RTTNews - Thursday, the Indian market recouped all its early loss to close near the day's high. While weak global cues and profit taking on concerns about stretched valuations kept trading subdued in early trading, the market recovered substantially in the afternoon after India's President Pratibha Patil revealed encouraging roadmap for the UPA government on economic policy. Reports suggest that railway budget for the year 200-10 would be presented on July 1 followed by the economic survey on July 2 and general budget on July 3.
These (foreign capital) flows, especially foreign direct investment, need to be encouraged through appropriate policy regime, Pratibha Patil said while addressing a joint session of Parliament.
She underlined the need for augmenting resources of the banking and the insurance sectors, emphasized the need for establishing a regulator for the pension sector and unveiled the government's reform plan with respect to disinvestments in state-run units.
The current financial year is expected to see a slowing down of growth on account of the global recession ... Our immediate priority must be to focus on management of the economy that will counter the effect of the global slowdown by a combination of sectoral and macro-level policies, she said. The focus would be on adversely-affected sectors like infrastructure, exports, small and medium enterprises, and housing to restore the growth momentum, she asserted.
Meanwhile, the headline inflation rate for the 12 months to May 23 rose 0.48%, lower than previous week's annual rise of 0.61% and 8.90% in the corresponding week of the previous year, data from the ministry of commerce and industry showed on Thursday.
The BSE Sensex opened lower at 14,755 and fell to a low of 14,599 before bouncing back. Amid sharp gains in realty, capital goods, healthcare, power and public sector stocks, the Sensex hit the day's high of 15,026 before finishing at 15,009, up 138 points or 0.93% from its previous close. Metal stocks bore the brunt of the selling pressure due to weak commodity prices. Consumer durable and IT stocks also ended subdued.
Meanwhile, the S&P CNX Nifty rose 42 points or 0.93% to 4,573, the broad-based BSE 500 index advanced 1.38%, the small-cap index gained 2.20% and the mid-cap index added 2.26%. The market breadth on the BSE was extremely positive. Advancers outnumbered decliners by 2129 to 688 and 56 stocks closed unchanged.
Ranbaxy (up 6.06%), Sun Pharma (up 4.14%), Hindustan Unilever (up 3.73%), Reliance Infrastructure (up 3.39%), Larsen & Toubro (up 3.30%), DLF (up 3.30%), Maruti Suzuki (up 2.79%) and Reliance Communication (up 2.79%) were the top gainers.
Grasim, Jaiprakash Associates, ACC, Tata Motors, Bharti Airtel and ICICI Bank also ended up more than 2% each.
On the other hand, Sterlite slumped 5.91%, Hindalco tumbled 3.54%, Tata Steel fell 3.53%, Wipro declined 1.26%, Infosys shed 1.15%, Mahindra & Mahindra lost 1.11%, Tata Power drifted down 1.08%, ITC edged down 0.27% and ONGC slipped 0.10%.
Kingfisher Airlines rose 1.41% on reports that it is close to receiving a Rs.2, 000 crore loan from a group of banks. However, JetAirways fell 1.90% and SpiceJet ended down 1.52% following reports that the government is in no hurry to push further foreign direct investment in the aviation industry and that there was no bailout package on cards to protect the industry from losses.
Tata Motors gained 2.06% on reports that it bagged a lion's share of bus orders or an estimated 4,689 buses under the Jawaharlal Nehru National Urban Renewal Mission (JNNURM). However, Ashok Leyland closed down 2.89% even as reports said it got an order of 3,200 buses under the scheme.
Suzlon Energy jumped 8.19% on reports that it is set to raise Rs.600 crore from private equity investors to fund the REpower buy from Martifier. DLF advanced 3.30% after it reportedly put its commercial property in Andheri, Mumbai, on the block for around Rs.500 crore.
IVRCL Infrastructure soared 6.93% following reports that it is negotiating a deal with a multinational firm to foray into mining. SAIL shed 1.86% despite reports about improvement in demand for flat steel products.
Satyam Computers rallied 5.83% on reports that it would prepay a Rs.300- crore loan that it had taken from IDBI Bank and Bank of Baroda in February due to improved cash flow situation. Tech Mahindra, which now owns a controlling stake in the fraud-hit firm, also ended up 1.68%.
ICICI Bank rose 2.02% after it slashed its benchmark lending rate by 50 basis points with effect from June 5. Subhash Projects & Marketing was locked at the 5% upper circuit limit on bagging two orders totaling Rs.105 crore from power producer NTPC for construction related works.
Parsvanath Developers was locked at the 5% upper circuit limit on bagging a Rs.20 crore contract from Delhi Metro Rail Corporation for construction of a residential project at Mundka Depot for phase II of Delhi MRTS project.
Opto Circuits ended down a modest 0.08% after the company proposed to raise up to Rs. 400 crore through qualified institutional share placement. Indage Vintners hit the 5% upper circuit limit on repots that Japanese beer maker Asahi Breweries and an Indian entrepreneur are close to buying a major stake in the company.
HCL Technologies edged up 0.52% after its arm HCL GmbH Germany entered into a multi-year pact with The Linde Group, a world-leading gases and engineering company.
Infrastructure stocks such as GVK Power, Jaiprakash, Gammon India and GMR rose more than 2% after the government reiterated its focus on infrastructure development. Among other top gainers, Punj Lloyd rallied 4.69%, Lanco Infratech soared 9.41% and Nagarjuna Construction advanced 5.12%,
Elsewhere, the other major markets across the Asia-Pacific region closed in the red amid concerns about the U.S. economy following weak U.S. private employment and services reports. Additionally, profit taking following recent rally and caution ahead of key U.S. jobs report, coupled with lower commodity prices in international market influenced trading across the region.
The European markets were trading firm in early trading ahead of interest rate decisions from the European Central Bank and U.S. stocks were looking to get back on the winning track Thursday morning in New York. The price of oil rebounded after a big drop in the previous session, rising back above $67 a barrel.
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