Mumbai: Sensex settles with small gains

Mumbai, June 25: After breaching the psychological barrier of 14,500, buoyed by strong buying interest in the capital goods sector today, the Bombay Stock Exchange (BSE) Sensex ultimately settled with a modest gain of 20.36 points at 14,487.72, subdued by weak global indices.

It had reached an intra-day high of 14,521.62 and a low of 14,424.71, after opening firmer at 14,469.43 from its previous close of 14,467.36.

''The benchmark index, started firm, but later pared gains, since early afternoon session, tracking weak global markets. All the European indices opened lower, while a majority of Asian markets were trading weak. However fresh buying emerged in late-afternoon session, taking it higher. Information technology (IT) and auto stocks were under selling pressure. Shares from capital goods sector saw buying interest, with the BSE capital goods index striking an all time high,'' market analysts explained.

Led by L&T and BHEL, the BSE capital goods index surged to an all time high of 11,870.62, after settling 1.13 per cent higher at 11,830.08, as per provisional close.

Meanwhile, the broader National Stock Exchange (NSE) Nifty Index also advanced by 7.35 points to settle in the green at 4,259.40 from its previous close of 4,252.05 after moving between 4,264.25 and 4,236.30 in the day's session.

The total turnover on the premier BSE rose to Rs 4,283 crore.

Analysts pointed out that it was over Rs 5,000 crore in the previous three trading sessions.

The market breadth held firm, as buying continued for small and mid-cap stocks. 1,487 shares and 1,116 declined, while 82 remained unchanged. Among the 30-scrip Sensex pack, 15 declined while the other 15 advanced.

''Volatility is likely to be high on the bourses in the short term ahead of expiry of this month's derivatives contracts on Thursday. As is the case at the time of expiry of near-month contracts, the extent of rollover to July 2007 contracts from June 2007 contracts will dictate the trend in the near term. A higher rollover indicates that the market players expect bourses to remain firm in the month ahead and vice versa,'' market pundits pointed out.
The first quaterly (Q1) June 2007 Indian corporate earnings season will kickstart from less than a month from now and over the next few days, traders are likely to build positions based on Q1 results expectations, market analysts predicted and recalled how the strong fourth quaterly (Q4) corporate earnings had helped trigger a solid surge in domestic bourses since early April this year.

Over the next few months, the progress of the July-September monsoon will hold key with regard to the direction the markets take, they said. The weather office had earlier said in April that this year's monsoon was likely to be 95 per cent of the long-term average, with a 5 per cent margin of error. The annual monsoon is vital for India's economic health as it is the main source of water for agriculture, which generates more than a fifth of the gross domestic product, economists observed.

The local currency today opened slightly lower at 40.76/78 per US dollar, from the last sessions close of 40.75/76 per US dollar.

Foreign Institutional Investors (FIIs) were net sellers of approximately Rs 28.23-crore equities during the last trading sessio, while Domestic institutions bought shares worth nearly Rs 512.30 crore.

Today's winners include Larsen&Toubro (L&T), Bharat Heavy Electricals (BHEL), Bharti Airtel, Reliance Communications, Hindalco Industries and Oil&Natural Gas Corporation (ONGC) The laggards included Bajaj Auto, Tata Motors, Maruti Udyog, Satyam Computers, TCS, Infosys Technologies, Wipro and ICICI Bank, while Index heavyweight Reliance Industries (RIL) was unchanged at Rs 1,704 on 5.41 lakh shares.

Most of the Asian markets were trading lower today tracking overnight sharp fall in US stocks during the last trading session.

Hong Kong's Hang Seng was down 0.81 per cent at 21,822.35, South Korea's Seoul Composite slipped by 0.75 per cent at 1,757.73, and Straits Times was down by 0.97 per cent.

Japan's Nikkei 225 average was down 0.56 per cent to 18,087.48.

China's main stock index plunged 3.68 per cent to 3,941.08, hit by worries about government policies to cool the economy and the market and by big losses in oil refining giant Sinopec. On Friday the index had tumbled 3.29 per cent following the Central bank governor Zhou Xiaochuan, speaking in Switzerland at the weekend, said another interest rate hike could not be ruled out because inflation might rise further.

US stocks tumbled last week, wrapping up their worst week since a global sell-off in February amid fears that trouble at two Bear Stearns hedge funds may signal worse problems ahead for credit markets. The Dow Jones industrial average was down 183.31 points, or 1.35 per cent, to 13,362.53. The Standard&Poor's 500 Index was down 19.50 points, or 1.28 per cent, to 1,502.69. The Nasdaq Composite Index was down 28, or 1.07 per cent, to 2,588.96.

Crude oil fell from a nine-month high in New York after a strike in Nigeria ended, easing concern that supplies from Africa's biggest oil producer may be disrupted. Crude oil for August delivery fell as much as 62 cents, or 0.9 per cent, to USD 68.52 a barrel in after-hours electronic trading on the New York Mercantile Exchange.

UNI