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

Metals lead Sensex to best close in 22 months

Metals lead Sensex to best close in 22 months
Comment E-mail Print Share
First Published: Tue, Jan 05 2010. 05 21 PM IST
Updated: Tue, Jan 05 2010. 05 21 PM IST
Mumbai: The BSE Sensex climbed 0.7% on Tuesday to its highest close in 22 months, propelled by metals in anticipation of robust December output data and stronger prices as a recovering economy boosts demand.
Sentiment was also helped after a top economic adviser said there was no need to raise interest rates for now, and the Reserve Bank could drain excess cash to moderate inflation expectations.
Leading aluminium maker Hindalco Industries added 7.4% to Rs175.20. Rival state-run National Aluminium Co Ltd jumped 14.8% to Rs505.20.
“The outlook for metals stocks is good. Base metal prices are showing a firm trend. December quarter results are likely to be better due to the base effect,” said Pawan Burde, vice-president of research at PINC Research.
“Also, JSW Steel production numbers have raised hopes that others may follow suit,” he said.
JSW Steel Ltd, India’s No. 3 producer of the alloy, said its crude steel output jumped 88% to 1.47 million tonnes in the three months to December.
Some small steel makers also raised prices, boosting sentiment.
Non-ferrous metals producer Sterlite Industries rose 4.6% while Tata Steel, the world’s eighth-largest steel maker by output, climbed 2.4%.
The 30-share BSE index rose for the third straight session and closed up 0.73%, or 127.51 points, at 17,686.34, its best close since 28 February, 2008. The 50-share NSE index rose 0.9% to 5,277.90.
Twenty-three of its components advanced.
“The mood is positive on the back of positive data like auto sales numbers for December and PMI data. Also, firm base metal prices are helping,” said K. K. Mital, head of portfolio management services at Globe Capital.
”Right now, there is nothing so negative that can hurt the market,” he added.
Foreign funds pumped $17.5 billion into Indian equities in 2009, powering the main index up 81%, its best yearly gain since 1991.
ICICI Bank rose nearly 1% and mortgage lender Housing Development Finance Corp gained 0.3% after C. Rangarajan, the prime minister’s economic adviser, said an adjustment in policy interest rates was not warranted for now.
Engineering and construction firm Jaiprakash Associates, which also has interests in power, rose 5.8% to Rs162.70 as its December cement shipments leapt 60% to 1.06 million tonnes.
“Jaiprakash is benefitting from good delivery at its cement business. Capacity expansion along with signs of firm demand trend is helping,” said Daljeet Kohli, head of research for private client group at Emkay Global.
Bharti Airtel gained 1.6% to 330.10 rupees after Bangladesh’s telecoms authority approved its initial investment of $300 million in Bangladesh mobile company Warid Telecom.
Energy major Reliance Industries extended its decline, losing 0.5% to 1,069.55 rupees.
The stock had shed 1.3% on Monday as the firm sold some shares raising $577 million to aid its buy of bankrupt petrochemicals firm LyondellBasell (LBI).
“While we do not see much in terms of cost synergies for RIL from the deal, we believe it would likely give RIL access to LBI’s leading distribution network in Europe/U.S. and presence in the Middle East through LBI’s upcoming low-cost capacity,” Goldman Sachs said in a note.
In the broader market, gainers led losers in a ratio of 1.6:1 on heavy volume of 704 million shares.
Comment E-mail Print Share
First Published: Tue, Jan 05 2010. 05 21 PM IST
More Topics: India | Stocks | Markets | NSE | BSE |