The Hindu Business Line : May begins on a good note for markets

The markets opened on a strong note for the month of May with the bulls continuing to wield the upper hand. Most of the sector-oriented indices on the Bombay Stock Exchange (BSE) closed in the positive territory. A strong bullish sentiment prevailed in the metal, pharma and banking indices. The bullish sentiment was underlined by the advances-declines ratio.

Buzzing stocks

Titanor Components, DCW, Flex Engineering, Flex Industries and Bharati Shipyard that drew significant buying interest were among the prominent gainers on Tuesday.

Sector watch

PLR (prime lending rate) hikes by banking majors appeared to have rubbed off well with the market participants. Bulls swamped the banking sector with a majority of the banking stocks closing in the green. Prominent gainers included Bank of India, Bank of Baroda, Andhra Bank, IndusInd Bank, Vijaya Bank and UTI Bank. UCO Bank and Kotak Bank, however, bucked the trend.

A buoyant trend in global metal prices continued to sway sentiment on the counters of prominent metal stocks. Aluminium stocks such as Hindalco and Madras Aluminium, supported by buying activity, surged ahead by 5 per cent. National Aluminium also gained by about 2 per cent.

Click here for table

Steel stocks were not far behind; stocks such as Lloyd Steel, Jindal Steel, Mukand, Nava Bharat Ferro Alloys and Southern Iron recorded sharp gains. Other metal stocks such as Hindustan Zinc, Hindustan Copper and Sterlite Industries also gained.

Frontline stocks in the healthcare sector marched northwards at a scorching pace. Accompanied by a 16-fold rise in volumes, Ranbaxy surged ahead by 10 per cent. Dr. Reddy's, which was among the most active stocks in the pharma space, gained about 17 per cent. Earlier in the day, the stock touched a new high of Rs 1,700. The bullish sentiment on the pharma majors appears to have set in on reports that a court ruling in the US would pave the way for these companies to sell a generic version of a cholesterol drug in the US.

Other prominent gainers in the pharma space included Strides Arcolabs, AstraZeneca Pharma, Gufic Biosciences, Ipca Laboratories, Solvay Pharma and Venus Remedies.

A mixed trend could be gauged in the chlor-alkali sector. Gujarat Alkalies, Bihar Caustic and Chemfab Alkalis registered sharp gains. Siel was another prominent gainer. The stock has doubled in the space of seven trading days on the back of a sharp rise in volumes. Andhra Sugars registered a sharp decline of about 4 per cent.

Widespread gains were registered in the plantations sector. Tata Coffee and Bombay Burmah that own both tea and coffee plantations closed with gains of 2 and 3 per cent respectively. Prominent gainers in the tea sector included Assam Company, Goodricke, Parry Agro and McLeod Russel. CCL Products, after weeks of sideways movement, registered a sharp 10 per cent gain.

Event-specific action

Supported by a surge in volumes, Tata Tea registered a 3.4 per cent gain. Buying activity set in after the company said its subsidiary Tata Tea (GB) has signed an agreement to acquire JEMCA, a tea company in the Czech Republic.

Jet Airways, which opened on a strong note, failed to evoke interest among participants, as they appeared to be unenthused by the airliner's fourth quarter earnings. The company reported a 25 per cent growth in revenues and a 70 per cent rise in earnings for the March quarter.