Mumbai: The Bombay Stock Exchange benchmark Sensex posted its biggest gain in two weeks on 9 April 2007 as the market wiped out last Monday’s loss in four back-to-back gains. IT stocks led by Infosys Technologies Ltd. and metal stocks were the biggest gainers in today’s rally.
Software exporters notched up gains after the U.S. unemployment rate unexpectedly dropped, easing concern that demand will slow in the world’s largest economy.
“The positive U.S. data bodes well for information technology companies,” said Prateek Agrawal, who oversees $203 million(Rs872 crore) in stocks as head of equities at ABN Amro Asset Management India Ltd. in Mumbai.
Tata Steel led metal stocks higher after the Business Standard said cold-rolled steelmakers may raise product prices next week.
The Bombay Stock Exchange’s Sensex gained 321.66, or 2.5% , to close at 13,177.74. The S&P/CNX Nifty of the National Stock Exchange added 91.50, or 2.4%, and closed at 3843.50.
Infosys, the country’s second-largest software exporter, rose Rs51.7 to Rs2,044. The company reports its fourth-quarter earnings on April 13. Tata Consultancy, India’s largest computer-services provider, added Rs22.75 to close at Rs1,216.6. Wipro gained Rs10.5 to close at Rs561.8. The U.S. accounts for about 60% of sales of Indian software companies.
U.S. unemployment fell to 4.4% last month, the Labor Department said on April 6, matching a five-year low in October.
Tata Steel, the world’s fifth largest steelmaker, gained Rs28.1, or 6% , to Rs493.3. Steel Authority of India Ltd., the country’s largest maker of the alloy, climbed Rs3.6,or 3.1% , to end at Rs118.25. JSW Steel gained 2.4% to end at Rs508.95.
The price of cold-rolled steel, used to make automobiles and refrigerators, may be raised by between Rs4,200 and Rs6,500 a ton, the Business Standard reported, without saying where it got the information. Cold-rolled steel costs Rs32,000 to Rs33,000 a ton, the newspaper said.
Baoshan Steel Ltd., China’s biggest steelmaker, announced a price increase in March for its major products of up to 6.5% for the quarter ending June.
Overseas investors sold a net 22 million rupees worth of Indian shares on April 4, according to the latest information on the Securities & Exchange Board of India’s Web site.
ITC Ltd, India’s biggest cigarette maker, gained Rs7.25, or 4.9% , to climb up to Rs155.35, on expectation that the proposed value-added tax by the states won’t hurt revenue in the year ending March 31 2007.
“ITC is likely to implement a total average selling price increase of 20%, including excise duty hike,” Percy Panthaki and Matt Marsden, analysts at HSBC Securities, wrote in a note to clients on 9 April 2007. “We estimate that this will enable ITC to actually increase FY08 net sales of cigarettes by 1% year-on-year.”