Suresh Krishnamurthy

STOCK prices sustained the momentum gained on Tuesday and ended Thursday with larger gains. The rally on Thursday was much more broad based with nearly 160 out of the 203 A-group stocks ending the day with gains.

The BSE Sensex and theNSE's S&P CNX Nifty ended the day with gains of about 1.2 per cent. CNX Midcap index gained 2.1 per cent reflecting the across-the-board rise in mid-cap stocks. Stocks of technology and healthcare were especially in the limelight with the prices of a number of stocks from these sectors vaulted to higher levels.

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Stocks of banks remain subdued and registered only marginal gains.

Spotlight on results: Trading spotlight remained on the financial performance announced by companies as earnings surprises continued to be built into the stock price. Stocks of companies such as Chambal Fertilisers, Arvind Mills, Bharti Tele-ventures, Asahi India Glass, HPCL, Siemens and GE Shipping benefited from the announcement of `above-average' earnings growth. Stocks of Banks such as Canara Bank and Bank of India that reported decline in profit growth registered declines.

Healthcare and Textiles rise: The operating environment for healthcare and textile companies is slated to change consequent to an agreement with the World Trade Organisation. A number of stocks from these two sectors rose in value on Thursday. Stocks of healthcare companies such as Lupin, Torrent Pharma, JB Chemicals and Abbott Pharma rose more than 5 per cent. Stocks of textile companies such as JCT, Nahar Spinning, Maral Overseas and Hindoostan Spinning gained more than 10 per cent.

Mid-cap technology surge: Major gainers on Thursday include stocks such as Hexaware, i-Flex, Subex Systems and Hughes Software. These stocks also made announcements that were viewed favourably by the markets.

Core sector shines too: Stocks of companies in sectors such as steel, capital goods and fertilisers also gained in value. Stocks such as Jindal Vijayanagar Steel and Ispat Industries from steel and stocks of Praj Industries, Crompton Greaves, Siemens and Alstom gained more than 3 per cent. Stocks of fertilizer majors such as Rashtriya Chemicals, Gujarat State Fertilisers and Chambal Fertilisers gained more than 4 per cent.

Divergent trend in banks: On Thursday, select stocks from both public and private sector gained value even as a majority of them stayed on the sidelines. Stocks of Union Bank of India, Andhra Bank, UCO Bank along with the stocks of their private sector counterparts such as Kotak Mahindra, UTI and HDFC Bank gained in value. The largest banks in India ICICI Bank and State Bank of India, however, lost value.

PSUs stay subdued: While all stocks of hues and colour made merry on Thursday, stocks of public sector enterprises stayed subdued. Stocks such as Chennai Petroleum, Bank of Maharashtra, NTPC, Indian Oil and Dredging Corporation graced the list of losers.

News and stocks: The stock of Pidilite Industries gained 4 per cent. The company announced the acquisition of a Singapore-based company. The stock of Dwarikesh Sugar, which has announced a programme for the expansion of its capacities, also gained 4 per cent. The stock of Southern Ispat shot up by 9 per cent in the wake of the announcement of a bonus offer. The stock of Tata Chemicals rose by 2 per cent. The company's convertible bond offering made in overseas markets was subscribed within minutes of its opening.

(This article was published in the Business Line print edition dated January 28, 2005)
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