Bombay Stock Exchange (BSE) Sensex, gained 28.3 percent in May 2009, its strongest monthly performance in 17 years, boosted by positive economic data and hopes for market-friendly reforms.

Energy giant Reliance Industries and state-run explorer Oil and Natural Gas Corp led the surge after the oil minister said a proposal to allow firms set retail fuel prices based on market rates would be sent to cabinet within six weeks.

The 30-share BSE index rose 329.24 points to 14,625.25, with 26 stocks advancing. It was the highest close since last Sept. 10 as it rose 5.3 percent on the week, extending a winning streak to 12 weeks in a row - the best run in four years.

Its monthly rise was behind only Russia’s RTS stocks index among major indices of the world.

The benchmark has soared 82 percent from a 2009 low in early March, and is up 52 percent this year after slumping by more than half in 2008. The rebound has been powered by more than $5.5 billion ploughed in by foreign funds over the past 2-½ months.

Investor confidence got a boost after the ruling coalition was re-elected with more seats in parliament, raising hopes for economic reforms such as reviving asset sales in state companies and opening up sectors like insurance.

A second-stage boost can come from execution of reforms. Any quick aggressive policy response will mean upside to our forecasts..

Engineering conglomerate Larsen & Toubro   and Reliance Infrastructure were among the biggest gainers in May as investors bet they would benefit as the government increases spending to improve creaking infrastructure.

The realty sector raced up 79 percent in May, helped by a jump of three-quarters in shares of top developer DLF Ltd.

Even though there are concerns the market may have become expensive, analysts said the mix of a stable government, the prospect of reforms such as divestments, signs of green shoots in the economy and improving corporate results will continue to attract investments from cash-flush funds.

Reliance Industries, which has the most weight in the main index, gained 2.6 percent on Friday to 2,277.50 rupees, nearly doubling its market value since early March.

L&T rose 4.8 percent to 1,405.60 rupees, a day after it reported better-than-expected results and forecast robust orders. The stock advanced 60 percent on the month, while rival Reliance Infrastructure rocketed up 84 percent.

The banking sector, which includes top lender State Bank of India and private-sector rival ICICI Bank, put on 45.3 percent in May on expectations of loan growth and reduced risk of defaults.

Top telecoms firm Bharti Airtel climbed 3.1 percent to 819.65 rupees, raising for a second day after falling more than 10 percent over three sessions following news of its merger talks with South Africa’s MTN.

In the broader market, gainers led losers by more than 3 to 1 on relatively heavy volume of 688.3 million shares.

The 50-share NSE index rose 2.6 percent to 4,448.95, taking its gains for the month to 28 percent.

Top 3 stocks traded (By Volume)

- Unitech on 32.2 million shares.

- Suzlon Energy on 25.1 million shares.

- Reliance Natural Resources on 21.2 million shares .

FII and DII activity that was seen on Friday, May 29, 2009 is shown below. The report shows that FII were net buyer of Rs 272.77 crore where as DII saw buying of Rs 873 crore.

India’s GDP for fourth quarter has been declared. India’s economy grew a faster than expected 5.8 percent in the March quarter from a year earlier.

The annual growth for India’s fiscal fourth quarter was above the expectations, but sharply lower than the year-ago quarter’s 8.6 percent expansion.

The manufacturing sector contracted 1.4 percent in the January-March quarter from a year earlier, while farm output grew an annual 2.7 percent, government data showed on Friday.

For the full year, India’s GDP came out to be 6.7 percent in 2008/09, sharply slower than the 9.0 or more in the previous three years. The FY09 GDP projection was 7.1%

Farm sector growth has been revised to 1.6% vs 2.6% earlier.

Yesterday: As we predicted, Indian Stock Market went up as it holds level of 14000 but profit booking came at higher level and sensex closed up by 180 points.

Today: We expect flat positive opening and it would be very interesting to see whether nifty would break it’s major resistance at around 4377-4380. If it breaks it decisively than we may see a level of 4400-4450 on the Nifty.

Note: Stocks to trade for intraday, short-term delivery, long term delivery, short selling and Futures and when to exit those stocks would be sent to paid subscribers live during the market hours through SMS.

BSE Sensex: (14296) The support for the sensex is 14000 n resistance on the up move is 14500.          

NSE Nifty: (4337) the support for the Nifty is at 4280 and the resistance to the up move is at 4380

Today’s Result:

Arvind, Lanco Infra, Tata Motors, Voltas, Indian Oil, IVRCL Infra, BOI, Colgate

India’s Inflation rose 0.61 percent for the week ended on May 16, matching the previous week’s annual rise, government data showed on Thursday.

The annual inflation rate was 8.66 per cent during the corresponding week of the previous year.

The wholesale price index is more closely watched than the consumer price index, which is published monthly, because it covers a higher number of products and is released weekly.

Mahindra and Mahindra, India’s top utility vehicles and tractor maker, on Thursday beat expectations with near-doubling in quarterly net profit.

Company’s Q4 net profits rose by about 89% as compared to last year Q4 net profits.

Mahindra, which aims to enter the US market with a pick-up truck and sport utility vehicle early next year, announced that its net profit rose to Rs 418 crore in the fiscal fourth quarter ended March from Rs 221 crore a year ago.

Net sales rose to Rs 3619 crore from Rs 3148 crore.

GMR Infrastructure Ltd reported on Thursday its consortium has won a build-operate-transfer contract for the Hyderabad-Vijayawada highway.

The 181-kilometre highway project includes constructing, operating and maintaining the four-six laning of the section in Andhra Pradesh for 25 years.

Mr. Anand Sharma is appointed as the new trade minister for India, a key post responsible for negotiating the country’s stand in the Doha round of global trade talks.

Mr. Sharma was the junior foreign minister in the previous government.

A government statement late on Thursday said Murli Deora had been reappointed as oil minister, while Kamal Nath, who was the trade minister in the previous government, would be the new minister for road transport and highways.

INSTANEX: At close, the Instanex FII Index was up 1.55% at 306.33 (+1.77% at 3 pm) and the Instanex DII 15 portfolio was up 1.46% (+1.70% at 3 pm). Nifty was up 1.43% (+1.44% at 3 pm) and Sensex was up 1.32% (+1.60% at 3 pm). The other Instanex Ownership Indices were also up – the Instanex Promoter 15 portfolio was up 2.38% (+2.47% at 3 pm), the Instanex Top 15 portfolio was up 2.20% (+2.38% at 3 pm) and the Instanex Retail 15 portfolio was up 1.28% (+1.58% at 3 pm).  

All the 15 components of the Instanex FII Index 11 are up and four are down. The main gainers are Bharti Airtel (+3.42%; weight 11.48%), NTPC (+2.80%; weight 2.41%),ICICI Bank (+2.71%; weight 10.28%) and the main losers are Infosys (-0.56%; weight 10.30%) and HUL (-0.11%; weight 2.58%). 

Instanex FII Index at close on Thursday, May 28, 2009 

FII and DII activity that was seen on Thursday, May 28, 2009 is shown below. The report shows that FII were net buyer of Rs 1859.59 crore where as DII saw selling of Rs 451.25 crore.

Yesterday: Indian Stock Market opened with a bull gap and crossed 14000 mark. Sensex traded above that level so we may see more up trend today.

Today: Indian market is expected to open flat or with positive trend. Some profit booking may come at higher level but next logical target for the sensex is 14480 unless we stuck with some dreadful bad news.

BSE Sensex(14110) The support for the sensex is 13990 n the resistance on the up move is 14500. 

NSE Nifty (4276) the support for the nifty is 4250 n resistance on the up move is 4300-4350.

Today’s result: 

L&T, M&M, SAIL, GMDC, TATA POWER, TATA Chem

FII and DII activity that was seen on Wednesday, May 27, 2009 is shown below. The report shows that FII were net buyer of Rs 369.8 crore where as DII saw buying of Rs 685.64 crore.

Yesterday: as we said, one should go long only when market hold 14000 mark. Market was not able to hold that level and corrected sharply from level of 13992 mainly due to profit booking ahead of F&O expiry.  

Today: We are expecting positive gap up opening due to positive global cues but still we would like to stick to our point that go long only if market holds above 14000 mark.

Note: Stocks to trade for intraday, short-term delivery, long term delivery, short selling and Futures and when to exit those stocks would be sent to paid subscribers live during the market hours through SMS.

BSE Sensex: (13589) The support for the Sensex is 13400-13200 and the resistance to the up move is at 13800-14000

NSE Nifty: (4117) the support for the Nifty is at 4090 and the resistance to the up move is at 4200

Today’s Result:

Jindal Steel, Cairn, NIIT, BHEL, Britannia, Godrej Ind, Indra Gas

Bharat Heavy Electricals Limited (BHEL) has bagged an order of Rs 703 crore for the main plant package at the upcoming 270 Mega Watt (MW) Bela Thermal Power Project in Maharashtra.

According to a BHEL spokesperson at Hardwar, “Valued at Rs.703 crore, the order for the Greenfield power project, located at Bela in Nagpur district, has been placed on BHEL by Ideal Energy Projects Limited (IEPL) reflecting the customer’s confidence in the company’s technological excellence and project execution capabilities.”

This order comes close on the heels of another order for a 600 MW thermal power plant of Korba West Power Company Limited in Chhattisgarh.

The spokesperson added that significantly, major private sector customers have been reposing confidence in BHEL and in fiscal 2008-09 itself, orders worth over Rs.1,30,00 crore were placed on the company by Jindal Power, Jaiprakash Power Ventures, GVK Power, Hindalco,  HPCL, Mittal Energy Ltd., Adani Power, Tatas and ACC, among others.

The government is ready to deliver further fiscal stimulus to detain the economic slowdown, the finance minister Mr. Pranab Mukherjee said on Tuesday, but added that fiscal prudence was also a priority.

Pranab Mukherjee said that stimulus steps taken since late 2008, including cuts in duties and extra spending, were having its impact which has given some amount to economic growth and the government would take further measures to revive activity, although some sectors such as textiles and real estate were badly hit.

“What is needed right now is the stimulus to the growth. But at the same time, we cannot lose our sight, that we cannot indulge in fiscal profligacy,” Mukherjee said.