Driven by FIIs, results hopes

STOCKS REPORT

Helped by foreign fund buying, the benchmark BSE Sensex closed at a new high on Monday at 6679.20, up by 76.51 points.

Expectations of improved corporate results during the third quarter also served as a driver for the improved buying.

Market opened at 6626.49 and touched an intra-day high of 6684.77. 6629.49 was the low for the day. The broader Nifty index closed up 34.50 points at 2115.

Dealers said that corporate earnings for the third quarter are expected to be the main drivers for fresh inflows into India.

Gainers outpaced losers by about four to one in heavy trade of 36. 6 crore shares. Volumes on the exchanges also improved with shares worth Rs 2,300 crore being traded on the BSE and shares worth Rs 5,246.08 crore being traded on the NSE.

Improved buying is expected in metal and cement stocks, while paper stocks could benefit from an imminent price hike. During 2004, FII inflows were to the tune of $8.5 billion, the highest ever. During the same period the index rose 13 per cent.

Automobile stocks rallied on soaring December shipments, while metal shares climbed on news of price increases by top companies.

Hero Honda Motors raced 5.1 per cent to Rs 600.40 after the company said that its December shipments jumped by 44 percent from a year ago to 230,751 units.

Bajaj Auto gained 1.01 per cent to close at Rs 1,142.85 after its December motorcycle shipments doubled from the previous year's figures.

Maruti Udyog rose 1.8 per cent to close at Rs 469.40 after its December vehicle sales climbed 18 per cent from a year earlier.

Aluminium stocks firmed after the top two domestic producers raised prices by 2 per cent, or Rs 2,000 per tonne, from Jan 1.

Shares in the state-run National Aluminium Company rose 2.3 per cent to Rs 205.65, while industry leader Hindalco Industries climbed 1.1 per cent to close at Rs 1,442.85. Both were trading near to their new record highs.

Reliance group shares were firmer even after a squabble within the controlling family took another turn as Anil Ambani resigned as vice-chairman of a group company, Indian Petrochemicals Corp.

Reliance Industries gained 1.7 per cent to Rs 543.10 and IPCL jumped 5.2 per cent to close at Rs 191.70.

Reliance Energy also closed up 7.14 per cent to Rs 561.85 with fresh buying interest on reports that a foreign fund was interested in picking up a stake in the electricity generation facilities of the company.

Tata Power closed up 1.88 per cent at Rs 397.90, NTPC was up 1.60 per cent at Rs 88.75, Power Trading Corporation closed up 7.69 per cent at Rs 58.85, among others.

Power sector is expected to face exciting times with a whole lot of investments lined up in the sector from domestic players.

The reforms in the power sector are expected to get a new thrust.

Additional power generation capacity of 107,000 MW has been planned over the next few years by the government.