Thursday, the Indian market closed higher for the fourth straight session amid strong global cues after better-than-expected economic data in the U.S. fueled hopes of an economic recovery in the world's largest economy.
Additionally, sustained buying by foreign funds in the past few days, hopes of rate cuts following a further retreat in the inflation rate and short covering on account of the expiry of the March series derivatives contracts aided the rally.
The inflation rate dropped to 0.27% in the 12 months to March 14 compared to 0.44% in the previous week, driven by a sharp fall in price of inputs and food articles and on account of high base effect. Significantly, prices of manufactured items showed a modest rise on a week-over-week basis.
The BSE Sensex opened higher at 9,740 and rose to a fresh 2-1/2 month high of 10,061 before finishing at 10,003, up 335 points or 3.47% over the previous close. Similarly, the S&P CNX Nifty rose 98 points or 3.28% to 3,082.
On the BSE, the market breadth was positive, with advancers outnumbering decliners by 1392 to 1138. The broad-based BSE 500 index added 2.76%, but the mid-cap index rose a modest 1.16% and the small-cap index gained a mere 0.69%.
Twenty-seven out of 30 Sensex stocks closed in positive territory, while Ranbaxy Laboratories fell 2.95%, DLF declined 0.31% and ACC moved down 0.28%. Stocks across the sectors ended sharply higher. Stocks of capital goods, power, metal and banking companies led the rally.
Among the major gainers, Tata Motors jumped 7.94%, Larsen & Toubro soared 6.10%, Sterlite Industries surged up 5.97%, TCS climbed 5.94, BHEL advanced 5.85% and Tata Power gained 5.57%.
ONGC, Maruti Suzuki, Wipro, Tata Steel, Bharti Airtel and Reliance Infrastructure also rose around 5% each.
Union Bank of India rose 2.36% after the bank raised additional capital to the extent of Rs.140 crore by issue of subordinated perpetual bonds. Allahabad Bank moved up 1.04% after it closed the sale of perpetual bonds earlier than scheduled after collecting extra bids.
Unitech soared 7.82% after Morgan Stanley Mauritius purchased 96 lakh shares of the realty firm on Wednesday through an open market transaction. Hero Honda Motors rose 1.79% on reports that it expects to sell a record 3.72 million motorcycles and scooters in the current financial year through March.
Nucleus Software Exports rallied 3.24% on bagging a new order for one of its software products. Indian Overseas Bank jumped 6.01% after the biggest domestic institutional investor Life Insurance Corporation of India hiked its stake in the bank.
Sobha Developers gained 2.49% on reports that the company is in discussion with banks, financial institutions and private funds to restructure its debt. Zuari Industries moved up 4.63% after SIL Investments, one of the promoter group companies, revoked 7.50 lakh pledged shares representing 2.55% of the equity capital of the company.
Phoenix Mills climbed 7.46% and Motherson Sumi Systems rallied 4.64% following the execution of block deals on the Bombay Stock Exchange. Tata Tea gained 2.76% after its overseas unit and the European Bank for Reconstructions and Development decided to acquire a 51% stake in a Russian firm Grand.
Akruti City plunged 55% to Rs.819.40 ahead of the removal of the stock from the derivatives segment. In a circular dated 19 March, the National Stock Exchange said that fresh monthly contracts will not be introduced in the stock for expiry month June and all existing future contracts will expire on Thursday. However, the stock will continue to be traded in cash market.
HCL Technologies fell 2.07% despite signing a 3-year contract with M.J. Logistic Services.
Altogether, turnover on the stock exchanges stood above Rs.90, 000 crore for the third consecutive day. Total traded turnover was Rs.97, 107.51 crore. This includes Rs.15, 527.42 crore from NSE cash segment, Rs.76, 957.01 crore from NSE derivative segment and the balance Rs 4,623.08 crore from cash segment on the Bombay Stock Exchange.
Akruti City topped the traded value with a turnover of Rs 545.50 crore followed by Reliance (Rs 370.53 crore), Motherson Sumi (Rs 206.66 crore), ICICI Bank (Rs 163.50 crore) and Reliance Infrastructure (Rs 135.80 crore).
Unitech led the traded volume with trades of around 3.71 crore shares followed by Motherson Sumi (3.43 crore), Cals Refineries (1.75 crore), GVK Power (1.10 crore) and IFCI (95.80 lakh).
On the last date of March series derivatives contracts, marketwide rollover stood at 70% compared to 63% in the previous month.
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