The Hindu Business Line : Late-hour buying props up benchmarks

Volatility ruled the markets on Monday with the Sensex swinging over 250 points during the trading session. Markets carried forward last week's pessimism on the run-up towards the Union Budget. However buying at lower levels, towards the end of the trading session propped up the market to close marginally higher. The Asian markets also closed a mixed bag.

The day's rally was led by sectors such as metals, FMCG, pharma and auto. The gain was also reflected in advancing stocks outnumbering the declining stocks by a ratio of 1.2:1.

Railway Budget and impact

The Rail Budget's proposal to spend Rs 30,000 crore to build dedicated freight lines had a positive impact on a number of vendors of railway equipment and related service providers. Bharat Earth Movers, which makes rail coaches, added Rs 32.8 to Rs 1,128.5. Stone India also rose 3.5 per cent. Logistics players such as Container Corporation of India and Gateway Distriparks rose on the positive news of huge investment on freight lines.

The market also appeared to cheer cement stocks on the back of the Railway Budget's announcement to leave freight rates unchanged in order to compete with the road transport and ease pressure on inflation. Leading players in the sector, Gujarat Ambuja Cements, ACC and Grasim Industries all gained over 3 per cent.

Buzzing stocks

Despite weakness, quite a few mid- and small-cap stocks managed to hit the upper-end of their circuit filters. HOV Services, ORG Informatics, SSI and Mcnally Bharat hit their upper circuits during the day and close at the same level.

Power Finance Corporation, Steel Authority of India, ITC, Tata Teleservices and IDFC were some of the stocks that rose on the back of huge surge in volumes.

Sector focus

The BSE Metal index was the biggest gainer among the sector indices at the BSE. The index added 2.3 per cent with Hindustan Zinc being the main propeller, surging by 8 per cent. JSW Steel, Tata Steel, Jindal Saw and National Aluminium Company were other key gainers in the metal index.

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The BSE FMCG index also rallied smartly with stocks such as ITC, United Spirits, Marico and Tata Tea witnessing active buying interest.

Stocks in the capital goods segment remained weak even as the Budget expectations for this sector appeared positive. Larsen & Toubro, Kalpataru Power Transmission and ABB closed in the red. Bharat Heavy Electricals won an order worth Rs 144 crore from Power Grid Corporation for setting up a power transmission sub-station in Maharashtra. The stock, however, declined by about one per cent. Areva T&D and Crompton Greaves bucked the trend and moved northward.

Stock-specific action

Zensar Technologies surged 5.8 per cent after it bought a unit of US-based SOA Software. The acquisition is likely to give the company access to clients in the media and communication segment.

C&C Constructions made its debut on the BSE and the NSE. It fell 14 per cent below its offer price of Rs 291 and closed at Rs 239.9, 17 per cent lower than the offer price.

Ruchira Papers, Sterlite Optical Technologies, IVRCL Infrastructures and BL Kashyap & Sons were key gainers at the NSE while KEI Industries, Pochiraju Industries, Cambridge Technologies and Ceat were conspicuous losers.