×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

Markets close 0.5% up on positive GDP data

Markets close 0.5% up on positive GDP data
Comment E-mail Print Share
First Published: Mon, May 31 2010. 07 29 PM IST
Updated: Mon, May 31 2010. 07 29 PM IST
Mumbai: The BSE Sensex ended 0.5% higher on Monday, bolstered by data that showed the economy grew at its fastest rate in six months in the March quarter, with shares in energy major Reliance Industries leading the gains.
Still, the key stock market index posted its first monthly decline since January, as investors pared their exposure to risky assets in the wake of Europe’s sovereign debt crisis.
Reliance rose 1.1% to Rs1,045.05. A source told Reuters that Reliance’s billionaire owner Mukesh Ambani was in talks to buy a majority stake in JM Financial Asset Management, which oversees $1.8 billion in assets.
The main 30-share BSE index closed up 0.48%, or 81.57 points, at 16,944.63, after falling as much as 0.3% and then rising 0.6% during the day. Nineteen of the index’s components ended in the positive zone. The broader 50-share NSE index ended 0.39% up at 5,086.30 points.
“The economic data has briefly boosted the sentiment, but the overall mood continues to be uncertain on fears that the global economic recovery process may be delayed due to the problems in Europe,” said Arun Kejriwal, a strategist at KRIS.
The market strengthened after data showed gross domestic product grew 8.6% in the fourth quarter of fiscal year 2009/10 from a year earlier, broadly in line with a forecast of 8.7% in a Reuters poll.
“The market is expected to consolidate at this level before moving up as the corporate earnings season is over and there are no positive triggers in the near-term,” Kejriwal said.
Worries about debt pressure in Europe resurfaced after Fitch downgraded Spain’s credit rating and France said keeping its top credit rating may be a stretch without tough budget cuts.
The index fell 3.5% in the month, its first monthly decline since January when it had dropped 6.3%.
The BSE Sensex has, however, fared better than its Asian peers such as China’s Shanghai Composite Index which declined 10% in May and Japan’s Nikkei that lost 11.7% in the month.
Analysts said the market trend in the near-term would be influenced by the June-September monsoon, which is vital for farm output, rural incomes and is a key driver of demand for a wide range of manufactured goods.
Monsoon rains have already hit the country’s southern coast, the chief of the weather office said on Monday.
Most automobile stocks rose on hopes of strong sales in May. The companies will report May sales numbers on Tuesday.
Utility vehicles and tractor maker Mahindra & Mahindra, which has submitted a letter of intent to make a bid for troubled Korean SUV maker Ssangyong Motor, rose 5% to Rs572.45.
Shares in Maruti Suzuki, India’s largest car maker and a unit of Suzuki Motor Corp, closed 1.1% higher at Rs1,236.95.
Oil and Natural Gas Corp rose 3.2% to Rs1,167.20 after the state-run firm posted a 71% rise in quarterly net profit and said it saw hikes in gas prices having a positive impact in the quarters ahead.
In the broader market, 1,661 gainers outpaced 1,170 losers on volume of 329 million shares.
Comment E-mail Print Share
First Published: Mon, May 31 2010. 07 29 PM IST
More Topics: India | Stocks | Markets | BSE | NSE |