Indian share prices closed up 1% on Friday on bargain-hunting as funds and investors bought benchmark stocks after sharp declines earlier in the week, dealers said.
They said local markets will continue to track global equity trends, amid concerns that overseas funds may exit emerging markets over US credit woes.
The Mumbai stock exchange benchmark 30-share Sensex index closed up 152.7 points at 15,138.4 after gaining 49.93 points on Thursday. The markets plunged 3.96 percent, their second sharpest fall for the year, on Wednesday.
Gainers led losers 1,538 to 1,002 on lower volume of Rs39.81 billion ($986 million).
The rupee gained against the dollar to 40.36 from 40.43 while it fell against the euro to 55.31 from 55.26.
Overseas funds this week led the sell-off sparked by heavy losses on Wall Street after further problems in the US home loan market while Indian banks were hurt by a rise Tuesday in their cash reserve requirement aimed at stemming credit growth.
Markets traded within a narrow range post mid-day. The overall market breadth was positive with gainers outnumbering losers in the ratio of 4 to 1 on the Nifty. Software stocks were witnessing selling pressure.
The BSE Sensex was trading up 198 points, at 15,184 (up 198 points) while the NSE Nifty is trading at 4,411, up 55 points.
Energy stocks are currently trading firm with Reliance Petro, Petronet LNG and RNRL leading the pack of gainers (each up 2%). As per a leading business daily, the seventh round of ’New Exploration and Licensing Policy’ (NELP VII) is likely to be delayed till October-November this year due to shortage of drilling units across the world.
According to the DGH (Directorate General of Hydrocarbon), the situation is pertaining to the shortage of rigs is likely to improve in a year and a half and hence it is makes much more sense to delay the auction.
Tracking the firm global trend, the Bombay Stock Exchange Index, Sensex, continued its recovery move by rising another 225 points at open on sustained buying by foreign and domestic funds.
The Sensex, which had recovered 50 points in yesterday’s (2 August) trading, spurted by 224.56 points at 15210.26 in first five minutes on trading. The key index had plummeted nearly 4% on 1 August.
Similarly, the wide base National Stock Exchange Index Nifty jumped by 65.50 points at 4421.85 points as heavy-weight stocks like ACC, Reliance Communications, BHEL, Larsen & Toubro and Infosys gained 2 per cent each. As the buying gathered momentum, all the sectoral indices lead by capital goods and realty rose smartly.