The Hindu Business Line : FMCGs firm; Aug sales fuel auto stocks

THE bulls continued their march for the third day as the markets ended with strong gains. Unabated buying by FIIs coupled with active participation by retail investors contributed to the overall market buoyancy. While the benchmark Sensex closed at 7876.2, the broader Nifty settled down at 2405.7.

On Thursday, the markets opened on a strong note and witnessed broad-based buying. Reports of Infosys and TCS likely to bag the multi-year outsourcing deal from the Dutch financial powerhouse, ABN Amro, fuelled the bullish sentiment in the morning trades. The stocks of Infosys and TCS closed 2.1 and 0.9 per cent higher, respectively, on confirmation of the deal.

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There was heightened action in the stock of HT Media, which made its trading debut. The stock, which listed at Rs 685, closed 5.5 per cent higher than its offer price of Rs 530.

The undertone in the markets remained largely bullish. Over 75 per cent of the stocks constituting the BSE 30 advanced in value. Stocks in the mid-cap and small-cap space fared well. Pantaloon Retail was a significant gainer, which was up 12.3 per cent. Other notable gainers included Taj GVK Hotels, Amtek Auto, Mastek, Arvind Mills, MphasiS BFL, Videocon International and SKF India.

Following the trend of most frontline IT stocks, second-rung stocks also joined the rally. Those that moved up sharply were Ramco Systems, Geometric Software, Polaris, Cranes Software, Flextronics and Scandent Solutions.

Price hikes announced by Tata Steel, SAIL and National Aluminium spurred up interest across the counters of these stocks. While SAIL and Tata Steel gained 1.8 and 0.7 per cent, respectively, Nalco closed 2.2 per cent higher. Others that attracted widespread buying interest included Uttam Galva, Hindustan Zinc, Madras Aluminium, Vesuvius and Essar steel.

Stocks of HMT, Honda Siel, Havell India, SKF India, Praj Industries and Crompton Greaves were notable gainers in the capital goods sector. However, KEC International, Alfa Laval and Dredging Corporation remained subdued.

Select FMCG stocks such as CCL Products, Colgate Palmolive, Britannia, Radico Khaitan and HLL ruled firm, while Tata Coffee, Nirma and McDowell ended weak.

It was a good day for pharmaceutical stocks, which put up a smart show. Ajanta Pharma was a significant gainer whose stock shot up by 9.9 per cent. Others that rallied sharply were Ranbaxy, Cipla, Matrix Lab and Shasun Chemicals. However, Dr Reddy's, Biocon, Morepen Lab and Pfizer failed to buck the trend.

There was selective buying among the banking sector stocks. Prominent gainers were ICICI Bank, Indian Overseas Bank, SBI, Oriental Bank and Andhra Bank. Those that suffered losses included HDFC Bank, Bank of India and Union Bank.

There was hectic activity across the counters of auto stocks on the back of announcement of good sales numbers for August. Bajaj Auto was up by 2.9 per cent after the sales of its vehicles registered a 34 per cent increase in August. Hero Honda gained 2.6 per cent after its sales volume for August rose by 27 per cent. Maruti, TVS Motor and Punjab Tractors also netted handsome gains.

Few of the oil and energy stocks that recorded gains were Chennai Petroleum, BPCL, HPCL, GAIL, Reliance and IOC. Those that came in for selling pressure were ONGC, Essar Oil and Hindustan Oil Exploration.

Other notable gainers on the Nifty were Amara Raja Batteries, Container Corporation, Berger Paints, Corporation Bank, IVRCL, Raymond, Siemens and Visaka Industries.

Prominent losers were Apollo Tyres, Asian Paints, Balaji Telefilms, Escorts, India Cements, Macmillan, Monsanto and Thermax.

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