Indian stock market daily morning report

Views on markets today

- Indian markets rose to an almost 1-1/2 week high on Monday, led by gains in software services exporters as valuations were seen more attractive after recent falls and on hopes for more monetary easing in the key U.S. market. Higher European markets also help the markets sentiments amongst the investors. However, volumes were muted ahead of a market holiday on Tuesday, while sentiment remains cautious, given the country's economic and fiscal challenges and uncertainty about recent government proposals regarding foreign taxation. Except consumer durable and pharma, all sectoral indices closed on positive note with IT, oil & gas, real estate and metal stocks were major gainers. Godrej Consumer Products rose 2.50% after the company announced that its consolidated net profit rose 36% to Rs.193Cr on 31% rise in net sales to Rs.1323Cr in Q4 March 2012 over Q4 March 2011. India's biggest real estate developer DLF rose 2.6% after Goldman Sachs upgraded its rating on the stock to "buy" from "neutral", citing optimism about profits on the back of improvements in commercial and residential property. Bhel fell 1.94% on reports Rajasthan state government has scrapped tenders worth Rs.12000Cr that were bagged by the company without specifying any particular reason.

- Maruti Suzuki India declined 1.95% after the company said that its net profit fell 3.03% to Rs.639.84Cr on 18.79% rise in total income to Rs.12023.86Cr in Q4 March 2012 over Q4 March 2011. While adverse currency movements made a significant impact during Q4, the company was able to largely offset it through localization and internal cost control.

- Market breadth was lower at ~1.08x as investors bought large cap stocks. On provisional basis, FIIs bought equity of Rs.4.79bn while domestic institutions sold equity of Rs.2.46bn in cash segment.

- Asian markets mostly up today, though volatile tracking the cues from the US markets overnight. Weak yen helped Japanese markets to stay in positive territory while China's PMI data helped the Hang Seng's sharp rise.

Economic and Corporate Developments

- The European Union said it was expecting that negotiations for a comprehensive free trade pact with India would be completed by year-end though issues like duty concession on wines and automobiles were yet to be resolved.

Buzzing Stocks

- HCC bagged a contract worth Rs.800Cr from the National Highways Authority of India for the sixlaning project of Vadodara-Surat section of NH-8.

- The ongoing campus recruitment at Mysore’s National Institute of Engineering (NIE), if taken as a cue, indicates that IT companies are perhaps beginning to hire again. NIE has recorded an all-time high placement during the recent campus recruitment season 2011-12. The recruitment is likely to reach 100% as it is still in progress.

- Gujarat State Petronet Ltd (GSPL) and three public sector oil companies — Indian Oil Corporation Ltd (IOCL), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) — have entered into joint venture agreements for setting up three cross-country natural gas transmissionpipelines.

- Madhucon Projects Limited (MPL) won a tender for a mine-mouth, coal-fired steam power plant of 300 Mw (2X 150Mw) near its existing coal mine at Dawas village in South Sumatra, Indonesia.

US markets

U.S. stocks advanced Tuesday, propelling the Dow Jones Industrial Average to its highest close since late 2007, after a report indicated U.S. manufacturing expanded in April, offsetting concern about the economic recovery.

The Dow industrials finished at 13,279.32, up 65.69 points, or 0.5%. The S&P 500 climbed 7.91 points, or 0.6%, to 1,405.82. The Nasdaq Composite rose 4.08 points, or 0.1%, to 3,050.44.