Market cheers Q4 net; Sensex vaults by 513 pts

Mumbai, Apr 21: The 30-share Bombay Stock Exchange (BSE) Sensex jumped by 513.33 points (3.8 per cent) to settle at 13,897.41 in the week ended April 20, its highest closing in almost two months, on the back of firm global markets, reports of a good monsoon this year and strong inflow of funds from Foreign Institutional Investors (FIIs).

Among the broader markets, the NSE S&P CNX Nifty advanced166.20 points (4.2 per cent) to 4,083.55, also a two-month closing high.

Small-cap and mid-cap stocks extended their recovery. The BSE Small-Cap Index advanced 217.91 points (3.2 per cent) to finish at 6,974.37, while the Mid-Cap Index gained 122.58 points (2.1 per cent) to settle at 5,699.08.

Trading for the week began firm, as the Sensex jumped 312 points on Monday. A rally in global markets and forecasts of a good monsoon in India, boosted the bourses. Stock markets of the world hit record peaks on Monday after top policymakers highlighted the strength and improving balance of global economic growth, encouraging already bullish investors to increase their appetite for risk. The G7 leaders said the US economy remained solid despite the weight of a housing slump, while Europe was showing a healthy upswing and Japan's economic recovery was on track.

Fall in IT stocks pulled the Sensex down by 86 points on Tuesday.

IT stocks slipped after the rupee hit its highest level in nine-years.

Firm Asian markets lifted the Sensex by 65 points on Wednesday.

But the barometer index came off the higher level from an intra-day 155.88 point rise to 13,762.92, its highest since February 23 this year.

The market drifted lower on Thursday, reeling under the weakness spread across Asian markets, after latest data showed strong GDP growth in China.

The Sensex ended 52 points lower. Nevertheless, the barometer index staged a solid intra-day rebound from an initial 248.55 points fall. The strong Chinese GDP data sparked fears of a hike in interest rates in China, which, in turn, raised fears of a sharp fall in emerging markets.

The market returned to its winning ways on Friday, as strong guidance for financial year (FY-2008) by IT bigwig Satyam Computer and firm global markets together, propelled the Sensex to a two-month high. The Sensex jumped by nearly 278 points on Friday.

FIIs stepped up buying after Infosys gave a strong guidance for FY 2008 in dollar terms, putting to rest concerns about the impact of a slowdown in the US on India's IT sector. Their net inflow in three trading sessions, between Monday and Wednesday, aggregated Rs 2,076.90 crore. However, foreign funds pulled out a net Rs 73.40 crore on Thursday. Their inflow for April till April 19, totaled Rs 4,371 crore.

Reliance Industries Limited (RIL) struck an all-time peak of Rs 1,545 on Friday. The stock surged during the week after its Chairman Mukesh Ambani said on Monday that the petrochemicals cycle was yet to culminate. RIL said on Wednesday that its board will meet on April 26 to consider Q4 March 2007 and FY-2007 results.

Satyam Computer surged on Friday after it gave a strong guidance for FY-2008. Its net profit rose 38 per cent year-on-year in the March quarter to Rs 394 crore. Just like Infosys, Satyam Computer has given strong earnings and revenue guidance in dollar terms as per US GAAP.

Also, just like Infosys, Satyam Computer has given muted earnings and revenue guidance as per Indian GAAP. The company forecast 27-29 per cent growth in basic earning per ADS, between USD 1.16 and USD 1.18 for the 2008 fiscal. The US GAAP revenue is expected to rise 28 -30 per cent, between USD 1.87 billion and USD 1.9 billion for FY- 2008. As per Indian GAAP, Satyam Computer has forecast between 18-20 per cent growth in earnings per share (EPS) for FY-2008, between Rs 25.32 and Rs 25.73. It has forecast 20-22 per cent growth in revenue as per Indian GAAP for FY-2008.

On the same day, Wipro, too, reported strong Q4 results. It reported 44 per cent year-on-year growth in net profit in the March 2007 quarter to Rs 861 crore as per US GAAP. It also forecast strong growth on more outsourcing and higher billing rates.

Dish TV was listed on the bourses on Wednesday. The stock settled at Rs 102.55 on BSE on the same day. Dish TV has nearly 2 million subscribers and competes with a joint venture between Tata Group and News Corp as well as state-owned Prasar Bharti. Dish TV India, previously known as ASC Enterprises, got demerged from Zee Entertainment Enterprises (ZEEL) with effect from February 12, as part of the Zee Group's restructuring exercise.

Commerce Minister Kamal Nath said on Thursday that all service exports would be exempted from service tax. Announcing the annual supplement of the Foreign Trade Policy, Nath said the export target of USD 125 billion for 2006-07 had been met and the government hoped to achieve USD 160 billion in the current financial year.

India's annual June-September monsoon rains are likely to be 95 per cent of the long-term average, weather office said on Thursday.

The wholesale price index rose 6.09 per cent in the 12 months to 7 Apr 2007, higher than previous week's increase of 5.74 per cent, official data showed on Friday. The annual rate had moderated to below 6 per cent recently after hitting 6.69 per cent on 27 Jan 2007, its highest in more than two years, on the back of Reserve Bank of India (RBI) tightening policy and the government cutting duties on a range of items to rein in prices.

The Reserve Bank of India (RBI) reviews policy next Tuesday. It has raised the reserve requirement for banks three times since December and has raised its main lending rate five times since early June last year to try and curb credit growth and inflation.

The market may remain volatile next week, ahead of the expiry of the April 2007 derivative contracts on Thursday (26 April 2007), market analysts predicted. RIL too will announce it's Q4 results on the same day.

UNI