Power Stocks Active in India

123jump.com Staff
24 Nov, 2008
New York City

Stocks in India edged lower in weak trading sentiment. Banks led the decliners but software services exporters gained earlier before closing lower on the hopes that lower operating costs will support earnings gains. Realty stocks fell after finance ministry report suggested lower economic growth.

[R]10:00AM New York, 7:30PM Mumbai – Stocks in India edged lower in weak trading sentiment. Banks led the decliners but software services exporters gained on the hopes that lower operating costs will support earnings gains.[/R]

Market Sentiment

Indian stocks fell in volatile trading as the key index swung between gains and losses on reports that the U.S. government will bail out troubled lender Citigroup and the domestic economic growth is likely to weaken.

In Mumbai, the BSE 30-share Sensex declined 0.1% or 12.09 to 8,903.12, and the CNX Nifty gained 0.6% or 14.80 to 2708.25.

Reliance Power rose 6.1%, Gail India soared 5.1%, National Aluminium Company edged up 4% and Idea Cellular Services increased 4.6%.

Trading Statistics

Of the stocks traded on the BSE 1,065 rose, 1387 declined, and 76 remained unchanged.

U.S. Guarantees Citigroup''s $300 billion Assets

The U.S. government- the Federal Reserve Bank, U.S. Treasury and the Federal Deposit Insurance Corporation- announced yesterday that it will guarantee Citigroup''s troubled assets including loans and securities that are backed by residential and commercial real estate worth $306 billion.

Government will also invest $20 billion in the lender from the Troubled Asset Relief Program in exchange for preferred shares and an 8% dividend.

Under the agreement, Citigroup''s executive will implement “enhanced executive compensation restrictions” and the Federal Deposit Insurance Corp. mortgage modification program.

Indian Economic Growth to Weaken

The Economic Times of India reported today that the finance ministry said in a report prepared for a conference of financial editors India''s economy is forecasted to ease this fiscal year on a slowdown in the economy and deteriorating financial conditions.

The report notes that the prospect for India’s economy growth still remains “fairly robust”.

“Circumstances continue to be largely favorable for sustained, rapid and more inclusive growth of the economy,” the report said.

Gainers & Losers

Ranbaxy fell 4% to 211 rupees, Grasim dropped 3.9% to 898.70 rupees, and Jaiprakash Associates declined 2% to 57.10 rupees.

ACC rose 1.4% to 405 rupees and Bharti Airtel soared 2.6% to 635 rupees.

Financial stocks also fell on speculation that the bailout of Citigroup by the U.S. government is unlikely to calm the financial markets. ICICI Bank shed 4.8% to 319.60 rupees, State Bank of India fell 3.9% to 1,137.25 rupees, and HDFC Bank lost 4% to 822.20 rupees.

Realty stocks shed. DLF dropped 4.6% to 189.05 rupees, Unitech declined 10.1% to 28.65 rupees, and Housing Development & Infrastructure fell 3% to 81.60 rupees.

IT stocks fell. Satyam Computer Services plunged 4.4% to 230 rupees, Infosys Technologies declined 0.4% to 1,190 rupees and Wipro increased 1.8% to 234 rupees.

Housing Development Finance Corporation, in which Citigroup holds 12%, slid 1.7% to 1,375.10 rupees.

Commodity stocks fell on fears that the deepening global recession will affect demand. Hindalco Industries fell 0.9% to 51.45 rupees and Tata Steel fell 3.8% to 154 rupees.

Oil & Natural Gas Corporation fell 2% to 676 rupees on profit taking after rising as much as 6.1%.

Tata Motors declined 0.8% to 132.50 rupees on reports the company''s Jamshedpur plant for commercial vehicles will lower production for five days between November 25 and 29.

Tata Power gained 4.5% to 659 rupees, Reliance Infrastructure edged up 2.9% to 499.25 rupees, NPTC advanced 2% to 153.25 rupees and Reliance power soared 6.3% to 111.05 rupees.

Bharat Heavy Electricals gained 1.2% to 1,296.50 rupees after it received an order valued at 240 crore rupees from Coastal Gujarat Power for manufacturing and supplying transformers to Tata Power''s power project in Gujarat.