Closes the week on positive note

Krishnan Thiagarajan

THE privatisation initiatives of the Government leading to a surge in select PSU stocks, the strong rally in cement stocks and the positive signals emanating from the UTI Bank - Global Trust Bank for other private/ public sector banks were the key events which dictated the market movements during the course of the week.

Fuelled by these developments, the broadbased BL -250 Index closed for the week on a positive note at 1302.89 points, appreciating by 2.1 per cent.

Most of these pointers were also available from the sectoral indices movements during the week. Among the key gainers during the week were PSU Index, Core Sector Index and Banking Index which appreciated by 7.6 per cent, 6.3 per cent and 4.5 per cent. The other sectoral gainers were Bellwether Index and GDR / ADR Index which moved up by 3.9 per cent respectively.

From the composition of the PSU Index, it is obvious that the 7 per cent disinvestment in VSNL, strong earnings performance and a joint venture among telecom PSU's was the trigger for the PSU Index. The movement has to be seen in the backdrop of the possibility of the Telecom PSU's namely Bharat Sanchar Nigam (the erstwhile Department of Telecom Services), Mahanagar Telephone Nigam (MTNL) and Videsh Sanchar Nigam (VSNL) forming a tripartite agreement to offer value added communication services. The major gainers during the week from the PSU Index were VSNL, MTNL and Hindustan Petroleum Corporation (HPCL).

Secondly, the core sector index was triggered by the sharp run-up in the stockprice of cement stocks which enjoy a significant weightage in the index. Aided by good earnings performance, the key cement stocks namely, ACC, Gujarat Ambuja Cements, Grasim and Madras Cements have marched up during the week.

Finally, the merger announced between UTI Bank and Global Trust Bank in the swap ratio of 9 shares of the former for 4 shares in the latter has sparked off a strong rally in a few private / public sector banks. This has helped in firm trends in the Global Trust Bank which appreciated by Rs 13.95 to close at Rs 99.35. The other gainers were SBI and Vysya Bank.

Among the industrial indices, the major gainers during the week were Power - 12.0 per cent, Petroleum - Refining and Distribution - 9.9 per cent, Telecommunications - Services - 9.7 per cent, Cement - 9.3 per cent and Petroleum - Refining - 7.8 per cent and Petroleum - Exploration - 7 per cent. The other major losers were Shipping - 6.2 per cent, Chemicals- Inorganic and Speciality - 3.6 per cent, Metals - Non ferrous - 3.6 per cent and Steel - Flat Products - 3.3 per cent.

Among the big gainers in individuals stocks in BL -250 are Atlas Copco - 22.9 per cent, Kesoram Industries - 20.1 per cent, Birla Corp - 18.5 per cent, Century Textiles - 17.7 per cent, Mastek - 17.1 per cent, MTNL - 16.4 per cent, Global Trust Bank -16.3 per cent. The major losers were IP Rings - 17.1 per cent, Jindal Strips - 16.6 per cent and EID Parry - 14.9 per cent, GE Shipping - 13.2 per cent and NIIT - 10.8 per cent.