Markets end 1% up on earning optimism

Markets end 1% up on earning optimism
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First Published: Fri, Apr 09 2010. 05 19 PM IST
Updated: Fri, Apr 09 2010. 05 19 PM IST
Mumbai: Sensex logged their ninth straight weekly gain, their second longest weekly winning streak in nearly a year, to close 1.2% higher on Friday supported by earnings optimism and firm world equities.
The main stock index posted 1.4% weekly rise, its ninth straight weekly gain which was the best run since March-June 2009 when it had risen for 14 consecutive weeks.
The 30-share BSE index closed 1.23% or 218.74 points higher at 17,933.14 points. Twenty-two of its components closed in the green.
“It still looks good to me. Earnings are expected to be good. Fund flow is continuing,” said Manish Sonthalia, fund manager of portfolio management services at brokerage Motilal Oswal.
“There are no new negative surprises on the global front.”
Foreign funds have been consistent buyers of Indian equities since late-February’s national budget which pushed for fiscal consolidation and higher consumption power.
They have bought more than $5 billion of Indian equities so far this year, most of which came in after the budget.
They had pumped in $17.5 billion in 2009, which fuelled a rally and saw the benchmark index gain 81%.
“Valuations look stretched from FY11 perspective, but people are not looking at India from only a one-year perspective. The India story is here to stay,” said Sonthalia.
Financials led the gainers, as investors shrugged off near-term worries on likely monetary tightening to focus on long-term prospects which were supported in a buoyant economy.
Top lender State Bank of India climbed 0.6% while leading private lenders ICICI Bank and HDFC Bank rose 1.8% and 2.6% respectively.
Mortgage lender Housing Development Finance Corp rose 4.4%.
Reliance Industries, which has the highest weight on the Sensex, climbed 1.8% to Rs1,123.95.
Sources said the energy major has found natural gas in four more areas in its field off the country’s east coast.
After market hours, two sources said Reliance Industries plans to invest $1.7 billion for a joint venture with Atlas Energy to develop the US firm’s Marcellus Shale gas operations.
Auto companies gained, as top industry body official expected Indian vehicles sales to reach a record high for the second year in a row in 2010/11, as rising incomes in a rapidly growing economy boosts demand.
Top vehicle maker Tata Motors rose 4.5% while top utility vehicle and tractor maker Mahindra & Mahindra and top motorcycle Hero Honda climbed 2% and 2.2% respectively.
Leading telecoms firms were mixed. India kicked off its first-ever auction of wireless telecoms spectrum on Friday.
Top mobile operator Bharti Airtel declined 1.5% while rival Reliance Communications rose nearly 2%.
Firm base metals prices pushed metals makers such as Sterlite Industries and Hindalco 2.2% and 1.4% higher respectively.
Tata Steel, the world’s eighth-largest steel maker by output, rose 0.8%.
In the broader market, gainers outnumbered losers in a ratio of 1.9:1, while 447 million shares changed hands on the Bombay Stock Exchange, higher than that of Thursday.
The 50-share NSE index closed 1.1% higher at 5,361.75 points.
The MSCI’s measure of world stocks was down 0.4% at 1139 GMT.
The FTSEurofirst 300 index of top European shares gained 1% while the MSCI index for Asian markets other than Japan climbed 0.7%.
Stocks that moved
Top iron ore exporter Sesa Goa fell 4.5% to Rs468.70 after a senior Indian industry official said China’s curb on purchase of low-grade iron ore by traders will hit India’s exports substantially.
Oil explorer Cairn India , a unit of Cairn Energy, rose 1.5% to Rs307.75, as oil prices topped $86 per barrel.
Jewellery maker Shree Ganesh Jewellery House listed at Rs258.85 on the Bombay Stock Exchange, about 0.44% lower than its issue price of Rs260. The stock fell sharply and closed at Rs163.25.
Main top 3 by volume
Shree Ganesh Jewellery on 27.5 million shares
Ballarpur Industries on 25.1 million shares
Spicejet on 8.8 million shares
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First Published: Fri, Apr 09 2010. 05 19 PM IST
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