Markets at a glance

Signs of economic recovery, easing credit situation and positive cues from the international markets helped the Sensex breach the 11,000 mark and close at 11,023 gaining 219.23 points or 2.03 per cent.

The buying in mid and small cap counters helped the respective indices outperform the broader indices with positive gains of 3.4 per cent and 4.88 per cent respectively.

The rally in the market was supported by FIIs, who have been net investors to the tune of Rs 2,956 crore in current month till April 17 (including Rs 1,898 crore in the last week).

What to expect this week

The week ahead could be more volatile partly due to the ongoing elections and the results season. Analysts say that profit-booking may emerge at higher levels given the strong rally in the past few weeks preventing larger gains for the indices.

The Reserves Bank of India's meeting on April 22 to review the interest rates is an important event to watch out for. Inflation reaching historically low levels of 0.18 per cent could result in RBI cutting interest rates further.

Also, the global markets and flow of FII money could determine the trends. On a positive note, the Indian Meteorological Department on April 17 forecasted a near normal monsoon this year.

 

STOCK TO WATCH
ACC
Last week’s close (Rs) 610.00 Prev. week’s close (Rs) 586.85 Week’s high (Rs) 635.45 Week’s low (Rs) 581.40 Last week’s ave. daily turnover (Rs cr) 57.56 Prev. week’s ave. daily turnover (Rs cr) 46.99 Number of up/down move 3/1

ACC will announce its results this week on April 22. The stock could be in the limelight as analysts have predicted a decline in net profit by about 10 per cent for the quarter ended March, with revenue growth estimated at 11 per cent y-o-y.

Analysts attribute this to falling realisations and higher input cost. Its EBITDA margins are expected to be lower by about 50-60 basis points. The sales numbers may be higher given the 6.61 per cent growth in cement dispatches at 5.64 million tonnes for the quarter ended March 2009.

The stock has run up significantly in the recent rally (11 per cent in a month) leading to higher valuations. At current market price the stock discounts its CY09 earnings by 11.5 times.