10:30AM The Sensex rises for the sixth consecutive day on banks, cement shares.
The Sensex on BSE advanced 36.52 points, or 0.27%, to end at 13,505.89. The market was highly volatile. The BSE Sensex traded withing a range of 129 points for the day. The market-breadth was positive in early trading but turned negative due to weak small-caps. As 1,537 shares declined on BSE, 1,009 advanced and 62 stocks were unchanged. For every two advancers, there were three decliners. From the Sensex stocks 12 advanced, while the rest declined. The turnover on BSE was Rs 6,110 crore, higher than Rs 5,088 crore on Wednesday. The turnover on NSE was Rs 10,321.46 crore, much higher than Rs 8,768.6 crore on Wednesday.

Economic news

Strong macro economic fundamentals and erasing of the revenue deficit are pre-requisites for moving toward capital account convertibility, former RBI Deputy Governor S. S. Tarapore, who headed the Committee on Fuller Capital Account Convertibility asserted.

Most active stocks

Gujarat Ambuja Cement was the most active stock with a turnover of Rs 716.88 crore. It was followed by Hindustan Zinc and ACC.

Advancers

Gujarat Ambuja Cement was in focus today. The stock rose 1.65% to Rs 139.50, on a cumulative volume of 51.65 lakh shares. The block deals with a turnover of Rs 694 crore, constituted 3.6% (5 crore shares, 2.5 crore shares each) of its equity capital of Rs 272.02 crore (face value Rs 2 per share). It was also the most active stock on BSE, accounting for around 11.75% of the total turnover on BSE.

Another cement large-cap, ACC, surged 5.83% to Rs 1,079. It had also advanced to an all-time high of Rs 1,093.80, intraday.

Private sector HDFC Bank led the advance, up 6.58% to Rs 1,148.25 It had hit a new all-time high of Rs 1,150, in the last moments of trading. India’s largest private sector bank ICICI Bank ended marginally lower by 0.10% to Rs 880.35. SBI jumped 3.21% to Rs 1,216, on a volume of 14.28 lakh shares. It had also surged to an all-time high of Rs 1,227.95.

Other banks also rallied. Punjab National Bank was up 0.27% to Rs 548, Federal Bank gained 4.20% to Rs 223.55, Indian Overseas Bank added 4.36% to Rs 120.80, Oriental Bank of Commerce moved 1.73% higher to Rs 255, Canara Bank edged up 0.89% to Rs 300, and Bank of India gained 2.63% to Rs 191.

Sterlite Industries advanced 0.90% to Rs 542.15, on the back of robust second-quarter results, and a board decision to venture into power sector. The company reported a surge in consolidated net profit for the quarter ended September 2006 to Rs 1,207 crore from Rs 259 crore.

Decliners

IT large-cap Infosys shed 1.27% to Rs 2,195. It has recovered from a low of Rs 2,154. Tata Motors declined 1.51% to Rs 811, amid reports that it has cut Tata 207 LCV price, by Rs 75,000. Cigarette large-cap ITC finished at Rs 185.25, down 0.30% from its previous close of Rs 185.80.

Jet Airways fell 1.6% to Rs 643 even after the US State Department gave security clearance enabling the private carrier to launch flights to America. The airline plans to launch flights between from India via Belgium to New York and plans to fly to Toronto via Hong Kong. In Europe the airline plans to fly to Rome, Zurich and Dusseldorf.


9:45AM Stocks opened higher, led by inflation data and merger deals.
Stocks opened higher on news of tame inflation in October due to falling gas prices and a couple of multibillion-dollar merger deals. The Consumer Price Index fell 0.5%, matching the decline in September, while core inflation index edged up 0.1%, the smallest increase in eight months. More positive news came from another economic report which showed that the number of initial jobless claims fell by 2,000 to 308,000 last week, the smallest reading in a month.

In merger-and-acquisition news, Clear Channel Communications Inc. (CCU: chart), the largest U.S. radio-station owner, agreed to be acquired by an investor group led by private-equity firms Thomas H. Lee Partners and Bain Capital Partners for $18.7 billion in cash. The deal includes about $8 billion in debt. Company’s shares rose 4.5% in early trading. Under terms of the deal, shareholders of Clear Channel will receive $37.60 a share in cash, a 10.2% premium to Clear Channel\''s Wednesday closing price of $34.12. In another merger deal, Reader\''s Digest (RDA: chart) rose 8% after agreeing to be acquired for about $1.61 billion by an investment consortium.

Rate-sensitive housing sector advanced as the inflation data added to optimism that the Fed Reserve is not likely to raise interest rates again. Toll Brothers (TOL: chart) turned in one of the housing sector\''s best performances, with the luxury home builder currently up 4.3%. Hovnanian (HOV: chart) and KB Home (KBH: chart) also moved higher, both up 2.3%. The airline sector posted strength, led by AirTran (AAI: chart) and AMR (AMR: chart), up 2.8% and 2.6% respectively. However, JetBlue (JBLU: chart) helped to limit the upside for the sector, falling 2% after UBS downgraded its rating on the airline to reduce from neutral, citing valuation.

In the first hour of trading, the Dow Jones industrial average was up 23.05, up 0.19%, at 12,274.76. The Standard & Poor\''s 500 index was up 4.41, up 0.32%, at 1,400.98, and the Nasdaq composite index was up 0.76, or 0.03%, at 2,443.51. Bonds rose, with the yield on the benchmark 10-year Treasury note falling to 4.60% from 4.62% late Wednesday.

Industrial production rose 0.2% in October.
The Federal Reserve released its report on industrial production and capacity utilization in the month of October on Thursday. The report showed that industrial production growth came in line with economist estimates. The report showed that industrial production rose 0.2 percent in October after falling 0.6 percent in September. The Federal Reserve noted that production in August was revised up to show a gain of 0.3 percent compared to the previously reported unchanged reading. The increase in industrial production came amid a significant rebound in production in the utilities sector, which rose 4.1 percent after falling 4.6 percent in September. The rebound reflected colder-than-normal conditions following mild temperatures in September. Production in the manufacturing sector edged down 0.2 percent for the second consecutive month, while production in the mining sector rose 0.6 percent in October after rising 0.4 percent in September. The Federal Reserve also said that capacity utilization edged up to 82.2 percent in October from an upwardly revised 82.1 percent in September. Economists had expected capacity utilization to rise to 82.0 percent compared to the 81.9 percent originally reported for the previous month.