Sensex at week’s high; bank, IT shares rise

Sensex at week’s high; bank, IT shares rise
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First Published: Wed, Jan 28 2009. 10 38 PM IST
Updated: Wed, Jan 28 2009. 10 38 PM IST
Mumbai: Share prices rose for a second day on Wednesday, driving the Bombay Stock Exchange’s (BSE) benchmark index to its highest in more than a week, on expectations the US will form a so-called bad bank to absorb toxic assets, helping stimulate the world’s biggest economy.
Tata Consultancy Services Ltd (TCS) gained 2.3%, leading software developers higher, as the Obama administration considers ways to help unlock the US’ credit markets. The US accounts for more than half of the software developers’ revenue.
ICICI Bank Ltd rose 7.1% on speculation the central bank will cut rates to revive slowing economic growth.
”The central bank’s prognosis for growth is very weak; that might force its hand to cut rates,” said Ajay Bodke, who helps manage about $1 billion (about Rs4,900 crore) in equities at IDFC Asset Management Co. Ltd in Mumbai.
The Sensex advanced 253.39 points, or 2.8%, to 9,257.47. The S&P CNX Nifty index on the National Stock Exchange (NSE) rose 78.15 points, or 2.8%, to 2,849.50.
TCS rose 2.3% to Rs507.45. Infosys Technologies Ltd climbed 2.8% to Rs1,286.70. Wipro Ltd added 3.6% to Rs234.10. The share prices are composite of BSE and NSE rates.
The US Federal Deposit Insurance Corp. is seeking to manage the bad bank that the government is considering setting up to help unlock credit markets, according to two people familiar with the matter. The institution would buy the toxic assets clogging banks’ balance sheets.
ICICI added 7.1%, the most since 18 December, to Rs408.05. HDFC Bank Ltd climbed 2.5% to Rs911.75. Housing Development Finance Corp. Ltd gained 4.1%, the most since 5 January, to Rs1,504.55.
Tata Motors Ltd, the maker of Jaguar cars and Land Rover sport utility vehicles, rose 4.5% to Rs146.65, its biggest gain since 1 January, after the UK government said it will offer car makers £2.3 billion (about Rs16,000 crore) of loan guarantees to help them cope with the recession and adapt to new environmental rules.
Glenmark Pharmaceuticals Ltd dropped Rs46.70, or 25%, to Rs141.35, the most on record. The company said profit in the quarter ended 31 December fell 71% to Rs81.43 crore. It also cut its profit and sales forecasts. The stock had its rating cut by JPMorgan Chase and Co. and Citigroup Inc. after the earnings.
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First Published: Wed, Jan 28 2009. 10 38 PM IST
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