The prime index of the Bombay Stock Exchange (BSE), the Sensex, surged 2.19 percent, Tuesday, to its highest close in two weeks, as positive Q4 results announced by IT bellwether Infosys Technologies boosted market sentiments.
The 30-share benchmark sensitivity index rose 346.02 points to 16,153.66, with 25 components ending in the green, to its highest close since March 28. The index touched a high of 16,249.46 and a low of 15,573.03 during intraday trade.
The index, which hit a record high of 21,206.77 on Jan. 10., is still down more than 20 percent this year.
The Sensex surge was led by IT stocks Tata Consultancy Services (TCS), Infosys Technologies, Wipro and Satyam Computer Services which advanced 7.37 percent, 6.21 percent, 4.52 percent and 4.35 percent to Rs.975.10, Rs.1510.80, Rs.424.65 and Rs.452.05 respectively.
Ranbaxy Laboratories posted an impressive gain of 8.62 percent to Rs.481.80. The stock rose on news that the firm had reached a settlement with Anglo-Swedish drugmaker AstraZeneca and will produce a generic version of AstraZeneca's patented ulcer drug Nexium from May 27, 2014.
Telecom majors Reliance Communications and Bharti Airtel rose 5.38 percent and 1.55 percent to Rs.519.80 and Rs.816.65 respectively.
FMCG majors Hindustan Unilever (HUL) and ITC climbed 4.36 percent and 1.86 percent to Rs.245.40 and Rs.207.95 respectively.
Power majors NTPC and Reliance Energy zoomed 2.65 percent and 1.51 percent to Rs.191.45 and Rs.1300.55 respectively.
Auto majors Maruti Suzuki and Tata Motors surged 2.08 percent and 0.56 percent to Rs.754.45 and Rs.625.50 respectively.
India's second largest bank ICICI Bank, top listed firm Reliance Industries (RIL) and engineering and construction major Larsen & Toubro (L&T) gained 2.34 percent, 2.30 percent and 1.18 percent to Rs.806.90, Rs.2608.80 and Rs.2806.75 respectively. The three stocks contribute to almost a third of the weight of the index.
Other stocks that posted respectable gains were DLF (up 3.23 percent to Rs.617.30), ONGC (up 2.45 percent to Rs.1024.80), Cipla (up 2.24 percent to Rs.219) and Jaiprakash Associates (up 2.22 percent to Rs.218.80).
The stocks to end the day in the red were Hindalco (down 1.59 percent to Rs.173.55), HDFC Bank (down 0.95 percent to Rs.1315.25), Ambuja Cements (down 0.89 percent to Rs.116.55), Housing Development Finance Corporation (down 0.28 percent to Rs.2374.60) and ACC (down 0.24 percent to Rs.810.65).
Among the sectoral indices, all the counters ended in the positive zone, with IT (up 5.55 percent), TECk (up 4.08 percent), Healthcare (up 3.32 percent), Consumer Durables (up 2.78 percent), Oil & Gas (up 2.77 percent) and PSU (up 2.32 percent) leading the pack.
The BSE Midcap and Smallcap indices posted positive growth, ending up 1.24 percent and 1.52 percent at 6604.42 and 8204.39 respectively.
The BSE market was overall positive as 1784 shares advanced, 875 shares declined and 50 shares remained unchanged.
The broader 50-share S&P CNX Nifty index of the National Stock Exchange (NSE) was up 2.13 percent at 4,879.65, its highest close since March 28. The index touched the day's high of 4,917.10 and a low of 4,708.30 points as the market turned volatile at mid-way.
According to market analysts, trading sentiments were boosted by Infosys' announcement that it expects sales to rise 21 percent to record levels in the year ending March 2009.
On Tuesday, Infosys Technologies reported revenue of Rs.16,692 crore ($4.17 billion) for the fiscal year ended March 31 this year, a 35 percent increase over revenue in the previous year. For the full year, the company's consolidated profit after tax (PAT) touched Rs.4,659 crore compared with Rs.3,856 crore, a year-on-year (YoY) growth of 20.8 percent. And, for the fourth quarter ended March 31, 2008, its PAT rose 9.2 percent to Rs.1249 crore ($312.25 million), from Rs.1145 crore ($286.25 million) last year, lower than the Rs.1260 crore ($315 million) forecast by analysts. The revenue and profit growth is lower than in the last fiscal year, when the company's revenue grew by 44 percent, and profits by 53 percent. The company, however, forecast higher-than-expected revenue of 19.2-21.1 percent and said it expected earnings per share (EPS) to rise by up to 18.3 percent in the fiscal year that began in April 2008. The company also recommended a final dividend of Rs.7.25 per share (145 percent on an equity share par value Rs.5) and a special dividend of Rs.20 per share (400 percent on an equity share par value Rs.5). The results declared by Infosys have raised hopes that the economic slowdown in the United States would have a limited impact on the Indian IT sector and also allowed investors to look forward to a robust earning season.
People have found some comfort in software firms after Infosys results, keeping in view worries over a U.S. slowdown, said Dipak Acharya, a fund manager with BoB Mutual Fund in Mumbai.
If next two three results are okay, we may see the market bouncing towards 16,800 levels, Acharya said.
We saw some bottom-fishing last week also. Domestic institutions have extended their support, he added.
Elsewhere in South Asia, Pakistan's Karachi 100 gained 0.65 percent to a record close of 15,538.45, and Sri Lanka's Colombo All-share added 0.42 percent to 2,625.61. Bangladesh's Dhaka Stock Exchange climbed 0.74 percent to 3098.24.
In Asia, the market outlook was positive with Japan's Nikkei 225 climbing 0.57 percent to 12,990.58 and Hong Kong's Hang Seng rising 0.38 percent to 23,901.33.
China's Shanghai Composite surged 1.57 percent to 3348.35; Taiwan's Taiex gained 0.36 percent to 8924.78; Indonesia's Jakarta Composite advanced 0.96 percent to 2294.26; Singapore's Straits Times soared 0.44 percent to 3056.49; and Malaysia's Kuala Lumpur Composite climbed 0.87 percent to 1244.20.
South Korea's Kospi, however, ended down 0.26 percent at 1742.17.