The Hindu Business Line : Reliance, State Bank, ITC propel Sensex

CONSOLIDATING on the 65-point gain that the Sensex made during Tuesday's trade, the benchmark index on the BSE put on a further 61.14 points to end the Wednesday trade at 6,194.11 points.

Leading the rally from the forefront were key index stocks such as Reliance Industries, State Bank of India and ITC. On the NSE, the Nifty put on 18.55 points to end at 1,982.15.

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On a day when advances outpaced declines by a ratio of 12 to 10 on the BSE, the market opened firm at 6,162.18 points, almost 30 points higher than its Tuesday's close. The level at which the market opened was also the low for the day. The market then went on to scale an intra-day high of 6,215.02 points half-an-hour before trading closed, before partially shedding some of the gains towards the end of the day's trade.

The action was clearly focused on the heavyweights within the Sensex, led by Reliance Industries, which commands the highest weight among the Sensex constituents. The stock put on Rs 9.85 to settle at Rs 597.4, on the back of trading volumes of close to 30-lakh shares. The stock has gained over 20 per cent since December 1, 2003.

Banking heavyweight State Bank of India was another prominent gainer as the stock put on Rs 28.65 to finish at Rs 674.50. The magnitude of the gain is probably the highest in a single day for the stock in recent times. The surge in the stock price was responsible for a 12.7-point rise in the Sensex. Cigarette major ITC, too, surged by close to Rs 37 to finish at Rs 1,135.15. Trading volumes on the counter stood at close to 1.8-lakh shares.

A divergent trend was witnessed among technology stocks within the Sensex. While Wipro and Satyam Computer ended the day in the black, it did not turn out likewise for bellwether Infosys, which saw its price slip by Rs 95.25 to end at Rs 5,698.55. Other prominent losers within the Sensex were ONGC, Cipla and Hero Honda Motors.

Hero Honda put out its quarterly earnings card after the markets closed for the day and reported a jump in net profit of 33 per cent. The stock shed Rs 13.6 to end at Rs 477.25.

The sharp upmove in State Bank of India appeared to have had a salutary impact on the banking sector as a whole. Bank of Baroda, Andhra Bank, Centurion Bank, Bank of Punjab, Punjab National Bank, Canara Bank, UTI Bank, Bank of India, Jammu and Kashmir Bank, Vijaya Bank and Bank of Rajasthan all ended the day with smart gains.

The exception was Corporation Bank, which declared its third quarter results. Net profit fell by 26 per cent as the bank earned lower income from its treasury operations and also had a higher provisioning for doubtful assets. The street was not all that impressed with the numbers either; the stock shed Rs 14.15 to end at Rs 259.5 on trading volumes of close to 8-lakh shares.

Shipping was another sector that was sailing at a fair clip. Driven by buoyant trends in the dry cargo and the tanker freight market, shipping stocks are on a roll. The firmness in freight prices is expected to provide momentum to the earnings card of companies from this sector. Great Eastern Shipping, Varun Shipping, Essar Shipping and Shipping Corporation of India ended the day on a strong note.

Divi's Labs and Suven Life Sciences were a couple of pharma stocks that were buzzing with activity. While the former put on Rs 87.7 to finish at Rs 1,512.8, the latter gained Rs 94.3 to settle at Rs 601.55.

Videocon International and TV 18 were a couple of other stocks that attracted substantial buying interest.