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Markets close up 1.4% at their highest in a year

Markets close up 1.4% at their highest in a year
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First Published: Mon, Apr 05 2010. 05 08 PM IST
Updated: Mon, Apr 05 2010. 05 08 PM IST
Mumbai: Indian shares on Monday ended up 1.4% at their highest close since February 2008, propelled by gains in their Asian peers. Energy major Reliance Industries and financials topped the gainers.
The 30-share BSE index closed 1.37%, or 243.06 points, higher at 17,935.68 points, its best close since 19 February, 2008. Twenty three of its components advanced. The 50-share NSE index gained 1.5% to 5,368.40 points.
Earlier in the session, the benchmark hit a high of 17,948.54 points - its highest since February 2008.
“The news flow has been positive both globally and on the domestic front,” said R. Ganesh, director of Systematix Shares.
Firm Asian equities underpinned the market after a three-day weekend, as data showed U.S. employers created jobs last month at the fastest pace in three years, leading to hopes of a sustained economic recovery.
Foreign funds have invested around $4.4 billion in Indian stocks so far this year, of which most of the inflows came in March.
Indian auto makers rose on the back of robust sales in March.
Leading motorbike maker Hero Honda raced 4.4% after March sales climbed 17% from a year earlier, while top vehicles maker Tata Motors rose 0.6% on a 38% jump in March sales.
“Earnings optimism seems to be contained in the price. Any disappointment there, could lead to a correction,” Ganesh said.
Top listed firm Reliance Industries, which has the highest weight on the Sensex, gained 2.9% to Rs1,125.15.
Nomura upgraded the stock to “buy” from “neutral” and said it expects Reliance’s earnings to grow 44% in fiscal 2011, driven by refining and exploration and production (E&P).
“With concerns mostly abating, the focus, in our view, should now shift to large earnings growth (on a very large base) and on significant potential E&P upside,” Nomura said in a note.
Financials rallied as investors ignored near-term inflation woes and focused on long-term prospects in a growing economy.
Top lender State Bank of India climbed 1.6% and leading private lenders ICICI Bank and HDFC Bank rose 2.3% and 0.2% respectively.
Top mobile operator Bharti Airtel rose 4.5% to Rs315.60, as it caught up with gains in the broader market after underperforming in 2009 and year to date.
Bharti, which was one of the worst performers amongst Sensex constituents in 2009, is down 4% so far in the year, including Monday’s gains, when the benchmark has gained 2.7%.
Software companies that get most of their revenue from exports, did not participate in the rally, as the rupee rose to a 19-month high leading to worries it could hit their margins.
Top outsourcer Tata Consultancy Services shed 0.6% while Wipro closed barely changed. IT bellwether Infosys Technologies erased early losses and closed nearly 0.1% higher.
Last week, median forecasts from 35 foreign exchange strategists showed the partially convertible rupee strengthening to 43.53 against the dollar by March 2011, due to surging flows of funds.
Foreign funds have invested around $4.4 billion in Indian stocks so far this year, of which most of the inflows came in March.
In the broader market, more than three shares advanced for every share that declined. Around 481 million shares changed hands on the BSE, better than that in the previous session.
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First Published: Mon, Apr 05 2010. 05 08 PM IST
More Topics: India | Stocks | Markets | BSE | NSE |