Sensex gains 131 points; banks, oil & gas up, TCS dips 2%

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Indian equity benchmarks closed the session on a positive note though indices washed out half of their gains in the last one hour of trade due to TCS, BHEL and Bharti. Oil & gas, financial, metal, realty, power and select auto companies' shares held the markets in green.

The 50-share NSE Nifty touched the 5900 level in an intraday trade, before closing at 5,885, with 33 points gain supported by 30 shares out of 50.

According to Prakash Diwan, Head-Institutional Business, Networth Stock Broking, 5,950 is the level that we possibly need to watch a bit more closely. "That should give us an indication whether 6,000 should be taken away easily," he said.

"But there has been some genuine buying that's happening. It's not just a build-up in speculative positions. I guess the mood is kind of setting back for the positive."

Gautam Shah of JM Financial said, "There is a good chance now that the market may pass that resistance zone of 5,900-5,950 which has a lot of technical significance. So, the volatile consolidation might end within next few days." According to him, 5,600 has become a very strong base for Nifty.

Much awaited fourth quarter numbers of TCS - India's largest IT software services exporter - were in-line with the street estimates. The stock lost over 2% after those numbers because in actual, experts were expecting more surprising numbers than the current ones.

TCS reported its fourth quarter net profit at Rs 2402 crore, a growth of 3% from its previous quarter. A CNBC-TV18 poll saw a profit growth at Rs 2,340 crore.

The company attributed its performance in the January-March period, which was in line with street expectations, to excellent execution and constant customer focus. During the period, its revenue jumped by 5.1% to Rs 10,157 crore as against Rs 9,663.4 crore in previous quarter.

Shashi Bhushan, IT Analyst at Prabhudas Lilladher said profit numbers have come below their estimates. "We were expecting further profit but if we see the utilization level, we are expecting the utilization level to dip going forward slightly because after 84% it is very difficult to stretch the utilization levels."

"From here, margin improvement it will take some time. In this quarter they have been able to maintain margin almost flat which is a very good show but beyond this we think that margin will not improve further in next two quarters atleast still they add capacity. So post adding of capacity, there could be some expansion in margins going forward," he said.

The 30-share BSE Sensex gained 131.25 points or 0.67%, to close at 19,602.23. Global markets remained supportive in today's trade as well - US index futures like Dow Jones and Nasdaq gained 0.5-1%. Even European markets were trading 0.5% higher, at the time of closing of Indian equities.

Asian markets ended with 0.7-1.6% gain following rally in US markets yesterday. Earnings season has been playing its part now. But the global markets shrugged off the rise in crude oil prices - London Brent crude jumped to USD 124.5 a barrel from USD 121.5 a barrel yesterday.

For the week, the Sensex and Nifty gained 1% each.

Heavyweight Reliance Industries remained on buyers' radar, with gaining 1.4% ahead of fourth quarter numbers today evening. CNBC-TV18 poll sees 17% growth in Reliance Industries' fourth quarter net profit of Rs 5500 crore. ONGC was the leader, with rising more than 3%.

SBI gained over 2% as the bank stopped teaser home loan scheme. Among other financial stocks, HDFC was up 2.4% and HDFC Bank up 1.6%. ICICI Bank rose 0.5%.

"The banking space, it gives me the confidence that the Nifty will eventually breakout. Bank Nifty has a pending target of about 12,500. If Bank Nifty were to move to those levels which are about 600 points away, Nifty will eventually take out a zone," Gautam Shah said.

Metal Index outperformed other indices, with rising 1.6%. Jindal Steel (ahead of numbers today), Sterlite, Hindalco and Sesa Goa rallied 2-4%. Tata Steel went up 0.9%.

Among others, HUL, Maruti, Hero Honda and DLF were up 2-3%. However, BHEL was the biggest loser on Nifty, with falling more than 4%. Siemens lost 2% and Bharti Airtel declined 1%. SAIL, Tata Motors and Bajaj Auto were down over 0.5%.

All markets will be closed on Friday on Good Friday.

In midcap space, MRF, ING Vysya Bank, Deccan Chronicle, Alok Industries and Apollo Tyres surged 5-10% while Coromandel International, Himadri Chemical, KGN Industries, Alstom Projects and Sunteck Realty fell 3-10%.

In smallcap space, Warren Tea, Dunlop India, JVL Agro, Zenith Infotech and VST were up 8-11%. However, C Mahendra Exports, MSP Steel, Ester Ind, Som Distilleries and Parrys Sugar lost 5-8%.

About 1464 shares advanced as against 1504 shares declined on Bombay Stock Exchange.