The Hindu Business Line : IT, capital goods help markets bounce back

A wave of fresh buying helped the markets stage a sharp recovery on Friday. Expectations of a correction evaporated as the indices crept steadily upward through the day's trading.

Frontline stocks stole the day again, with the mid-cap indices lagging the Sensex and the Nifty. Market breadth seemed positive with the number of advances overwhelming declines by a factor of two in the BSE 500 basket.

Sector watch

IT and capital goods were the two key sectors to hog the limelight, with the latter staging a smart recovery from the uncertainty of the past week. Frontline IT stocks such as Infosys and TCS, which have tended to trail the markets in the recent bull phase, staged gains on Friday.

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Growth plays in the capital goods space such as Siemens, ABB, L&T, Crompton Greaves and Bharat Earth Movers recovered smartly after volatile trading sessions over the past week.

Within the infrastructure space, makers of power transmission equipment took centre-stage during the day's trading, with practically every stock in this space making smart gains. Kalpataru Power, RPG Transmissions, Jyoti Structures and the newly listed KEC International appreciated sharply.

In contrast, it was a sedate day for retailers and real estate plays. Stocks such as Morarjee Realties, Bombay Dyeing and Pantaloon Retail shed value.

Buzzing stocks

Orient Abrasives, Navbharat Ferro Alloys, Lanxess ABS were some of unusual entrants to the gainers list. Orient Abrasives and Navbharat Ferro Alloys registered gains of 20 per cent and 18 per cent respectively. Specialty chemical maker-Lanxess ABS registered a sharp improvement in volumes traded along with price gains. Others in this space such as Ciba Specialty and Clariant also saw price action, registering a 3 per cent gain.

Event specific action

The Bajaj Auto stock put on Rs 86, a 2 per cent gain, after the company announced major expansion plans. The company plans to spend Rs 1,500 crore over the next three years to expand its vehicle-making capacities from 3.6 million units to 5.1 million. Forays into new segments are also planned.

The Raymond stock rose 2 per cent during the day. The company's board cleared a proposal to expand the worsted suiting capacities at its plant at Vapi.

The Punjab Tractors stock rose 8 per cent. Reliance Mutual Fund has added to its stake in the company in the recent trading sessions.

Television and media stocks were in the limelight after reports of a Supreme Court order requiring the implementation of the Conditional Access System in the major metros. Chennai is the only city to have already implemented the system.

New listings

Gitanjali Gems, which offered shares at Rs 195 during its IPO, slumped below its offer price at the close of trading. The stock closed at Rs 167.

Power equipment maker KEC International re-listed after a restructuring exercise. The stock listed at Rs 425 and closed at Rs 418, after rising to a high of Rs 490 intra-day.