The Hindu Business Line : Infotech stocks drive rally in large-caps

THERE'S something about a Friday that appears to get the markets all excited. For the third time in four weeks, the markets ended the last trading day of the week with gains. It also marked the third straight week that the markets had closed the week in positive territory.

The benchmark BSE Sensex gained 55.93 points to close at 6,633.76; the Nifty added 18.70 points to end the day at 2,082.05.

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IT stocks were the prime drivers of the indices, with Reliance providing the additional momentum. Stocks of hospital companies - led by Apollo Hospitals - were marked up sharply across the board.

Advancing stocks outnumbered declining stocks by 33 in the BSE A group. In contrast, in the mid-cap dominated B1 group, advancing stocks trailed declining stocks. Overall, the two categories were evenly matched. That it was a day for the large-caps (the Nifty was up by 0.9 per cent) was also reflected in the S & P CNX Mid-Cap - the index that has sizzled in recent months - sporting gains of about 0.5 per cent.

IT stocks had a fine outing with the frontline players - Infosys, TCS, Wipro and Satyam Computer - ending the day on a firm note. The S&P CNX-IT Index rose by about two per cent.

Several indications that a more-robust-than-expected trend may prevail in the US economy over the next couple of quarters appear to have acted as a trigger. Even among the second-rung players, only Ramco Systems, Cranes Software and Hinduja TMT closed on a weaker note.

Auto sector stocks - straddling four-wheelers, two-wheelers and auto components - exhibited a firm undertone with Maruti, Hero Honda, Bajaj Auto and Mahindra & Mahindra in the forefront.

Rico Auto and MICO were marked even as Sundaram Clayton, which has been on a protracted bullish phase, shed value due to profit taking.

Cement stocks, which have been on a roll, took a breather. The likes of Gujarat Ambuja Cement, ACC and UltraTech Cement were among the few large-cap stocks that declined. The downward trend also encompassed potential consolidation candidates such as Prism Cements and India Cements, though trading volumes continued to remain heavy. The only stock to buck the trend and rise sharply was Kakatiya Cement. Grasim ended on a flat note.

A similar trend was visible among steel stocks too. Even as most of them - Ispat Industries, Essar Steel and Jindal Vijayanagar - topped the volume charts, they sported moderate declines. SAIL, which bucked the sector-specific trend, was a notable gainer in the Nifty while Tata Steel was flat. Stocks such as Tata Sponge also ruled week.

Quite a few stocks from the textiles space were on a firm wicket. The likes of Raymond, Bombay Dyeing, Rajasthan Spinning and Ruby Mills were among the notable gainers.

Stocks of real estate developers - Mahindra Gesco and Morarjee Realty - sported healthy gains, driven by indications of policy announcement on FDI investment in the sector.

A few construction (Gammon India and Unitech) and stocks of associate banks of SBI India sported sizeable gains.

Notable in price action driven by company-specific developments were:

* Markets have taken a sanguine view of HLL's revenue numbers ignoring the 33 per cent decline in earnings. The stock was up one per cent.

* SKF India rose sharply as its parent company has indicated its intent to buy out non-promoter shareholding and delist the stock. As pricing would have to be determined by reverse-book building, a buoyant trend was evident on expectation of an attractive exit price.

* Markets have responded favourably to Tata Tea's plans to restructure its business plans and sell/lease its plantations.

* Expectations of a hefty dividend lifted the Sulzer India stock.

* Lakshmi Vilas Bank was fancied on news of possible interest by foreign banks.

An upward momentum was maintained in Sesa Goa, Gujarat NRE Coke, Aban Loyd and Astra Microwave, while the likes of Max India, Matrix Labs, Siemens, Arvind Mills and Moser Baer lost steam during the day's trading.

Other prominent gainers were Titan, Reliance Capital, Aurobindo Pharma, Apollo Hospital, Karur KCP Packaging, Hatsun Agro, Elgi Tread, Orient Paper, Indraprastha Hospital and Financial Technologies.

Notable losers were Mukta Arts, Exide, ETC Networks, Saint Gobain Sekurit, Praj Industries, Shaw Wallace, JK Corp, IDBI, Procter & Gamble and Goetze India.

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