Edgy week for Indian equity markets

February 23rd, 2008 - 5:32 pm ICT by admin  

A file-photo of Sensex

Mumbai, Feb 23 (IANS) The volatile trend in the Indian equities market continued as mixed cues from global markets over the week kept the Indian market barometer climbing up and down. Out of the five trading sessions, three ended negative. Selling pressure on index pivotals continued.

The BSE 30-share index of Bombay Stock Exchange lost 766.18 points or 4.26 percent to end at 17,349.07 89 Friday.

The S&P CNX Nifty lost 192.15 points or 3.62 percent to 5,110.75.

The BSE Small-Cap index lost 25.72 points or 0.27 percent to 9,595.41.

However, the BSE Mid-Cap index rose 2.37 points or 0.03 percent to 7,594.40.

However, unlike the earlier week where a new IPO was affected by falling markets, the Rural Electrification Corporation IPO that opened for subscription this Monday was fully subscribed within two hours of opening.

The week started with the market edging lower Monday on profit taking. The 30-share BSE Sensex was down 67.20 points or 0.37 percent at 18,048.05. The broader based S&P CNX Nifty was down 26 points or 0.49 percent at 5,276.90.

On Tuesday, after holding ground for most of the day, the market succumbed to selling pressure in late trade, erasing almost all the earlier gain. The 30-share BSE Sensex finally ended at 18,075.66, 27.61 points or 0.15 percent higher than Monday’s close. The broader based S&P CNX Nifty gained 3.90 points or 0.07 percent to close at 5,280.80.

The domestic bourses tumbled on negative cues from the global markets Wednesday. The 30-share BSE Sensex was down 458.06 points or 2.53 percent at 17,617.60. The broader based S&P CNX Nifty was down 126.35 points or 2.39 percent at 5,154.45.

But on Thursday, the market rebounded in late trade to post modest gains. The 30-share BSE Sensex was up 117.08 points or 0.66 percent at 17,734.68. The broader based S&P CNX Nifty gained 37.35 points or 0.72 percent at 5,191.80.

Key benchmark indices tumbled again on Friday as blue chips came under renewed selling pressure. The weakness in Asian stocks triggered the latest round of selling on the domestic bourses. The 30-share BSE Sensex fell 385.61 points or 2.17 percent at 17,349.07. The broader based S&P CNX Nifty was down 81.05 points or 1.56 percent at 5110.75.

IT stocks were saved from the weak market trend as the weakening rupee eased concerns over profit margins.

The BSE IT index rose 0.99 percent to 3,918.28 in the week. Infosys Technologies rose 0.98 percent to Rs.1580.10, TCS rose 2.98 percent to Rs.897.45, Wipro rose 0.51 percent to Rs.422.40 and Satyam Computer rose 0.14 percent to Rs.438.80.

More than 50 percent of the revenues of Indian software companies come from the US. IT stocks also gained momentum on reports that the government might consider fresh tax sops to the export sectors hit by the rupee surge.

According to Securities Exchange Board of India data, in five trading sessions the Indian equity market attracted FII investment to the tune of $790 million.

India’s largest private sector firm by market capitalisation and oil refiner Reliance Industries (RIL) slipped 6.21 percent to Rs.2,429.80 in the week.

The company is reported to be talking to the New York-based Vornado Realty Trust, one of the world’s top five real estate asset managers, to float a $1-billion plus fund.

India’s largest public sector engineering company in terms of profit Bharat Heavy Electricals dropped 8.95 percent to Rs.2,058.85. The company has reportedly bagged an order worth Rs.6.50 billion from General Electricity Company, Libya for setting up a 300-megawatt gas turbine-based power plant.

India’s largest private sector engineering company in terms of revenue Larsen & Toubro slipped 2.91 percent to Rs.3,434. The company said Monday that it had bagged an order worth Rs.12.50 billion from Oil & Natural Gas Corporation.

Anil Dhirubhai Ambani Group firm Reliance Power jumped 8.36 percent to Rs.416.85. Its board will meet Sunday to consider issue of bonus shares. These will be issued to non-promoter shareholders to compensate for the losses suffered by them when the company was listed last week.

In the banking sector, Centurion Bank of Punjab gained 12.6 percent to Rs.56.40 in the week. It is reported to be discussing a merger with HDFC Bank. The share-swap deal, worth over Rs.120 billion, may be worked around the current market price of Centurion Bank shares.

Of the IPOs this week, Bang Overseas opened at Rs.207, Shriram EPC at Rs.290, On Mobile Global at Rs.440 and KNR Constructions at Rs.180.

On Mobile Global got its IPO price on debut and settled at Rs.521.90 on BSE, a premium of 18 percent. The KNR Constructions debut was at a premium of 5.8 percent over the IPO price of Rs.170.

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