The Hindu Business Line : Select pharma stocks gain

SELECT pharma stocks were bought on Wednesday when there was heavy selling in the overall market. Some of the pharma stocks bought included Cipla, Dr Reddy's, Ranbaxy, Aurobindo Pharma and Divi's Laboratories.

Dealers said that select market players are buying the shares of these companies ahead of the Global Pharma Fund Managers' meet in Mumbai next week.

The meet is organised by a leading broking firm where top management of various pharma companies are expected to present their future plans. These players feel that various pharma companies are expected to make positive announcements during the meet.

Coke shortage hits steel scrips

THERE was heavy selling in the shares of various steel companies on Wednesday. Interestingly, the selling was not on the back of cut in the import duty on steel but due to the scarcity of coke, a raw material for making steel.

Dealers said that there is huge scarcity of coke in both the domestic and international markets. Due to this, various steel companies may not be able to produce steel.

Coke is mainly used as fuel in manufacturing steel. According to market talk, very few companies have adequate quantity of coke. Even the rise in the price of steel over the last few months has been more due to the hike in the raw material prices rather than the steel demand.

The raw material iron ore prices are currently at 13-14-year highs and in the last one year, there has been sharp rise in the prices. Another important factor affecting the steel industry is the sharp rise in the ship freight rates in the last six months, which is also likely to affect the profitability of most steel companies over the next few quarters, dealers said.

On Wednesday, most steel companies - Tata Steel, SAIL, Jindal Steel, Ispat Industries and Essar Steel - recorded loss in price.

Hedge funds sell in late hours

THERE was some heavy selling by a few hedge funds in the last half hour of trading on Wednesday. Dealers said that the selling was one of the main factors for the sharp fall in the market. A fund is believed to have sold heavily in key index stocks, which prompted various day traders also to sell their holdings.

Virendra Verma

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