Sensex ends above 21000; NTPC at record low, Hindalco up 7%

Moneycontrol Bureau

Equity benchmarks closed at more than a month high on Friday with the Sensex reclaiming the 21000-level for the first time since January 24. The rally, which continued for the fifth consecutive session today, was supported by capital goods, healthcare, banks and Tata group stocks.

It was a strong start to the March series with the Nifty gaining 38.15 points to 6,276.95. The Sensex rose 133.13 points to 21,120.12.

Though the market has seen a swift move from 6,200-6,250 levels, it is still in range that may last for another month, experts believe.

Amit Khurana, Dolat Capital said the broad range has been about 5900 towards 6300-6400 levels.

“Unless we get some clarity on the way the formation for the next government will work out (of course the preference needs to be for the NDA coalition to come back) and unless we get some clarity as to how strong they will be in terms of the numbers seats, I don't think the market will rally very sharply from here onwards. We could probably just flow around this range,” Khurana elaborated.

Consistent inflow of foreign money too helped the market for the second consecutive week. Foreign institutional investors have bought nearly Rs 4,000 crore worth of equity shares in past 10 straight sessions (till February 26).

During the truncated week, the Sensex and Nifty gained 2 percent each in addition to more than 1.6 percent upmove last week.

The month gone by was very strong too; both benchmarks rallied 3 percent each in February.

Hindalco Industries was the star today, rising nearly 7 percent amid hefty volumes followed by TCS and Tata Motors with a 4 percent upmove.

Healthcare and capital goods stocks continued to see buying interest. In fact both sectoral indices topped the buying list, gaining around 5 percent each this week.

Sun Pharma climbed 2.5 percent today and Cipla spiked 2.3 percent.

Dr Reddy's Labs rallied 2.4 percent gain in addition to 2 percent upmove in previous session. The stock closed at new record high of Rs 2,901.55, especially after the company on Wednesday launched Sumatriptan injection USP, Autoinjector system in the US.

Larsen & Toubro soared a percent as its construction division L&T Construction bagged Rs 5,220 crore worth of orders in 2014 so far.

State-run BHEL was up 3 percent and it was the top gainer in the Sensex with more than 11 percent upmove during the week. The rally may be on hopes that the order book may improve in FY15 and analysts have been telling that the next financial year i.e. FY15 will be better for the economy compared to FY14.

India’s largest lenders State Bank of India and ICICI Bank were up 0.7 percent each while Axis Bank surged 2.4 percent. However, HDFC Bank was down over a percent.

ONGC and Oil India spiked 2.7 percent each. Both companies agreed to take 5 percent stake each in Indian Oil Corporation in off-market deal. Divestment secretary Ravi Mathur said the government aims to raise Rs 5,300 crore through stake sale in IOC that ended flat.

However, top car maker Maruti Suzuki lost 4.5 percent as investors were not convinced with clarifications given by the management about the Gujarat Suzuki plant.

CIMB, which maintains reduce rating on the stock with a target price of Rs 1,195 per share, said the second round of clarifications is worrying.

“From an earlier guidance of zero profit for Suzuki, Maruti now says it needs to make a profit to fund future capex. Even if Suzuki pumps in additional equity, costing will only fall marginally. More troubles for minority shareholders are exposed while super rich profitability and return on equity (ROE) are expected for Suzuki,” CIMB report said.

Shares of Reliance Industries (closed below the Rs 800 level), Hindustan Unilever, Tata Steel and Wipro fell over a percent.

Top power generation company NTPC has been under pressure after the CERC’s final regulations for FY15-19. The stock lost 2.5 percent today and closed at a record low of Rs 112.60. It shed 15 percent during the week.

Meanwhile, the rupee today ended at 61.75 per dollar, the highest closing level since January 20, up 23 paise compared to 61.98 a dollar on Wednesday.