The Hindu Business Line : Steel, banking, auto stocks in limelight

THE stock markets, which had declined marginally on Wednesday, surged on Thursday, aided by interest in select stocks of the steel, banking, auto and energy sectors. The Sensex ended at 5414.44, up 19 points from Wednesday's closing of 5395.28 points. The Nifty gained 12 points to close at 1704.45, up from 1692.10 points.

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The Sensex opened on a strong note at 5403.38 points, higher by 8.1 points than its previous close. It remained in the positive territory for the greater part of the day. There was selling pressure in the later part of the trading sessions that drove the market into the negative territory, but the weakness was temporary. But, heavy buying in the last hours of trading pushed the benchmark index into positive territory again, up by 0.36 per cent. Among the stocks constituting the Sensex, Tata Steel, Tata Power, Bharti Tele, Tata Motors and SBI were the major gainers. Prominent losers included Cipla, Hindalco, ICICI Bank, Ranbaxy and Bajaj Auto.

Positive sentiment prevailed in the markets on Thursday as indicated by the advance-decline ratio. For every stock that declined, two stocks gained.

Bharti Tele-Ventures rose sharply on the back of its board's approval to raise $100 million by way of foreign currency convertible bonds to fund expansion. The stock put on Rs 6.35 to close at Rs 145.45.

Tata Power gained Rs 13.35 to close at Rs 359.55. The surge may be on the back of news reports of a possible agreement with GAIL (India) and BP to jointly bid for Dabhol Power, wherein it would run the plant and distribute the electricity. Other power sector stocks such as Neyveli Lignite and Ahmedabad Electric gained while Reliance Energy declined marginally.

Steel stocks, which have been in the limelight over the last couple of months on the back of surging prices, continue to experience heavy activity. Leading the pack was Tata Steel, which appreciated by Rs 15.5 to close at Rs 371.75. SAIL and Essar Steel were also among the gainers.

Auto stocks were also in favour. Tata Motors gained for the second day on the back of positive ratings from Moody's. It rose by Rs 13.75 to end the day at Rs 453.10. Maruti Udyog gained smartly to close higher by Rs 31.2 at Rs 482.8. Mahindra & Mahindra, TVS Motor, Eicher Motors and Ashok Leyland were also among the gainers for the day.

There was a sharp rally among banking stocks particularly that of public sector banks. Notable gainers were Bank of Baroda, Indian Overseas Bank, Vijaya Bank, Punjab National Bank, Dena Bank and SBI. Indian Overseas Bank touched a new high at Rs 54.25.

Hindustan Lever declined marginally on the back of news of smaller companies entering the fray with announcements of price cuts. Henkel Spic also declined by Rs 1.20 to close at Rs 12. The company, while not reducing its prices as of now, is however offering freebies to its customers as a promotion tactic.

Polaris Software declined on Thursday by Rs 9.15 eroding most of the gains it had made on Wednesday. IT bellwether Infosys recorded modest gains. The company believes that the appreciating rupee would not affect its earnings.

Cipla, which had gained on Wednesday on the back of its stock split, declined by Rs 46.4 to close at Rs 1,127 on profit-booking.

Texmaco appreciated by Rs 2.7 to close at Rs 77.80. The interest in the stock could be on the back of its bagging an order worth nearly $17 million from Container Corporation of India.

Elder Pharma gained Rs 1.45 to close at Rs 109.35. This could be viewed in the backdrop of its entering into an association with Laboratories Biorga of France for exclusive rights for marketing some of their high-end skin care products in India.