Noon: Markets extend rise to 3% on Asian rally

Noon: Markets extend rise to 3% on Asian rally
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First Published: Wed, May 27 2009. 12 07 PM IST
Updated: Wed, May 27 2009. 12 07 PM IST
Mumbai: Indian shares rose 3% on Wednesday, in step with Asian peers after positive US consumer confidence data fed investor appetite for risk and sparked a rally on Wall Street overnight.
Leading lenders State Bank of India and ICICI Bank, and energy giant Reliance Industries led the main index higher.
Metal producers Sterlite Industries and Hindalco Industries Ltd rose on firmer metal prices.
By 11:41am, the 30-share BSE index was up 3% at 14,000.91 points, with 27 stocks advancing.
The benchmark has gained almost three-quarters of its value from a 2009 low in early March, riding a global rally and fuelled by about $5.5 billion of investments from foreign funds.
The recent decisive victory for the ruling coalition has raised expectations for a stable government that will push more pro-market reforms, boosting the market further.
“Expectations will continue to be built into big stocks till the new government delivers its budget. After that there might be a fall when all the expectations are not met,” Amitabh Chakraborty, head of research at Religare Securities, said.
Government-run State Bank of India, the country’s top lender, rose 5.3% to 1,777, and private-sector ICICI Bank climbed 5.3% to Rs701.75.
Non-ferrous metals producer Sterlite gained 8% to Rs583, while top aluminium producer Hindalco advanced 4.4% to Rs83.40.
Shares of leading telecoms firm Bharti Airtel, which is in merger talks with South Africa’s MTN, erased losses of as much as 2.5% and rose 0.2%.
The stock had fallen more than 10% over the past two sessions on fears the proposed deal will dilute Bharti’s earnings initially.
In the broader market, gainers led losers by more than 5 to 1 on relatively heavy volume of 263.6 million shares. The 50-share NSE index was up 2.7% at 4,226.
An index of US consumer confidence surged in May, strongly topping expectations as it registered the biggest monthly jump since April 2003, according to the Conference Board, an industry group.
Asian markets were higher on the news after an overnight Wall Street rally. Japan’s Nikkei was up 1.4%, while MSCI’s measure of other Asian markets rose 2.2%.
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First Published: Wed, May 27 2009. 12 07 PM IST
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