Tuesday, October 23, 2007

Sensex ends up over 850 pts; biggest single day point gain

After taking a small pause the bulls are back again and back with style. The markets opened strong and the bulls gradually took it higher making it the biggest ever gain for the Sensex closing near the high point of the day. The rise was incredible and ferrocious with Sensex adding around 900 points and Nifty up nearly 300 points. Volume has been extremely impressive on account of broad base participation by the investors.

Sensex was up 878.85 points or 4.99% at 18492.84, and the Nifty up 288.30 points or 5.56% at 5472.30.

Television media reports in mid-afternoon trade that the market regulator Securities & Exchange Board of India (Sebi) has cleared proposals allowing foreign individual investors to invest on Indian bourses aided the surge in the second half of the trading session. The minimum networth criteria for a foreign individual investor who intends to invest directly is set at $50 million, television reports suggest.

India's largest private sector entity by market capitalisation and oil refiner Reliance Industries (RIL) galloped 7.52% to Rs 2595 on 11.59 lakh shares. As a part of a restructuring exercise, RIL has reportedly decided to hive off Reliance Fresh into a separate company, Ranger Farm, for single point accountability. Reliance Fresh sells food, fruits and vegetables and consumer products.

Battered Reliance Energy and Bharti Airtel made a strong comeback. Reliance Energy, the country’s second largest power utility company in terms of sales surged 12.28% to Rs 1538.25 on 26.78 lakh shares. The stock gained on value buying after it had plunged 28.06% to Rs 1370 in past one week to 22 October 2007.

India’s largest listed cellular services provider by sales, Bharti Airtel gained 7.08% to Rs 993. The stock had slipped 16.41% to Rs 927.65 in the past one week to 22 October 2007, hit by on concerns that the launch of nationwide GSM services by rival Reliance Communications would eat into its market share.

Meanwhile Reliance Communications rose 4.80% to Rs 755. On Friday, 19 October 2007, it got nod to launch nationwide GSM-based cellular services from Department of Telecom (DoT).

India’s largest engineering company by sales, Bharat Heavy Electricals (Bhel) jumped 11.82% to Rs 2300.Larsen & Toubro (L&T), the nation's largest engineering and construction company by sales, surged 7.69% to Rs 3336. On 18 October 2007, L&T said it won four orders worth Rs 452 crore for projects in Andhra Pradesh.NTPC (up 9.36% to Rs 218.40), Hindustan unilever (up 4.15% to Rs 215), Cipla (up 7.30% to Rs 193.40), and Tata Steel (up 6.97% to Rs 895.70), were the other gainers.Banking heavyweights ICICI Bank (up 3.36% to Rs 1098), HDFC Bank (up 6.75% to Rs 1465), and State Bank of India (up 5.27% to Rs 1803), also rallied.

IT pivotals underperformed the market. India’s top software services exporter TCS lost 0.98% to Rs 1063.90 on 4.49 lakh shares. It was the top loser.Infosys (down 0.38% to Rs 1879.55), and Wipro (down 0.56% to Rs 492) underperformed the market. The Indian rupee firmed against the dollar. It was hovering at 39.64, as compared to yesterday’s (22 October 2007) close of 39.88.

India’s fourth largest software services exporter Satyam Computer Services gained 3.49% to Rs 464.10 after hitting day’s high of Rs 469. Its net profit rose 7.19% to Rs 417.15 crore on 10.75% rise in sales to Rs 1948.24 crore in Q2 September 2007 over Q1 June 2006. The company declared the results before market hours today, 23 October 2007. The company revised upwards earnings as well revenue guidance for FY 2008 (year ending 31 March 2008), both in rupee terms and dollar terms.

Satyam Computer Services signed an agreement with Fujitsu Services to provide IT services to Reuters as part of a 10-year, $1 billion internal information systems transformation programme. It also announced that entering into a definitive agreement to acquire 100% stake in Nitor Global Solutions ("NITOR") of the UK, a niche consulting firm providing Infrastructure Management Services (IMS), for up to British pound (GBP) 2.76 million ($ 5.5 million) in cash.

Among side counters, LIC Housing Finance (up 20.50% to Rs 272.50), Bank of India (up 23.79% to Rs 318.70), Hercules Hoists (up 20% to Rs 4318.85), Reliance Capital (up 15.84% to Rs 1768.15), and Mercator Lines (up 15.83% to Rs 98.40), surged.



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