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Markets edge up; SBI down, Power Grid gains

Markets edge up; SBI down, Power Grid gains
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First Published: Tue, Nov 09 2010. 04 45 PM IST
Updated: Tue, Nov 09 2010. 04 45 PM IST
Mumbai: Indian shares edged up 0.4% on choppy Tuesday propped up by firm European equities, despite State Bank of India posting its biggest single-day loss in nine months a day after the top lender’s quarterly earnings missed forecasts.
European shares edged up early on Tuesday, with several companies rising after upbeat statements, and a supportive macroeconomic backdrop helping sentiment.
State Bank of India shed 4.4% after it announced late Monday flat quarterly profit on higher provisioning and said it would make similar set-asides in coming quarters to meet new guidelines.
“SBI is improving its operating performance, but is struggling with asset quality, in our view,” JP Morgan said in a note, adding it was “neutral” on SBI and preferred ICICI Bank. ICICI Bank closed 1.1% higher at Rs1,269.45.
The 30-share BSE index gained 0.38% or 80.10 points to 20,932.48, with two-thirds of its components closing in the green. The 50-share NSE index gained 0.5% to 6,301.55 points.
“Volatile trade is expected as people tend to book profits when market nears new highs. But, a big decline from here is ruled out,” said Rakesh Rawal, head of private wealth management at Anand Rathi. “(Quarterly) Results so far were positive on an overall basis. There is nothing big to worry on that front.”
Net foreign fund investments in Indian equities have totalled $28.1 billion so far in 2010, pushing the main stock index up nearly 20%.
It is only around 275 points away from a new all-time high.
Power Grid Corp jumped 5.5% to Rs103.75 as Citigroup upgraded the stock to “buy” from “hold” while Macquarie upgraded the stock to “neutral” from “underperform”.
The state-run transmission utility’s $1.7 billion share sale opened Tuesday.
“It is a good issue to subscribe at the given price band. It is attractively priced,” said Rawal, citing the 85 rupees to 90 rupees a share price band.
Outsourcers bounced back, with the sector index rising 1.1% after shedding 1.5% on Monday.
Leading software firms Tata Consultancy Services, Infosys Technologies, and Wipro firmed between 0.1% and 2.3%.
Vehicle maker Tata Motors and aluminium producer Hindalco gained 0.2% and 0.6% respectively, ahead of their September-quarter earnings announcements expected after the market’s close.
Top mobile operator Bharti Airtel, which will announce its July-September earnings early on Wednesday, closed 1.7% higher.
Advancing shares led declining ones in a ratio of 1.4:1 in the broader market, in heavy volume of 556 million shares.
At 3:52pm, the FTSEurofirst 300 rose 0.6% while the MSCI’s measure of Asian markets other than Japan shed 0.2%.
STOCKS
Coal India extended losses and dropped 1.3% to Rs326.05, after a sparkling debut last week.
The stock, which had risen more than 40% over its issue price last week, has shed more than 6% this week.
Thermax shed 1.7% to Rs875.20, as the energy equipment maker said it has acquired European boiler manufacturer Danstoker A/S and its German unit Omnical Kessel for 29.5 million euros.
Oberoi Realty shed 0.6% at Rs288.60, after the real estate firm said late Monday its net profit for July-September dipped 36%.
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First Published: Tue, Nov 09 2010. 04 45 PM IST
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