Market snaps 2-day losing streak

Key benchmark indices edged higher in volatile trade as European and Asian stocks rose. The S&P BSE Sensex was up 233.08 points or 1.22%, up close to 170 points from the day's low and off about 30 points from the day's high. The market breadth, indicating the overall health of the market, was positive.

Indian stocks snapped two-day losing streak today, 4 July 2013. From a recent high of 19,577.39 on 1 July 2013, the Sensex had fallen 399.63 points or 2.04% in two trading sessions to settle at 19,177.76 on 3 July 2013. The Sensex has gained 15.03 points or 0.07% in first four trading sessions of July 2013 (till 4 July 2013). The Sensex has declined 15.87 points or 0.08% in calendar 2013 so far (till 4 July 2013). From a 52-week high of 20,443.62 on 20 May 2013, the Sensex has fallen 1,032.78 points or 5.05%. From a 52-week low of 16,598.48 on 26 July 2012, the Sensex has surged 2,812.36 points or 16.94%.

Coming back to today's trade, Reliance Industries gained in volatile trade. FMCG stocks gained on renewed buying. Index heavyweight and cigarette major ITC extended intraday gain in late trade on reports that the company has raised the price of its Gold Flake Regular Filter cigarettes. FMCG giant Hindustan Unilever hit a record high on high volume. IT stocks rose on recent weakness of rupee against the dollar. Shares of pharma major Lupin hit record high, with the stock gaining for third day in a row.

The S&P BSE Sensex was up 233.08 points or 1.22% to 19,410.84, its highest closing level since 2 July 2013. The index gained 267.26 points at the day's high of 19,445.02 in late trade. The index rose 67.25 points at the day's low of 19,245.01 in morning trade.

The CNX Nifty was up 66.05 points or 1.14% to 5,836.95, its highest closing level since 2 July 2013. The index hit a high of 5,848.20 and a low of 5,786.05 in intraday trade.

The BSE Mid-Cap index rose 0.56% and the BSE Small-Cap index gained 0.21%. Both these indices underperformed the Sensex.

The BSE IT index (up 2.73%), BSE FMCG index (up 2.69%), BSE Teck index (up 2.35%), BSE Realty index (up 1.56%), and BSE Consumer Durables index (up 1.23%), outperformed the Sensex. The BSE Metal index (down 0.29%), BSE Capital Goods index (was unchanged), BSE PSU index (up 0.03%), BSE Power index (up 0.24%), BSE Bankex (up 0.29%), BSE Healthcare index (up 0.55%), and BSE Auto index (up 0.67%), BSE Oil & Gas index (up 0.84%), and underperformed the Sensex.

The total turnover on BSE amounted to Rs 1855 crore, lower than Rs 1923 crore on Wednesday, 3 July 2013.

The market breadth, indicating the overall health of the market, was positive. On BSE, 1,249 shares gained and 1,041 shares fell. A total of 140 shares were unchanged.

Among the 30-share Sensex pack, 20 stocks gained and rest of them declined.

Reliance Industries (RIL) rose 1.33% to Rs 861.65. The stock hit a high of Rs 870 and low of Rs 848. The government on 27 June 2013 agreed to double natural gas prices to industrial and retail consumers to help fund investment in exploration and reverse declining domestic gas output. The price of gas could go up to $8.4 per million metric British thermal units (mmBtu), effective 1 April next year, from current $4.2 mmBtu.

Index heavyweight and cigarette major ITC surged 3.74% to Rs 338.50. The stock hit a high of Rs 339.35 and low of Rs 325.95. As per reports, the company has raised the price of its Gold Flake Regular Filter cigarettes from Rs 55 to Rs 58 for a pack of 10 cigarettes.

FMCG stocks gained on renewed buying. Colgate-Palmolive (India) (up 2.71%), Tata Global Beverages (up 1.38%), Marico (up 2.05%), Dabur India (up 1.5%), Nestle India (up 0.72%) and Godrej Consumer Products (up 0.04%), gained.

FMCG giant Hindustan Unilever rose 2.27% to Rs 600.75. The stock hit a record high of Rs 605.20 in intraday trade today, 4 July 2013. The stock rose on high volume of 12.75 lakh shares as against average daily volume of 2.72 lakh shares in the past one quarter.

Anglo-Dutch consumer goods major Unilever's open offer to raise its stake in Indian unit, which opened on 21 June 2013, closes today, 4 July 2013. Unilever will buyback shares from minority shareholders at Rs 600 per share to hike its stake in Hindustan Unilever from 52.48% to up to 75%.

Bata India rose 2.61% to Rs 866.35 after a foreign brokerage initiated coverage on the stock with a buy rating and a target price of Rs 990.

IT stocks rose on recent weakness of rupee against the dollar. Wipro (up 2.13%), Infosys (up 2.29%), TCS (up 3.26%), and HCL Technologies (up 4.1%) edged higher.

A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports. The partially convertible rupee was hovering at 60.14 per dollar, higher than its previous close of 60.215/225. The rupee had slumped to all-time low of 60.76 in intraday deals on 26 June 2013.

Lupin gained 2.38% to Rs 850.70 after striking a record high of Rs 854.30 in intraday trade today, 4 July 2013. The stock had gained 6.97% in prior two trading days.

Tata Motors rose 2.8%. The company on 1 July 2013, said that total sales of Tata commercial and passenger vehicles declined 18.08% to 52,708 units in June 2013 over June 2012. The company's domestic sales of Tata commercial and passenger vehicles declined 16.40% to 48,712 units in June 2013 over June 2012. Exports declined 34.17% to 3,996 units in June 2013 over June 2012.

Maruti Suzuki India fell 0.14% in volatile trade. The company on Tuesday, 2 July 2013, announced the launch of limited edition of sporty version of its compact car model Swift. The Swift RS comes with new styling and graphics, which give it a distinct sporty character and looks, Maruti said. Swift RS will be available only in limited numbers and for a short period.

The company reported 12.6% fall in total sales to 84,455 units in June 2013 over June 2012. The company's domestic sales fell 7.8% to 77,002 units in June 2013 over June 2012. Exports declined 43% to 7,453 units in June 2013 over June 2012. The company announced the monthly sales data on 1 July 2013.

M&M gained 0.37%. The company on Wednesday, 3 July 2013, announced that it has successfully placed a NCD series of 50-year maturity for Rs 500 crore on private placement basis. The NCDs will be unsecured, rated, listed, redeemable at the end of 50th year and will carry a coupon of 9.55% per annum payable annually. This is the first ever INR-denominated NCD issue with a 50-year bullet maturity offered by an Indian corporate. The successful placement of the NCDs is testimony to the unassailable reputation and credit worthiness of M&M, the company said. The proceeds of this issue will be used for capex, long term working capital requirements and refinancing of loans taken for capital expenditure. Credit Rating agencies, CRISIL and ICRA have assigned AA+/stable rating to the issue.

M&M on 1 July 2013, said its domestic tractor sales rose 19% to 26,723 units in June 2013 over June 2012. M&M's total tractor sales rose 17% to 27,749 units in June 2013 over June 2012. Exports declined 19.33% to 1,026 units in June 2013 over June 2012.

M&M's total automobile sales fell 7.81% to 38,092 units in June 2013 over June 2012. Sales of the company's passenger vehicle segment (which includes UVs and Verito) declined 12.93% to 17,232 units in June 2013 over June 2012. The company's domestic sales declined 7.04% to 36,207 units in June 2013 over June 2012. Exports fell 20% to 1,885 units in June 2013 over June 2012.

Ashok Leyland lost 7.69% as the stock turned ex-dividend today, 4 July 2013, for dividend of 60 paise per share for the year ended 31 March 2013 (FY 2013). The company's total sales declined 31.3% to 6,967 units in June 2013 over June 2012. Ashok Leyland's sales of commercial vehicles excluding small commercial vehicle (SCV) Dost declined 36.5% to 4,714 units in June 2013 over June 2012. Sales of SCV Dost fell 17.3% to 2,253 units in June 2013 over June 2012. The company announced the sales numbers on 1 July 2013.

Shares of two wheeler makers dropped. Hero MotoCorp dropped 0.32%. The company reported a 5.95% decline in total sales at 5.02 lakh units in June 2013 over June 2012.

Bajaj Auto slipped 1.02% as the stock turned ex-dividend today, 4 July 2013, for dividend of Rs 45 per share for the year ended 31 March 2013 (FY 2013). The company on Tuesday, 2 July 2013, reported 14% fall in total sales to 2.95 lakh units in June 2013 over June 2012. Motorcycles sales fell 20% to 2.54 lakh units in June 2013 over June 2012. The company said that the illegal strike at Chakan caused a loss of production of 20,000 motorcycles in June 2013. The company's commercial vehicles sales jumped 54% to 41,205 units in June 2013 over June 2012. Exports rose 4% to 1.20 lakh units in June 2013 over June 2012.

Reliance Anil Dhirubhai Ambani (ADA) Group shares surged. Reliance Infrastructure, Reliance Broadcast Network, Reliance Capital, Reliance MediaWorks and Reliance Power gained by between 2.29% to 5.2%.

Reliance Communications rose 2.25% to Rs 134.10. The stock hit 52-week high of Rs 137.30 in intraday trade today, 4 July 2013.

Larsen & Toubro rose 0.73% after the company fixed 13 July 2013 as the record date for 1:2 bonus issue. To commemorate the occasion of the platinum jubilee of the company, L&T's board of directors at its meeting held on 22 May 2013 had recommended issuing bonus shares in the ratio of 1:2 (i.e. one bonus equity share each for every two held).

Bharti Airtel rose 2.38%. The company during market hours today, 4 July 2013, announced that it has subscribed to an additional 2% equity share capital in all the four India Broadband Wireless Access (BWA) entities of Qualcomm AP. With this, all four entities are now subsidiaries of Bharti Airtel. On 24 May 2012, Bharti Airtel and Qualcomm had announced an agreement under which Bharti had acquired 49% interest in Qualcomm AP's India entities that hold BWA licenses in Delhi, Mumbai, Haryana and Kerala.

Bank of India rose 1.88%. The state-run bank said after market hours on Wednesday, 3 July 2013, that it has decided to reduce its base rate from the existing 10.25% per annum to 10% per annum with effect from 8 July 2013.

Kotak Mahindra Bank rose 0.4%. The stock turned ex-dividend today, 4 July 2013, for dividend of 70 paise per share for the year ended 31 March 2013 (FY 2013).

ACC and Ambuja Cements were mixed after reports that Swiss cement major Holcim plans to carry out a substantial restructuring of Indian operations that could include a merger of ACC and Ambuja Cements. ACC was up 2.92%. Ambuja Cements fell 0.24%. As per reports, Holcim has roped in a global investment bank with a mandate of evaluating various options on how the operations of ACC and Ambuja Cements could be combined. Swiss cement maker Holcim holds 50.3% stake in ACC and 50.59% stake in Ambuja Cements (as per the shareholding pattern as on 31 March 2013). However, the reports added the exercise is at a preliminary stage and there is still no certainty about the shape of the eventual outcome.

Sobha Developers rose 1.43% after the company said its new sales rose 10.2% to 0.92 million square feet in Q1 June 2013 over Q1 June 2012. The announcement was made during trading hours today, 4 July 2013.

Sobha Developers said that its sales value surged 25.7% to Rs 602.80 crore in Q1 June 2013 over Q1 June 2012. The average price realization rose 14.1% to Rs 6,548 per square feet (sq. ft) in Q1 June 2013 over Q1 June 2012.

During Q1 June 2013, the company had launched two projects in Bangalore viz. Sobha Landscape, a plotted development project admeasuring 0.20 million sq. ft and a commercial project at St. Mark's Road, Bangalore admeasuring total developable area of 0.35 million sq. ft (super built-up area of 0.20 million sq. ft).

Sobha Developers said the company remains positive about achieving the guidance set for FY 2014, albeit in a challenging economic environment.

MMTC declined by the maximum permissible level of 5% for the day at Rs 83.90, also its 52-week low, with the stock extending recent steep slide triggered by government concluding the divestment of 9.33% stake in the firm at a huge discount to the stock's ruling market price. On 13 June 2013, the Government of India (GoI) sold 9.33% stake in MMTC via Offer for Sale (OFS) through stock exchanges mechanism at an indicative price of Rs 60.86 per share, at a discount of 71.21% to the closing price of the stock of Rs 211.45 on 12 June 2013.

Shares of diamond jewellery maker Gitanjali Gems declined by the maximum permissible level of 5% for the day at Rs 192.75, also its 52-week low. The stock has witnessed a steep slide recently.

ALSTOM India rose 1.36% after the company said it won a contract from state-run Bhel to supply components and services for a super thermal power project in Rajasthan. The announcement was made after market hours on Wednesday, 3 July 2013.

ALSTOM India said it has been awarded a contract by state-run Bharat Heavy Electricals Limited (Bhel) to supply components and services for the 2x660 megawatts (MW) Suratgarh Super Thermal Power Project (STPP), located in Suratgarh, Rajasthan, India. This contract is worth approximately 27 million euros ($35 million).

Out of the entire aforesaid contract, the company's scope of work mainly comprises of supply of partial pressure parts for one of the units, few control & instrumental valves and other site services. The value of company's scope of work would be Rs 101.74 crore (15.04 million euros), ALSTOM India said in a statement.

Mangalore Chemicals and Fertilizers fell 2.31% after Deepak Fertilisers & Petrochemicals Corporation acquired 2.89 crore shares, or 24.46% stake, in the company on Wednesday, 3 July 2013.

Deepak Fertilisers & Petrochemicals Corporation (DFPCL) made the announcement after market hours on Wednesday, 3 July 2013. Shares of DFPCL rose 1.38%.

DFPCL acquired a 24.46% stake in Mangalore Chemicals and Fertilizers (MCFL) for Rs 179 crore, becoming MCFL's largest shareholder. DFPCL, through its wholly-owned subsidiary SCM Soilfert, acquired 2.89 crore shares in MCFL at an average price of Rs 61.75 per share through multiple block deals executed on the BSE on Wednesday, 3 July 2013.

DFPCL said that given its considerable strengths in the fertiliser business, the investment is very strategic and a good fit with the company's business. DFPCL said it looks forward to working closely with MCFL to enhance long-term value for the shareholders of both companies. As on 31 March 2013, Vijay Mallya's UB Group held 22% in MCFL.

Meanwhile, the government on Wednesday finally cleared an ambitious Rs 1.25 lakh crore food security plan, promising subsidized food to two out of every three Indians. The move is expected to help the Congress party gain significant political support in the run-up to the 2014 general election, although it may stretch the government's fiscal deficit.

European stocks advanced on Thursday, halting a two-day decline, as investors awaited interest-rate decisions from the European Central Bank and the Bank of England. Key benchmark indices in France, Germany and UK were up 0.65% to 1.16%.

The European Central Bank (ECB) is widely expected to keep its main refinancing rate unchanged at 0.5% after a monetary policy review today, 4 July 2013, with the spotlight set to fall on ECB President Mario Draghi's press conference following the meeting. The Bank of England is also expected to leave its lending rate unchanged at a record low 0.5% after a monetary policy review today, 4 July 2013.

Asian stocks were mostly higher on Thursday, 4 July 2013, after positive US jobs data spurred gains on Wall Street overnight. Key benchmark indices in Hong Kong, Indonesia, South Korea, China and Singapore were up 0.1% to 1.6%. Key benchmark indices in Japan and Taiwan were down 0.22% to 0.26%.

The US stock market remains closed today, 4 July 2013, for Independence Day holiday. US stocks edged higher on Wednesday as positive jobs data countered international concerns in the abbreviated trading session.

The US government will unveil the influential nonfarm payrolls data for June 2013 on Friday, 5 July 2013.

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