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Sensex rises 0.23%; Tata Steel, HDFC gain

Sensex rises 0.23%; Tata Steel, HDFC gain
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First Published: Tue, Jun 02 2009. 04 31 PM IST
Updated: Tue, Jun 02 2009. 04 31 PM IST
Mumbai: Indian shares eked out a 0.2% rise on Tuesday after spending most of the day in negative territory as resistance emerged after a near 85% rally since early March.
Traders said firm underlying sentiment on signs of a global economic recovery helped bolster the market towards the close.
Private-sector lender HDFC Bank, Reliance Infrastructure dropped after running up sharply over the past 2-“ months.
Tata Steel and non-ferrous metal producer Sterlite Industries climbed on firm metal prices.
Leading lenders State Bank of India and ICICI Bank and top mortgage firm Housing Development Finance Corp also rose on signs of improving global economic health.
The 30-share BSE index ended up 0.23%, or 34.28 points, at 14,874.91, with 14 stocks gaining, after falling as much as 1.6% at one stage.
“It has been a fantastic rally. People who bought shares when the index was at 8,000 points may be coming to sell,” Harendra Kumar, head of research at Centrum Broking, said.
The benchmark is up 54% this year after sliding more than half in 2008.
“Sentiment is still quite good. Whenever shares fall, people see value in stocks. There is a readiness to buy even now,” Kumar said.
A string of positive manufacturing data on Monday from India, China, Europe and the United States showed signs there were green shoots appearing in the global economy, analysts said.
Foreign funds have bought about $6 billion of Indian shares since mid-March as risk appetite picked up and the excess cash in the system is expected to drive inflows.
The Standard & Poor’s 500 Index hit a milestone on Monday, ending above its 200-day moving average for the first time since December 2007, a feat that some analysts took as possibly a harbinger of more gains ahead.
Hopes India’s re-elected ruling coalition will push pro-market reforms such as assets sales in state firms and relax foreign investment rules in insurance and pensions have boosted investor confidence, traders said.
Government-run State Bank of India, the country’s top lender, advanced 1.6% to Rs1,909.50, while rival ICICI Bank gained 1.3% to Rs732.45. Housing Development Finance Corp climbed 4.2% to Rs2,394.95.
Tata Steel jumped 8.2% to Rs474.05 and Sterlite rose 3.9% to Rs690.50.
HDFC Bank eased 2.4% to Rs1,398.45, after soaring 81% since early March. Reliance Infrastructure dropped 4.3% to Rs1,244.45 after nearly tripling in value over the past 2-“ months.
State-run explorer Oil and Natural Gas Corp slid 0.8% to Rs1,167.15 after India’s oil secretary said the government had no plans to sell a stake in the firm.
In the broader section, gainers led losers 1,701 to 1,122 on relatively heavy volume of 894 million shares.
The 50-share NSE index fell 0.1% to 4,525.25.
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First Published: Tue, Jun 02 2009. 04 31 PM IST
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