Industries gained 3.64% to 2,028.35 rupees, while Bharat Heavy Electricals edged up 3.4% to 1,734.90 rupees.

Larsen & Toubro rose 1.5% to 2,714.65 rupees on news that the company is on the verge of buying equity stake in coal mines in Australia and Indonesia.

Bharti Airtel increased 2.99% to 815.25 rupees and Reliance Industries rallied 1.03% to 2,244.15 rupees.

HDFC Bank also jumped 2.52% to 1,237.90 rupees, and Ranbaxy Laboratories soared2.71% to 505.65 rupees.

Infosys rose 0.3% to 1,698.70 after chief executive S. Gopalakrishnan said that clients are not seeking price discounts.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 13.36 or 0.10% to 12,851.69, Hang Seng index in Hong Kong increased 446.89 or 2.18% closed to 20,931.26. ASX 200 index in Australia increased 63.10 or 1.30% to close 4,929.50. The KL Composite index in Malaysia increased 3.79 or 0.35% closed to 1,073.21.

The Kospi Index in South Korea decreased 0.70 or 0.05% to close at 1,540.71, SET index in Thailand closed lower 1.28 or 0.19% to 690.05 and JSE Index in Indonesia increased 27.20 or 1.33% to 2,069.70. The Sensex index in India increased 134.50 or 0.92% closed to 14,678.23.