Sensex gets adrenaline to flow again

Buying in telecom, cement, banking shares and pharma pivotals triggered a recovery on the bourses in what turned out to be a day of immense volatility. The Sensex’s provisional closing was 13,209.88, a gain of 214.86 points. It also hit an intra-day high of 13,223 at 15:24 IST.

Select side-counter surged and the market-breadth was quite strong. For 1,652 shares rising on BSE, 849 declined. As many as 68 shares were unchanged. Gainers outpaced losers by a ratio of nearly 2:1. The breadth improved substantially in the last half an hour of trade. Earlier, the market-breadth swung between positive and negative throughout the day.

Trading was characterised by extreme volatility today. The Sensex swung over 1,400 points between some vital intra-day tops and bottoms. It swung 392.62 points between the day’s low of 12,830.38 and high of 13,223.

The BSE clocked a turnover of Rs 4,404 crore.

Reliance Communications surged 7% to Rs 432.90, following media reports that it is in talks with three US private equity groups, for buying the Indian operations of Hutchison Telecommunications International in a deal worth more than $14 billion. The stock rose on a heavy volume of 38.6 lakh shares on BSE.

Bharti Airtel surged 4% to Rs 601. As many as 3.2 lakh shares changed hands in the counter on BSE.

Reliance Industries rose 2.6% to Rs 1,240.50. As many as 15.5 lakh shares changed hands in the counter on BSE. Multiple block deals of 1,02,196 shares were executed in the scrip at Rs 1,231.75 a piece, on BSE. The government on Tuesday approved RIL's plan for a $5.2 billion deep-sea gas field, which will pump 80 million cubic metres per day.

Bank shares edged higher after the US Federal Reserve on Tuesday kept US interest rates unchanged. SBI surged 4% to Rs 1,230.90, ICICI Bank 2.7% to Rs 828 and HDFC Bank added 1.9% to Rs 1,050.

Cement shares rose on renewed buying at the lower level. Grasim gained 5.7% to Rs 2,650, ACC rose 3.9% to Rs 1,010 and Gujarat Ambuja Cements advanced 3.9% to Rs 135.

Pharma pivotals firmed up. Dr Reddy’s Lab surged 5% to Rs 792.50 and Ranbaxy rose 2.3% to Rs 368.

Software bellwether Infosys made a solid intra-day rebound in the last half an hour of trade. The stock rose 0.1% to Rs 2,166. Earlier, the scrip had dropped as much as 1.5% to a low of Rs 2,131.30 at 14:50 IST.

Unwinding of long positions in the derivatives accentuated the fall on the bourses, and the Sensex lost 977 points in three trading sessions, between 8 December and 12 December. The market wide-open interest in derivatives declined 6.4% in a single trading session on Tuesday (12 December). Aggressive offloading happened in frontline stocks, where the total open interest declined 9% that day, according to a domestic brokerage.

European shares were in the green in opening trade on Wednesday. Key benchmark indices in London, Germany and France were up by between 0.01% to 0.1%. Asian markets were mixed. Key benchmark indices in Hong Kong, Singapore and Taiwan were down by between 0.1% to 1%. Key benchmark indices in Japan and South Korea were up by 0.3 - 0.4%.

Nymex crude was little changed at about $61 a barrel.