Financial Daily from THE HINDU group of publications
Friday, May 27, 2005
Financial Daily from THE HINDU group of publications Friday, May 27, 2005 |
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Markets
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Commentary Columns - Sensor Buying in IT, pharma sustains bull rally Radhika Kamath
THE bull rally on the markets continued for the sixth day as the Sensex closed with a gain of 73 points, while Nifty was up by 31 points. Strong buying interest in the frontline stocks and huge short covering in the last hour of trade helped the markets post gains. The Sensex opened on a flat note and witnessed some volatility during the late morning session, particularly on account of weakness in oil and refineries stocks. However, renewed buying in the frontline IT, pharma, consumer goods, and auto stocks lifted the benchmark index towards the closing hours of trade. The Sensex finally closed at 6,676.3 while the Nifty settled down at 2,074.7. The overall sentiment was positive as the advances to decline ratio was heavily tilted in favour of the advances at 3.2 on the BSE 30-share index. While there was active buying interest among the frontline stocks, the mid-cap and the small-cap stocks witnessed sharp selling pressure. The BSE Mid-cap lost by 0.1 per cent while the BSE Small-cap was down by 0.5 per cent. There was widespread action among the consumer goods stocks, which accounted for a major part of the day's gains. BHEL added Rs 39.7 to its stock to close at Rs 909.8. The gains were on the back of the Government's announcement that it will sell its 10 per cent stake in the company to raise money for social spending. Others that gained sharply were Alstom Projects, Thermax and ABB. L&T, BEML and SKF India posted moderate gains. IT stocks also saw strong buying interest. Mirroring the gains made in these stocks, the BSE IT Index was up 1.3 per cent. Infosys, which completed its ADS sale of domestic investors at a premium price of 34 per cent, saw the stock move up by 1.3 per at its close of Rs 2,201.4. Wipro, Rolta, TCS, and HCL Technologies also posted smart gains. However, Satyam, Polaris, Hexaware, MphasiS BFL and Geometric Software were subdued. Buying interest continued among the pharmaceutical and healthcare stocks. Dishman Pharma surged by 5.5 per cent while Matrix Lab, Ranbaxy, Dr Reddy's, Cipla, Divi's Lab and Orchid Chemicals ended in positive territory. However, Glenmark, Novartis, Elder Pharma, Morepen and Cadila ruled weak. Metal stocks exhibited a mixed trend. Welspun Gujarat Stahl-Rohren shot up by 7.5 per cent. Lloyd Steel, Tata Steel, and Madras Aluminium recorded marginal gains while Jindal Steel, Jindal Vijaynagar, Sesa Goa, Ispat, and Bhushan Steel eased off. There was profit booking among the oil and refineries stocks after the Government deferred the proposal to allow State-run refineries to raise retail fuel prices, adding to the concern of increasing revenue losses. BPCL and Chennai Petroleum lost three per cent on an average. Kochi Refineries, HPCL, IOC and Hindustan Oil Exploration also bore the brunt of selling pressure. ONGC and GAIL managed to stay in positive territory. Most of the banking stocks also took a beating. Indian Overseas Bank, HDFC Bank, UTI Bank, UCO Bank, Union Bank and Vijaya Bank ended the day in the red. Oriental Bank of Commerce, which announced a marginal rise of four per cent in fourth-quarter profits, also closed 0.4 per cent lower.
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