The Hindu Business Line : Mid-cap stocks maintain momentum

IT has been a pretty good week for the markets after a weak start. The markets moved in positive direction for the third straight day gaining over 100 points in the last three trading sessions. The Sensex gained 46.89 points to close at 5135.45 points. The Nifty rose 15.06 points to 1610.75 points.

The day's trading was characterised by a number of block deals. The mid-caps outperformed the brad market for yet another day. Quite a few mid-cap stocks zoomed in excess of six per cent.

After a good debut on the stock markets, Tata Consultancy Services slid on the second day of listing. Number of sellers still exceeded the number of buyers for the stock. The stock witnessed selling pressure from investors who were probably looking at making some quick buck from the offer. The stock closed at Rs 979.

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Stocks of textile machinery manufacturing companies were one of the favourites for the day. Not only did the stock of industry leader LMW, but the stocks of other lesser-known companies such as Veejay Lakshmi, Schalforst Engineering and India Card Clothing too were very bullish. LMW gained 3 per cent, Schalforst touched the upper circuit of 20 per cent and Indian Card gained 7.3 per cent.

Banking stocks such as PNB, Corporation Bank, Union Bank and SBI were also upbeat.

Stock such as IOC and Pidlite Industries went up after they declared a handsome dividends. IOC has declared a dividend of Rs 16 per share and Pidlite Industries Rs 8 per share. The stocks gained five per cent and two per cent respectively.

M&M declined marginally as the company's production at its plant at Nashik has been affected due to the truckers' strike. The stock closed down 1.7 per cent at Rs 417.

Parry Confectionary, Mercator Lines and Raymond were other losers.

The stock of Texmaco, a manufacturer of railway wagons, rose 10 per cent. The stock has been in the limelight after it bagged orders from the railways. The good order book has been driving the stock.

The Bombay Dyeing stock zoomed 8.3 per cent to Rs 155 despite a foreign GMO emerging market fund offloading 7.8 lakh shares in a block deal.

Berger Paints is to consider amalgamation of Berger Auto & Industrial Coatings with the company. The stock rose 7.2 per cent to Rs 29.

Titan Industries gained 4.4 per cent to Rs 143. The stock has been witnessing a buying spree for some time. The company announced that it has commenced production at its Baddi Unit at Himachal Pradesh, which will be eligible for direct and indirect tax concessions. This could have further pepped up the stock.

Among the engineering segment, KSB Pumps, Greaves, Crompton Greaves and Praj Industries remained firm. The stocks in the capital goods sector have made a smart turnaround after the sharp decline in May. Companies such as Praj, Crompton Greaves and Greaves have given handsome returns in the past 3-4 months.

Among the Sensex stocks, BHEL, Reliance and Ranbaxy were major movers. The stock of BHEL recorded a 4.3 per cent gain to close at Rs 570.

The gainers with big volumes for the day were UltraTech Cemco, Aftek Infosys, Hindustan Oil Exploration, IDBI, Neyveli Lignite, Bharuka Steel and Wimco.

A few stock that gained in excess of 10 per cent were Maars Software, Crest Communications, KCP Sugar, Ponni Sugars, Hindustan Sintex, Automotive Stampings, Berger Paints, ETC Network, FACT, Orient Paper, Gujarat NRE Coke and Automotive Stampings.

Stocks such as Century Extrusions, Orisa Sponge, Jayshree Tea and Speciality Paper gained over 7 per cent. Apollo Tyres, Balrampur Chini, Bata India and Blue Dart are a few other gainers.

ITC Hotels tanked 16 per cent during the day to Rs 121. The swap ratio for the merger of ITC Hotels with ITC is perceived to be unfavourable, as it does not offer arbitrage opportunities.