RTTNews - The Indian market continued its surge on Wednesday, boosted by expectations of a market friendly budget after Prime Minister Manmohan Singh spoke about 8-9 percent growth and promised more spending on infrastructure and public services. Aggressive buying by foreign funds in recent sessions, the rise in the value of rupee for a second straight day and favorable Asian cues also helped improve sentiment.
After meeting chiefs of state-run banks, finance minister Pranab Mukherjee said on Wednesday that banks have agreed to explore the possibility of cutting interest rates further. The impact of stimulus steps might turn around the economy in the near-term and the government would provide a conducive atmosphere for growth by focusing on public spending, he said.
The benchmark for the Indian market, the BSE Sensex opened higher at 15,168 and surged to an almost 12-month high of 15,581 before paring some of its gains to finish at 15,467, up 340 points or 2.25% from its previous close. Likewise, the S&P CNX Nifty rose 104 points or 2.29% to 4,655. The broader market underperformed the large-caps, as profit taking continued in small-caps and mid-caps. Central banks around the world have created an enormous amount of liquidity in the system, which is finding its way into commodities and emerging markets like India, analysts said.
Sector-wise, while power, capital good, consumer durable and banking stocks led the gainers, public sector, IT and auto stocks showed modest gains and realty stocks ended in the red. The market breadth on the BSE was negative. Decliners outnumbered advancers by 1553 to 1218.
Tata Power(up 6.43%), Reliance Infrastructure(up 5.99%), HDFC Bank(up 5.56%), Ranbaxy Laboratories(up 5.44%), ACC(up 5.40%), Reliance Communication(up 5.30%), BHEL(up 4.62%), Larsen & Toubro(up 3.80%) and Mahindra & Mahindra(up 3.41%) were the top gainers.
On the other hand, Tata Motors fell 1.95%, DLF declined 1.71%, Sun Pharma moved down 0.83%, State Bank of India eased 0.37%, HDFC shed 0.23%, Jaiprakash Associates slipped 0.20% and TCS edged down 0.04%.
Banking stocks, with the exception of IDBI Bank, Canara Bank and SBI, closed higher after the finance minister mooted consolidation in the banking space to improve competitiveness of state-run banks.
Unitech edged up 0.28% after it launched its new initiative, branded Uni Homes, with apartment sizes starting at 660 sq. ft. Separately, reports suggest that the company has exited from New Kolkata International Development, a special purpose vehicle to develop large projects in West Bengal. Akruti City rose 2.52% and Indiabulls Real Estate gained 0.37%, but Sobha Developers and Orbit Corporation plunged 5% each, Anant Raj Industries slumped 4.06%, Parsvnath Developers tumbled 3.55% and Ansal Infrastructure fell 3.27%.
Aluminum producer NALCO rose 2.95% on reports that it has prepared a 5-year roadmap for growth. Non-ferrous metals producer Sterlite Industries gained 1.50% on firm copper prices. Nissan Copper closed unchanged after it allotted 23.3 million share warrants on a preferential basis to its founders and independent investors.
Andrew Yule & Co tumbled 4.71% amid reports that it will invest Rs 60 crore in the next two years in its tea, engineering and electrical businesses. State-run company Rural Electrification rose 1.11% on reports that it has sought government approval for raising as much as Rs 30 billion to fund its expansion plans.
Godfrey Phillips was locked at the 10% upper circuit limit on reports that it will soon sell the iconic brand Marlboro in India. Reliance Infrastructure climbed 6% after its shareholders approved a scheme of arrangement between the company and its various wholly owned subsidiaries.
Telecom firm Bharti Airtel rose 2.74% after it entered into a managed services deal with Comviva, a provider of value added services for mobile operators. Tata Teleservices ended down 0.27% after it announced the launch of GSM services in partnership with Japanese telecom services provider NTT DoCoMo. Reliance Communication jumped 5.30% and Idea Cellular ended up 0.24%.
Oil explorer Reliance Industries rose 2.13%, Cairn India rallied 4.82% and ONGC advanced 2.93% after crude oil futures rose over $71 a barrel in Asian trading for the first time in seven months. State-run oil-marketing companies IOC rose 1.05% and BPCL edged up 0.53%, but HPCL ended down 0.67%.
Satyam Computer was locked at the 10% upper circuit limit for the second straight day after the fraud-hit firm disclosed better-than-expected revenue and profit figures for the December quarter, January and February, lifting uncertainty surrounding its true financials. Tech Mahindra jumped 5.46% after it disclosed in a regulatory filing the nature and the extent of funds raised for funding the acquisition of Satyam.
Vishal Information Technologies rose 2.51% and Orient Abrasives climbed 20% after the companies proposed to consider the issue of bonus shares to their shareholders. Solar Industries jumped nearly 19% and Oriental Bank of Commerce gained 1.21% on the back of block deals executed on the stock exchanges.
On the BSE, Tech Mahindra topped the volumes chart with a turnover of Rs 307.14 crore followed by Unitech (Rs 237.43 crore), Suzlon (Rs 212.39 crore), Reliance (Rs 207.31 crore) and Aban Offshore (Rs 203.58 crore).
Unitech topped the volumes chart with trades of 26.10 million followed by Reliance Natural Resources (16.91 million), Suzlon ( 16.86 million), Ispat ( 15 million) and JP Hydropwer (14.64 million).
Elsewhere, the other Asian markets ended with notable gains, the European markets were uniformly higher in early trading and U.S. stocks were set to rally Wednesday morning in New York after the Supreme Court Tuesday allowed the sale of Chrysler LLC's assets to Italian automaker Fiat to move forward.
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