The Hindu Business Line : Record-breaking run continues

THE markets witnessed another record-breaking run on Monday with both the Sensex and Nifty creating new highs. Continuous net buying by foreign institutional investors, impressive corporate results and the normal monsoon boosted market sentiment.

The Sensex started on a flat note but made a quick rally to reach an intra-day high of 7526.8 and later settled at 7505.6 — up 82.4 points or 1.1 per cent. The S&P CNX Nifty closed at 2291.8, a gain of 24 points or 1.2 per cent.

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Banking stocks were in the limelight throughout the day. The BSE Bankex was up 4.5 per cent and the Bank Nifty followed its counterpart with a surge of 4 per cent. The banking sector was driven by optimism over a possible increase in interest rates to be announced by RBI. Barring the IT and pharma stocks, most of the other sectors witnessed a bullish activity.

In the Sensex basket, ICICI Bank, NTPC, HDFC Bank and ONGC were prominent gainers, while stocks of Satyam, Hero Honda, Reliance and Dr Reddy's Laboratories declined.

Frontline stocks such as Infosys, Wipro and TCS also succumbed to bearish pressure. In the capital goods sector, Astra Microwave Products surged by 4.6 per cent to close at Rs.2420.5, after it proposed to offer bonus shares in the ratio of one equity share for every share held.

Praj Industries announced a two-fold increase in its first quarter earnings. The company's stock surged by 1.1 per cent to Rs 816.5. Larsen & Toubro, Siemens and Kirloskar Brothers, however, ended in the red.

Hospitality stocks saw firm trading. After strong results announced last week by Indian Hotels, the company's stock were marginally up 0.5 per cent. Taj GVK rallied smartly to close at Rs 450 — up by 3 per cent. ITC Hotels also managed to gain by 1 per cent, while Hotel Leelaventure stayed out of the rally.

It was a gloomy day for the pharma sectors. Matrix Labs and Strides Arcolab declined by more than 3 per cent. The proposed merger between the two companies was earlier called off after an agreement on valuation could not be reached.

Shasun Chemicals also fell by 2 per cent to close at Rs 424. Its fourth quarter profits rose marginally by 8.7 per cent.

The mood in the banking sector was upbeat. While Indian Overseas Bank and ICICI Bank surged by 8 per cent, Punjab National Bank, UTI Bank and Bank of India also moved upwards.

UltraTech Cement shares rose 7.8 per cent to close at Rs 389.6 after the company announced a profit of Rs 60 crore for first quarter ended June 2005 against Rs 11.2 crore in the year-ago period.

BHEL has bagged a $100-million order to build an electricity generation plant for Indonesia's PT Merak Energi group. The company's shares, however, rose by less than 1 per cent to close at Rs 995.8.

Conspicuous gainers in the Nifty constituents include GE Shipping, Moser Baer and Ashok Leyland.

Polaris, Macmillan, Asian Paints and Vijaya Bank were some of the losers.

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