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An Eventful Week

The week ended November 5, 2004, was a busy seven days for the stock markets, with events including Bush re-election as US president, NTPC listing, VSNL acquiring Tyco, good results declared by cement companies and finally the oil price hike setting the trend for the future.

The week ended November 5, 2004, was a busy seven days for the stock markets, with events including Bush re-election as US president, NTPC listing, VSNL acquiring Tyco, good results declared by cement companies and finally the oil price hike setting the trend for the future. While the BSE Sensex gained 3.86 per cent to end the week at 5891.36, Nifty added 3.66 per cent to 1852.30.

The gain was extended to the broader markets with the S&P CNX 500 rising by 4.03 per cent and CNX Mid Cap 200 gaining 4.17 per cent. The markets also touched their six-month closing high this week.

VSNL set the ball rolling with a $130 million acquisition of Tyco. The news was well received in the market with the stock climbing 7.36 per cent on Tuesday. Good automobile numbers were also declared in the week. On the news of a 34 per cent rise in its motorcycle sales, Bajaj Auto stocks added 2.26 per cent on Tuesday.

Markets, particularly the technology stocks, celebrated Bush re-election as the president of the United States. The BSE IT Index gained 2.68 per cent on Wednesday, as compared to its previous close on Tuesday.

The government finally increased the oil prices on Thursday. Diesel prices were hiked by Rs 2.12 to Rs 2.53, while petrol prices went up by Rs 2.19 to Rs 2.37. This fueled the oil stocks with HPCL gaining 7.2 per cent on Friday to Rs 342.

NTPC stock also got listed on Friday at Rs 88 on the NSE, 41.94 per cent above its issue price of Rs 62. The stock closed at Rs 75.55 on both exchanges, a gain of 21.85 per cent over its issue price. The NTPC listing had a positive impact on some power companies, with CESC rising 10.18 per cent, Neyveli Lignite rising 2.10 per cent. Reliance Energy also added 1.36 per cent.

Cement majors also came out with some strong numbers. ACC`s dispatches for the month of October grew 13.80 per cent to 1.402 million tonnes. Grasim's cement production has moved up by 8.39 per cent to 11.42 lakh metric tonnes. For Ultra Tech, the cement dispatches have grown 8.77 per cent to 10.70 metric tonnes. Gujarat Ambuja's dispatch figures increased by 27 per cent to 12.93 metric tonnes.

Outlook
The markets seem to have broken out in the positive direction after staying at the same level for two weeks. The numbers declared by the cement and the automobile companies have been strong. With Kerry loosing the tight battle to Bush, companies in the anti-outsourcing backlash are expected to reduce. Stock specific movement may continue.