Auto stocks lend power

STOCKS REPORT

Old economy pivotals, especially those from the automobile and metal sectors, were in the limelight helping the Sensex register gains for the third consecutive day.

Select buying in blue chips helped the market close in the positive territory.

Recording modest gains, the Bombay Stock Exchange (BSE) Sensex closed with a gain of 19.03 points at 5,842.20. The National Stock Exchange (NSE) Nifty gained 7.70 points to close at 1,860.40.

The breadth of the market was negative with losers outpacing gainers in the 904:758 ratio. Hero Honda Motors rose 1.5 per cent to Rs 525.15, Bajaj Auto was up 3.4 per cent to Rs 960.40, Tata Motors was up 2.55 per cent at Rs 536.95 and Mahindra and Mahindra jumped up 2.93 per cent to Rs 488.50.

An analyst at a local brokerage said, "Two-wheeler stocks were up on expectations of strong volume growth after auto firms reporting higher sales for February."

Industry watchers added that rising disposable incomes in a booming economy along with low interest rates have created more buyers.

Grasim Industries was up 1.2 per cent at Rs 1,151.30, Tata Steel up around one per cent to Rs 440.60 and Hindalco Industries up 4.8 per cent to Rs 1,333.05.

Cement and metal stocks looked up on hopes that strong demand for the commodities in the peak construction season will drive up prices.

Fast moving consumer goods pivotal Hindustan Lever lost 5.3 per cent to Rs 164.70. Players attribute the fall to fears of a price war after price cuts announced by Procter & Gamble.

A dealer at a local brokerage said, "Bargain hunting at lower levels has helped the markets recover but the mood is still cautious ahead of the big-ticket ONGC float which will hit the market on March 5."

He added that liquidity in the secondary market may not get affected as feared earlier. IPCL was up 10.60 per cent at Rs 202.90 and IBP looked up 0.36 per cent at Rs 665. BHEL was down 1.26 per cent at Rs 591.30, ONGC down 1.16 per cent at Rs 751.55 and HPCL was down 0.45 per cent.