The Hindu Business Line : Oil & power sectors take a beating

TRADING started on an optimistic note on Wednesday as Sensex stayed above 4,800 levels for a while but could not hold on to the gains. By close, it had dipped below the 4,800 level and ended with a loss of 0.5 per cent. Nifty too ended with a loss of 0.4 per cent.

Major losers for the day were mainly from the oil, steel, cement and power sectors, as the price hikes of petroleum products and coal grabbed the headlines. Fears of continuing under recovery and declining margins haunted the oil sector stocks. Stocks of HPCL, BPCL and IOC fell sharply even as the stock of ONGC firmed up.

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Rising prices of inputs such as coal and softening finished product prices seemed to have dampening effect on steel sector stocks. Prices of Tata Steel, Steel Authority of India Ltd, Jindal Steel and Essar Steel eased up.

Stocks of cement sector companies, which would be hit by rising input prices, also recorded declines. Stocks such as Grasim Industries, ACC, Gujarat Ambuja, India Cement and Mysore Cement figured in the loser's list.

Mid-cap stocks specifically from sectors such as capital goods, banking and IT stocks, however, did well on Wednesday. This was reflected in the gains made by Nifty Junior and the lower decline in the index value of CNX Midcap 200 as well.

In capital goods, stocks such as BHEL, Bharat Electronics, Bharat Earth Movers and non-public sector stocks such as Alfa Laval and Lakshmi Machine Works shone. In the IT sector, stocks of MphasiS BFL, Hinduja TMT, Hexaware and Moser Baer notched strong gains.

In the banking sector, stocks such as ING Vysya Bank, Kotak Mahindra and ICICI Bank attracted buying interest. Stocks such as Hindustan Dorr Oliver, Multi-Arc, Welspun Gujarat Stahl Rohren, Berger Paints, Pritish Nandy Communications and Hindustan Composites were in the trading spotlight.

The stock of Hindustan Dorr Oliver rose 7.5 per cent. The company declared a dividend of Rs 1.20 per share after market hours. The stock of Multi-Arc also firmed up by a rupee.

In an extra-ordinary general meeting, resolution for capitalising the firm through preferential allotments were adopted but was reported to the exchange after the close of trading.

The stock of Hindustan Composites firmed up by 2 per cent even as the company disclosed that Rasoi, which held about 54 per cent, had divested just less than 15 per cent to another company.

The stock of Berger Paints shot up 8 per cent in the backdrop of the announcement that the company had declared a dividend of Rs 3 per share on a post-bonus expanded capital in addition to the Rs 3.50 per share declared earlier in the year on the pre-bonus capital.

The stock of Pritish Nandy Communications gained 6 per cent with the company announcing that it has tied up with an overseas company for its wellness business.

The stock of Welspun Gujarat Stahl Rohren strengthened by 5 per cent in the wake of the announcement that it has bagged Rs 407-crore order.

Losers for the day also included stocks such as HDFC, Cipla, MTNL and auto sector majors Tata Motors and Maruti Udyog.

The stock of SBI remained listless even as it announced that the stake of LIC in it has crossed the threshold of 5 per cent.

The stock of Pantaloon Retail shed 2 per cent. Goldman Sachs had sold about 2 per cent of the company's equity. It still continues to hold about 3 per cent.

The stock of Global Trust Bank, plagued by problems of non-performing assets, shed 10 per cent.

The stock is down 20 per cent over the week.