Monday, 31st March, 2008

BOMBAY STOCK MARKET : ClosingDownward spiral...
The broader markets had a difficult time in checking the downward spiral as the large caps tumbled 4% as against around 1% in the mid cap and small cap space. Heavyweights from the software and banking sectors bore the brunt of the selling activity. As regards global markets, while the Asian indices closed in the red, the European indices are witnessing a negative trend currently.
The BSE Sensex closed at 15,644 (down 727 points) while the NSE Nifty closed at 4,735 (down 208 points). The rupee was trading at 39.98 to the dollar.
The markets began on a disappointing note on the back of inflation worries. But the worst was yet to come as the indices continued to tumble as the day progressed. Infact, the Sensex recorded its day's low towards the very end of the trading session. Both the BSE midcap index as well as the BSE smallcap index closed lower by 1%. The overall market breadth was negative with losers outnumbering the gainers by a ratio of 8:1 on the broader BSE. HDFC and Wipro (down 9% each) led the pack of losers.
L&T has won a Rs 5.8 bn turnkey project from HPCL for the construction of a 200,000 tonnes per annum lube oil base stock plant. This would enable HPCL to produce high quality Group II & III lube oils, which are higher value-added petroleum products. It intends to set up this plant as a part of its quality upgradation project. The scope of work includes residual process design, detailed engineering, procurement, supply, transportation, storage, fabrication, inspection, construction, installation, testing, mechanical completion, pre-commissioning, commissioning and performance guarantee test runs. It may be noted that L&T's engineering and construction order backlog stood at Rs 476 bn at the end of December 2007, which is 3.5 times segment sales in FY07. L&T ended lower by 4%, while BHEL closed lower by 3%.
Power Grid Corporation, the central transmission utility, has signed a loan agreement with the Asian Development Bank (ADB) for US$ 600 m, having a 25 year term. The loan will be drawn in two tranches, of which the first tranche will be of US$ 400 m. The loan will be utilised to finance the high voltage North Eastern-Northern / Western region interconnector lines, as well as the substations for the transmission capacity from Uttarakhand. It may be noted that the company has a long association with ADB and has already availed three loans amounting to US$ 925 m for its various transmission projects. Power Grid ended lower by 2%, while Tata Power closed 3% lower.

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