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Markets climb 1.4%; banks, autos up

Markets climb 1.4%; banks, autos up
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First Published: Thu, Jul 08 2010. 10 47 AM IST
Updated: Thu, Jul 08 2010. 10 47 AM IST
Mumbai: Indian shares climbed 1.4% on Thursday on hopes a rally in world markets will bolster global risk appetite and help foreign portfolio investments.
Financials led the rise as investors shrugged off a hawkish stance by the central bank and bet demand for loans would eventually rise in the fast-expanding economy, which is expected grow 8.5% in the fiscal year ending March.
Optimism about the upcoming US earnings season lifted markets in Asia, but traders said they would await European bourses to open for further direction.
By 10:21am, the 30-share BSE index was trading up 1.43% at 17,719.842, with 28 of its components gaining.
“The gains for today may be capped at current levels. We will have to see how Europe fares in the day,” said Ambareesh Baliga, vice-president of Karvy Stock Broking.
Shares in auto firms were trading up after an industry body forecast a 12-13% rise in car sales for 2010/11 after posting a near 31% rise in sales in June.
Truck, bus and car maker Tata Motors rose 1.5% and utility vehicles and tractor maker Mahindra & Mahindra gained 1.4%. Top car maker Maruti Suzuki firmed 0.7%.
Top lender State Bank of India rose 2.35% while rivals ICICI Bank and HDFC Bank gained 2.1% and 1.6% respectively.
A new survey showed the central bank may again raise interest rates at its quarterly policy review at 27 July, after a surprise hike last Friday.
Weekly food and fuel prices data due by 12:00pm, and headline June inflation next week will be watched for cues.
Metal makers rallied as LME base metals gained cheering the rally in global equities.
Non-ferrous metals producer Sterlite Industries climbed 3.1%, while aluminium producer Hindalco was up 1.6%. Tata Steel the world’s eighth-largest producer of the alloy, was up 2.1%.
Bharti Airtel rose 0.7% after the top mobile operator said late on Wednesday it would invest $600 million in Nigeria over the next three years, half within the next 12 months.
In the broader market, gainers were nearly four times the number of losers on volume of 108 million shares.
The 50-share NSE index was up 1.4% at 5,312.60.
Infrastructure Development Finance Co was up 1.9% at Rs182.50 after the Economic Times reported the comapny would raise Rs8.4 billion by selling convertible securities to Malaysian state fund Khazanah and private equity firm Actis.
Oil explorer Cairn India rose 1.5% to 301 rupees as crude oil prices rose to $75 per barrel.
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First Published: Thu, Jul 08 2010. 10 47 AM IST
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