Sensex erases gains to end 0.05% down

Sensex erases gains to end 0.05% down
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First Published: Thu, Sep 10 2009. 05 11 PM IST
Updated: Thu, Sep 10 2009. 05 11 PM IST
Mumbai: Bank stocks propelled India’s main stock index up 0.2% on Thursday, but there was investor resistance as the market stretched a winning streak to five successive sessions.
Profit-taking eased early gains of 1.55% and briefly pushed the market into negative territory late afternoon, before pulling back towards the close.
Private-sector lenders ICICI Bank and HDFC Bank rose 3.1% and 0.6% respectively, with investors upbeat after HSBC Securities said in a report it saw more returns in the offing.
Telecoms firm Bharti Airtel rose 1.8% to Rs417.25, after it denied late on Wednesday a media report it had reached an agreement with South Africa’s MTN.
The 30-share BSE index closed up 0.21%, or 33.31 points, at 16,216.86 after rising as high as 16,434.77 - its highest in 15 months. Only 14 of its constituents gained. The 50-share NSE index closed 0.11% higher at 4,819.40.
The benchmark, which more than doubled from its March low on Tuesday, has risen 5.3% over five sessions and is up over 68 percent so far this year.
“Some profit booking was expected after successive sessions of rise,” said Deven Choksey, managing director and CEO at K R Choksey Shares. “The next cues would be the advance tax figures and we are extremely positive on that.”
Companies are set to pay their advance taxes by 15 September and this will provide an insight into expected earnings.
The market has been riding on a global rally in equities over the past few months. World shares rallied to an 11-month high on Thursday, with emerging market stocks moving further beyond pre-Lehman demise levels, on improved risk appetite from investors.
HSBC Securities said its top picks were Canara Bank, HDFC Bank and ICICI Bank, and added they offered potential total returns of 40%, 25% and 25% respectively, as well as the highest expected increase in return of equity in their peer group over the next three years.
The country’s main economic worry was lifting growth rather than inflation, Finance Secretary Ashok Chawla said on Wednesday.
The widely watched wholesale price index fell by a steeper-than-expected 0.12% in the 12 months to 29 August, its 13th successive fall, mainly due to statistical aberration caused by last year’s high energy prices.
But food prices jumped an annual 14.8% by end of August as a poor monsoon hit crops, but analysts said moderate price pressures elsewhere in the economy meant an interest rate rise was unlikely for now.
In the broader market too, losers led gainers in the ratio of 1.6:1 in a relatively good volume of 516 million shares.
“We are seeing a large breakout after we crossed 4,750,” said Neeraj Dewan, director of Quantum Securities. “These are levels to book profits or at best churn portfolios and not commit cash.”
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First Published: Thu, Sep 10 2009. 05 11 PM IST
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