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Rally in global markets boost Indian equities, Sensex rises 496 points

MUMBAI - Markets shrugged-off yesterday's RBI rate hike move and rallied to higher levels today led by fresh buying in financial, metal and realty stocks. Rally in global equities and sustained drop in oil prices aided a rebound on the domestic bourses.

The market benchmark, the 30-share BSE Sensitive Index (Sensex) breached 14,000 mark in early trade, gained more than 525 points at the day's highs hit in late trade, and remained firm throughout the day.

US stocks surged overnight, benefiting from a steep drop in oil prices and an unexpected rise in US consumer confidence after Merrill Lynch's announcement of yet another write-down and capital-raising exercise, raising hopes that the turning point in the year-long credit crisis was close. Asian and European markets were trading higher today. New York's main contract, light sweet crude for September 2008 delivery slumped $2.54 to $122.19 a barrel on the New York Mercantile Exchange yesterday.

Banking stocks bounced back from yesterday's steep fall. Metal, IT and realty and power shares also gained. Except BSE FMCG index all the other sectoral indices on BSE gained. HDFC, Tata Steel rallied more than 7.5 per cent while Tata Power and Reliance Infrastructure surged more than close to 7 per cent each. The market breadth was strong as buying was witnessed across the board.

Despite a 550-point fall yesterday, the Sensex opened with a positive gap of 215 points at 14,007 on the back of positive cues from the global markets. The Sensex rallied to a high of 14,323, and finally settled with a gain of 496 points at 14,287. The NSE Nifty moved up 124 points to settle at 4,314. Nifty July-end futures were at 4330, at a premium of 16.45 points as compared to spot closing of 4313.55.

The BSE clocked a turnover of Rs53.54 billion from Rs51.03 billion Tuesday. NSE's futures & options segment turnover was Rs585.44 billion from Rs648.04 billion Tuesday. July derivatives contracts will expire tomorrow.

The market breadth was fairly positive - out of 2,724 stocks traded, 1,784 advanced, 857 declined and the rest were unchanged. In the 30-member list of Sensex shares, 28 advanced and 2 declined.

HDFC and Tata Steel soared 8 per cent each to Rs2,274 and Rs630, respectively. Tata Power and Reliance Infrastructure zoomed 7 per cent each to Rs1,115 and Rs971, respectively. HDFC Bank rallied over 6 per cent to Rs1,093. Sterlite, SBI, Tata Motors, Wipro and BHEL surged around 5 per cent each to Rs622, Rs1,387, Rs416, Rs422 and Rs1,669, respectively. ICICI Bank advanced 4.5 per cent to Rs635. Infosys, Bharti Airtel, DLF and ACC gained 4 per cent each at Rs1,603, Rs810, Rs491 and Rs591, respectively. Ranbaxy, TCS, Reliance and Maruti moved up 3.7 per cent each to Rs493, Rs839, Rs2,163 and Rs589, respectively. Grasm added 3.5 per cent to Rs1,852. Satyam spurted over 3 per cent to Rs380. Mahindra & Mahindra, Reliance Communications and Jaiprakash Associates are up around 2.5 per cent each at Rs513, Rs502 and Rs157, respectively. Larsen & Toubro was up 1.7 per cent at Rs2,589. Of the 2 lone losers of the day, NTPC plunged over 4 per cent to Rs171, and ITC was down 1 per cent at Rs188.

Corporate news scenario: Tata Motors rallied 4.91 per cent to Rs416.30. The company today reported 30.13 per cent fall in net profit to Rs3.26 billion on a 17.88 per cent rise in total income to Rs72.44 billion in Q1 June 2008 over Q1 June 2007. Mahindra & Mahindra looked up 2.66 per cent to Rs513.50. The companyís net profit fell 16.66 per cent to Rs1.59 billion on a 25.99 per cent rise in total income to Rs33.32 billion in Q1 June 2008 over Q1 June 2007. The company's board approved acquisition of all the business assets of Kinetic Motor Company (KMCL), a two-wheeler company for Rs1.1 billion. Power generation major NTPC shed 4.23 per cent to Rs170.90. NTPC reported 27.1 per cent fall in net to Rs17.27 billion on a 5.87 per cent growth in total income to Rs102.57 billion in Q1 June 2008 over Q1 June 2007. Hero Honda Motor gained 6.27 per cent to Rs782.30. The company reported 44 per cent surge in profit after tax to Rs2.73 billion on a 16 per cent growth in turnover to Rs28.9 billion.

Reliance Natural Resources topped the value chart with a turnover of Rs3.75 billion followed by Reliance Capital (Rs2.34 bn), Larsen & Toubro (Rs1.78 bn), Reliance Inds (Rs1.67 bn) and HDFC (Rs1.46 bn). Birla Cotsyn led the volume chart with trades of around 52 million shares followed by Reliance Natural Resources (39 mn), IFCI (9.5 mn), Ispat Industries (9.2 mn) and Reliance Petroleum (8.3 mn shares).

The BSE Mid-Cap index was rose 1.68 per cent to 5,581.01 and the BSE Small-Cap index was up 1.41 per cent to 6,927.08. Both these indices underperformed Sensex. BSE Bankex (up 5.21 per cent to 6,522.62), BSE Realty index (up 5.09 per cent to 5,041.88), BSE Metal index (up 4.69 per cent to 12,698.70), BSE IT index (up 3.72 per cent to 3,722.09) outperformed Sensex.

Bank stocks recovered from Tuesday's steep fall. HDFC Bank (up 6.18 per cent to Rs1,092.50), ICICI Bank (up 4.59 per cent to Rs635.30) and State Bank of India (up 4.97 per cent to Rs1,386.65) were prominent gainers.

Realty stocks surged. Indiabulls Real Estate (up 13.48 per cent to Rs299.65), DLF (up 3.98 per cent to Rs490.70) and Unitech (up 3.41 per cent to Rs162.15) soared.

Metal stocks rallied. Tata Steel (up 7.83 per cent to Rs630.05), Steel Authority of India (up 3.58 per cent to Rs136.05), Hindalco Industries (up 0.65 per cent to Rs140.15) and Sterlite Industries (up 5.13 per cent to Rs622.45) were prominent gainers.

IT stocks gained. Satyam (up 3.12 per cent to Rs380.20), Wipro (up 4.9 per cent to Rs422.45), Infosys (up 4.07 per cent to Rs1,602.60) and TCS (up 3.76 per cent to Rs838.60) saw handsome gains.

Power stocks surged. Tata Power (up 6.92 per cent to Rs1,115.50), Reliance Infrastructure (up 6.9 per cent to Rs970.80), and Reliance Power (up 5.77 per cent to Rs163.05) were top gainers.