New Delhi: Markets gained by 2.2% after a low inflation data at 2.34% revived buying sentiment. The Bombay Stock Exchange benchmark Sensex was also boosted as industrial production for January shrank only slightly by 0.5%.
The December IIP data was revised to -0.6% from the earlier -2.2% and comparatively the contraction in productivity is almost flat.
The new inflation figure is the lowest since January 2002 and has also raised expectations for rate cuts by Reserve Bank of India.
Sensex had ended negative on Monday as economic worries persisted, but markets rebounded by 2% today on Wall Street rally resuming trade after two-day religious holidays. The 30-share Sensex gained further but retreated from the day’s high dragged by Bharti Airtel shares to close at 8,343.75 or 183.35 points up and 50-share NSE Nifty gained 44.30 points to close at 2,617.45.
Auto segment surged the most with Tata Motors as one of the biggest gainer after investors expressed relief on British government’s decision to grant Jaguar Land Rover £27 million. Tata Motors rose by 6.77% to Rs145.95, Maturi Suzuki gained by 5.83% to Rs688.65 and Mahindra and Mahindra by 3.62% to Rs329.10.
Other segments with active buying were banking, oil and gas, metal, IT and FMCG. ICICI Bank maintained its gaining streak after announcing cuts in interest rate on new loans, it topped on the BSE pack by 8.10% to Rs 284.25.
Sterlite Industries also revived from its losses in the previous session on account of company’s decision to buy a bankrupt US copper miner Asarco for $1.7 billion.
Big companies were also among the big losers today as Bharti Airtel was the top loser down by 4.37% at Rs550.30. Stakeholders reacted impulsively to the news of CEO selling all his company shares in an open market.
The IT index was also higher as Wipro gained 3.09% to Rs212.1075.41, TCS by 2.79% at Rs475.30 and Infosys Technologies by 2.54% to Rs1,227.15.
Satyam Computer Services ended down 3.2% at Rs47.20, as the company closed registrations for potential bidders today beginnning the process to sell 51% stake in the firm
In the global front, European markets opened weak reacting to mixed Asian bourses. Japan’s Nikkei fell 2.4% as broad-based Topix index slid to a 25-year low but Hong Kong’s Hang Seng rose 0.6% as HSBC rallied.