Market ends well off lows

The market came off lower level after an initial sharp fall, shrugging of decision of Left parties to withdraw their support to the Congress-led United Progressive Alliance (UPA) government. The moment the Left front announced their decision in afternoon trade, recovery began on the bourses. FMCG, consumer durables, and IT stocks slipped while capital goods and power stocks climbed. The market breadth was weak
Stocks declined in Asia and Europe after sharp decline in shares of top US mortgage firms Fannie Mae and Freddie Mac on Monday, 7 July 2008, on funding concerns reminded investors about the fragility of global credit markets.
The left's exit is expected to lead to a parliamentary vote of confidence in the government, which hopes the newly enlisted support of the regional Samajwadi Party (SP) will enable it to win such a ballot and avoid calling early general elections. Left parties had for months threatened to end their support if the government pressed ahead with the deal and approached the International Atomic Energy Agency for its approval.
Prime Minister Manmohan Singh on Monday, 7 July 2008 said the UPA government will go through the remaining formalities of the nuclear deal with the US and expressed full confidence that his government will last its full term. SP said on Tuesday it will vote with the government in support of the nuclear deal with the United States.
In Europe, key benchmark indices in France, Germany and UK were down by between 2.26% to 2.29%.
The 30-share BSE Sensex provisionally ended down 155.40 points or 1.15% at 13,370.59. At the day’s low of 13,049.96 Sensex lost 476.03 points in mid-morning trade. At the day’s high of 13,451.67 hit in late trade Sensex lost 74.32 points.
The broader based S&P CNX Nifty was down 37.25 points or 0.92% at 3,992.75 as per the provisional figures.
BSE clocked a turnover of Rs 4,513 crore today 8 July 2008 as compared to Rs 6,784.55 crore on Monday, 7 July 2008.
The BSE Mid-Cap index down 0.41% at 5,317.78, while the BSE Small-Cap index shed 0.3% to 6,573.01.
The market breadth was weak on BSE, with 1394 losers outpacing 1,180 gainers. 81 stocks remained unchanged.
India’s largest private sector firm by market capitalization and oil refiner Reliance Industries declined 2.47% to Rs 1,978.
India’s largest commercial bank State Bank of India rose 3.24% to Rs 1,209.70. It recovered from session’s low of Rs 1,059.40.
Capital goods stocks rose. India’s largest engineering and construction firm by sales Larsen & Toubro rose 1.5% to Rs 2,400.20 as it bagged a Rs 1047-crore order from Railways. It recovered from session’s low of Rs 2,260.80. Bharat Heavy Electricals (up 2.18% to Rs 1,498.25) and Suzlon Energy (up 1% to Rs 196.75) edged higher.
Power stocks also rose. NTPC (up 3.6% to Rs 161.20), PowerGrid Corporation of India (up 2.4% to Rs 78.95), Reliance Power (up 0.96% to Rs 137) edged higher. India’s second largest power utility firm in terms of sales Reliance Infrastructure fell 3.03% to Rs 754.95.
India's second largest software exporter by sales Infosys Technologies fell 3.62% to Rs 1,736.
India’s third largest IT services provider by sales Satyam Computer Services fell 2.99% to Rs 467.55. The company said on Monday, 7 July 2008, it has entered into an alliance with Tyfone, a global provider of mobile financial services, infrastructure and fully-integrated mobile payments capabilities. The two companies will collaborate to provide businesses with an even greater edge when competing in the mobile financial services sector.
Tata Consultancy Services (down 2.97% to Rs 826.70) and Wipro (down 4.61% to Rs 419.70) edged lower.
FMCG stocks declined. ITC (down 3.24% to Rs 171.85) and United Spirits (down 2.52% to Rs 1,100.10) edged lower. India’s largest FMCG major by sales Hindustan Unilever rose 0.07% to Rs 209.60.
Consumer durables stocks fell. Videocon Industries (down 2.99% to Rs 269.10), Titan Industries (down 1.35% to Rs 1,035.70) and Rajesh Exports (down 4.45% to Rs 52.60) edged lower.
ACC (up 6.21% to Rs 527), Mahindra & Mahindra (up 3.92% to Rs 515.80), Hindalco Industries (up 2.18% to Rs 145.40), Ambuja Cements (up 0.81% to Rs 74.50) edged higher from the Sensex pack.
Tata Motors (down 4.13% to Rs 376.35), Grasim Industries (down 3.19% to Rs 1,670.70), HDFC (down 2.14% to Rs 2,010.95), ICICI Bank (down 1.64% to Rs 593.85), Bharti Airtel (down 2.03% to Rs 711.90), edged lower from the Sensex pack.
India’s second largest telecom services provider by sales Reliance Communications fell 1.05% to Rs 415.40. The stock recovered from session's low Rs 395.05. As per reports, talks between Reliance Communications (RCom) and South Africa's MTN Group which are due to end on Tuesday, 8 July 2008, may be extended by three or four weeks. The deal may be structured in a way whereby RCom Chairman Anil Ambani will take 51% in the South African firm through a cash and share swap. Such an arrangement will require more scrutiny by MTN which is the reason why the deadline for the 45-day exclusivity pact might be extended, reports suggest.
Asian markets which opened before Indian market, retreated after sharp declines in shares of top US mortgage firms Fannie Mae and Freddie Mac on funding concerns reminded investors about the fragility of global credit markets. Key benchmark indices in Taiwan, Singapore, Hong Kong, South Korea, Japan were down by between 1.74% to 3.94%. China’s Shanghai Composite rose 0.81%.
US markets edged lower yesterday, 7 July 2008, on concerns that the top two mortgage providers would have to raise even more capital, eroding existing shareholders' stakes further. The Dow Jones industrial average lost 56.58 points, or 0.50%, to 11,231.96. The Standard & Poor's 500 index slipped 10.59 points, or 0.84%, to 1,252.31, and the Nasdaq Composite index dropped 2.06 points, or 0.09%, to 2,243.32.
Oil, India's biggest import, rose by more than half a dollar to nearly $142 a barrel, rebounding from the previous day's near $4 fall as the US dollar weakened.
Source: Capital Market