The Hindu Business Line : Markets take a breather; Sensex gains

Trading highlights
948 stocks hit new 52-week lows
Advances-declines ratio at 2:1
Total market capitalisation still at January-2006 levels

The markets took a breather off the bear run, most indices on the BSE and the NSE recorded significant gains. The 515-points gain on the Sensex, however, failed to translate into anything considerable for the broad markets. The rally was restricted to select counters — frontline stocks and stocks that took a pounding. On Friday, wealth only to the extent of Rs 1.3 lakh crore was created in the markets. While the FIIs and broking community returned to the market, Friday witnessed a fresh round of selling activity by the investing public.

The mixed sentiment that prevailed in the market could be gauged from the advances-declines ratio. About 38 per cent of the stocks listed on the BSE hit new 52-week lows on Friday. Penny stocks occupied a large portion of this pie. However, quite a few frontline stocks also figured in this list. Notable among them were IOC, BPCL, CPCL, and Nicholas Piramal.

Buzzing stocks

The sharp value erosion in frontline stocks triggered off a wave of buying activity. Volumes were up on most counters of the Sensex constituents. Reliance Industries led the rally on both the Sensex and Nifty. Other large cap stocks, which witnessed a bout of buying interest, included Tata Steel, L&T, IPCL, ACC and ITC.

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Those that topped the volume activity list in the mid-cap and small-cap space included Nagarjuna Fertilisers, Indiabulls, Arvind Mills, Jai Prakash Hydro, IFCI and DCW. Crew BOS, which opened at 52-week low, also attracted significant buying interest. The stock closed with a gain of about 20 per cent.

Sector-focus

Despite the sharp gains in most banking stocks, the BSE Bankex failed to make significant movement. The rally in the banking sector was restricted to mid-cap counters. SBI and ICICI Bank closed flat, while HDFC Bank inched up by only three per cent. Kotak Bank, Canara Bank, Karnataka Bank, Bank of India and Union Bank were among the top gainers in the industry.

The metals sector, which took a pounding in the recent sessions, recovered a part of its declines. Steel stocks were among the top gainers in the sector. Jindal Stainless and Jindal Steel registered smart gains. Others that ramped up gains in the steel space included stocks such as Mahindra Ugine, Man Industries, Uttam Galva, Mukand and Maharashtra Seamless. In the non-ferrous space, Hindustan Zinc and Sterlite Industries gained more than 10 per cent. The aluminium space, however, was a mixed bag - while Hindalco and National Aluminium registered modest gains of five per cent Madras Aluminium shed value.

A mixed sentiment prevailed in the infrastructure space. Buying activity was evident in the cement sector. This was, however, restricted only to a few in the construction space. The sharp gains in Mahindra Gesco, Madhucon Projects and Nagarjuna Construction was tempered by declines in Era Construction, Patel Engineering and Unitech, which continued their downward spiral. Across the board gains were registered in the cement space; frontline stocks such as Birla Corp, Gujarat Ambuja, India Cements and Madras Cements registered smart gains.