The Hindu Business Line : Index heavyweights propel market

EXPECTATIONS of good earnings announcements by corporates, indications of a cooling down in inflation and greater FII inflows, have the markets upbeat.

The markets soared on Friday, registering their highest weekly gain in 19 weeks. The BSE Sensex surged well past the 5500 mark, buoyed by buying interest in the index heavyweights, and ended the trading session at 5561.15, 83 points or 1.5 per cent higher than its previous close. The bellwether has gained 3.56 per cent in the last week. The Nifty appreciated by 1.64 per cent to 1733.65; up from the previous close of 1705.70.

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The Sensex began on a strong note at 5489.12 and stayed in the positive territory throughout the buying session. Eighty per cent of the stocks constituting the Sensex advanced, a measure of the bullish sentiment. The stocks of heavyweights, Reliance, ICICI Bank and SBI gained more than 3 per cent each, propping up the benchmark index. Stocks that declined were Infosys, Satyam, Ranbaxy, ACC, Hero Honda and Dr Reddys.

Large-cap stocks saw most of the action on Friday. The broad based indices such as BSE 500 and CNX Midcap 200 gained to a lesser extent that the Sensex and Nifty; the CNX Midcap 200 gained only 0.28 per cent.

In terms of sector preferences, banking, steel and auto sectors were in favour, while IT stocks took a backseat. Stocks belonging to the steel and related sectors gained; SAIL, Essar Steel, Tata Steel and Ispat Industries were among the gainers. Banking stocks surged ahead with ICICI Bank, SBI, Bank of India and Centurion Bank gaining smartly. Among the auto stocks, Tata Motors, Maruti Udyog and Mahindra & Mahindra were in the limelight.

Stocks that figured prominently in the losers list include Maars Software, SPIC, Rama Newsprint, Uniphos Enterprises and Godavari Fertilisers. These stocks registered a fall on the back of profit booking.

Tata Motors gained Rs 17 or 4.28 per cent to close at Rs 405.75. Trading volumes surged from 10.41 lakh on Thursday to about 21.98 lakh shares on Friday. The gains come on the back of news that the American depository receipt of Tata Motors is to be listed on the New York Stock Exchange by this month end.

Aban Loyd Chiles gained Rs 22 to close at Rs 1123.25 on the news that the company has received Letters of Intent from ONGC for drilling contracts for a period of three years.

Welspun Gujarat Stahl Rohren ended the trading session higher by Rs 2.8 at Rs 40.7. The gains could be in the backdrop of the company having clinched an order worth over Rs 500 crore for supply of pipes for a pipeline project in the US.

Union Bank of India and Bank of India gained on reports that the banks were in talks for a possible merger. Both the banks have, however, denied the rumours in announcements to the BSE. The stocks of Union Bank and Bank of India gained Rs 0.6 and Rs 4.1 to close at Rs 72.55 and Rs 51.65 respectively.

Chambal Fertiliser gained Re 05 to close at Rs 21.95, while India Steamship slid marginally to Rs 11.40. India Steamship is to be merged with Chambal Fertiliser. The shareholders of the former would get 11 shares of Chambal for every 20 shares held by them.

Cadila Healthcare gained Rs 1.3 to close at Rs 528.40. This gain could be in the backdrop of the company's subsidiary Zydus France SAS, launching 43 generics in the French Market.

Other stocks that gained on strong volumes include Pudumjee Agro, J K Synthetics, Chemfab Alkalies, Maral Overseas, Bharat Gears, Nava Bharat Ferro Alloys, and Raymond, to name a few.