Sensex surges 472 points on renewed buying in pivotals

Share prices on Bombay Stock Exchange (BSE) yesterday rallied following healthy rollover of derivative positions from October 2007 to November 2007 on Thursday. Cash market turnover on BSE was just under Rs900 billion.

The market opened marginally higher at 18,823.66 and slipped to low of 18,629.53 during the day. It hit an all-time high of 19,276.45 in late trade. At the day's high of 19,276.45, Sensex had gained 505.56 points for the day.

Its previous all-time high was 19,198.66 struck on October 18, 2007.

The market shrugged off concerns arising from possible FII sales after market regulator Securities and Exchange Board of India (Sebi) put restrictions on issue of participatory notes (PNs) after trading hours on Thursday. The market regulator also directed some exiting PN positions to be wound up within 18 months. It has put in place a set of regulations to clamp down excessive inflows through PN.

The regulator affirmed that sub-accounts would not be allowed to issue PNs and that FIIs will have to unwind PNs with derivatives as underlying in 18 months. Sebi further allowed both regulated and unregulated pension funds, endowments, university funds and charitable trusts to register as FIIs.

PNs are issued by FIIs registered in India to unregistered overseas investors. Registered FIIs buy Indian securities and issue the notes based on the underlying asset.

According to market analysts, the Reserve Bank of India's (RBI) mid-term review of annual policy due on October 30 and US Federal Reserves meeting on October 31 on interest rates, will be key events that will drive the market in the near term.

India's largest engineering and construction company Larsen & Toubro (L&T) galloped 12.40 per cent to Rs3,885. It was the top gainer from Sensex pack.

State Bank of India vaulted 7.53 per cent to Rs2,091. It hit an all-time high of Rs2,104.45. Also, Bharat Heavy Electricals (Bhel) soared 6.35 per cent to Rs2,434.70 in anticipation of robust set of results from the company. It will announce its Q2 results on Monday.

India's largest power generation company by sales, NTPC advanced 2.38 per cent to Rs228.45. As per reports, it is planing to acquire overseas coal blocks with a mining capacity of around 20 million tonnes per annum.

Oil & Natural Gas Corporation (ONGC), the country's largest oil exploration company by net sales advanced 4.12 per cent to Rs1,159.95.

Auto stocks gained on fresh buying. Tata Motors, Mahindra & Mahindra and Maruti Suzuki India were the other gainers from Sensex pack. Also, shares of Bajaj Auto were up marginally by 0.30 per cent to Rs2,503.05. TVS Motor Company jumped 4.32 per cent to Rs56.80.

India's largest private sector entity by market capitalisation and oil refiner Reliance Industries (RIL) rebounded sharply from day's low of Rs2,610 to hit a high of Rs2,710. It settled 2.42 per cent higher at Rs2,691.10 on 1.352 million shares.

World's sixth largest steel maker, Tata Steel pared gains from its 52-week high of Rs1,048.80 struck in early trade yesterday. It ended with 0.62 per cent gain to Rs995.

Among the losers, Bharti Airtel retraced sharply from day's high of Rs1,044.90. It settled with a loss of 2.66 per cent to Rs992.80 on 3.77 lakh shares. It was the top loser from Sensex pack.

ITC slipped from day's high of Rs190.75. It closed 1.40 per cent lower to Rs180.30 despite posting 13.42 per cent rise in Q2 net profits yesterday.