Market recovers on firm global stocks

The domestic markets showed no sign of weakness today gaining consistently almost throughout the day on firm global equities. The BSE Sensex provisionally climbed 7.58%. Finance minister P Chidambaram's statement that the government was working on more measures to infuse liquidity in the banking system and increase the confidence of depositors and investors, aided the rebound in equities.

World stocks jumped from last week's four-year low after policymakers around the world took new and drastic steps to rescue banks and prevent the global economy from sinking into recession. The UK government injected 37 billion pounds ($63.95 billion) buying into leading UK banks while Australia and New Zealand guaranteed all bank deposits.

Trading in US index futures suggested the Dow would rise 327 points at the opening bell.

BSE's banking sector index Bankex was the major gainer among the sectoral indices on BSE, with ICICI Bank surging close to 17%. Reliance Communications jumped 19.92%, Reliance Infrastrucutre rose 17.13% and Sterlite Industries vaulted 15.99%. Shares of L&T and Bharat Heavy Electricals which make equipment for nuclear power plants, rose after India and US on Friday, 10 October 2008, signed the civilian nuclear deal.

Though the market breadth was strong as buying was witnessed across the board, the small-cap and mid-cap indices underperformed the Sensex.

As per the provisional figures, BSE 30-share Sensex was up 808.81 points or 7.58% to 11,336.66. The Sensex surged 833.47 points at day’s high of 11,361.32, in mid-afternoon trade. The index rose 289.83 points at the day's low of 10,817.68 at the onset of the trading session.

The S&P CNX Nifty was up 225.75 points or 6.88% to 3,505.70 as per the provisional figures.

The BSE clocked a turnover of Rs 3,852 crore today as compared to a turnover of Rs 5,107.30 crore on Friday, 10 October 2008.

The BSE Mid-Cap index was up 4.39% at 3,837.44 and the BSE Small-Cap index was up 3.77% at 4,519.64. Both the indices underperformed the Sensex.

The market breadth was strong. On BSE, 1,687 shares advanced as compared to 927 that declined. 59 shares remained unchanged.

Reliance Communications (up 19.92% to Rs 284.70), Reliance Infrastrucutre (up 17.13% to Rs 603.55), Sterlite Industries (up 15.99% to Rs 318.10), Mahindra & Mahindra (up 11.79% to Rs 520) , spurted from the Sensex pack.

India’s largest private sector company by market capitalization and oil refiner Reliance Industries rose 3.08% to Rs 1,574. A block deal of 3.01 lakh shares at Rs 1569.90 was struck on the counter on BSE today.

Capital goods stock extended gains after India and the US signed the 123 agreement on Friday, 10 October 2008, to open up sales of civilian nuclear technology to India. Larsen & Toubro, Bharat Heavy Electricals and Suzlon Energy rose between 11.61% to 16.39%. Punj Lloyd, ABB and Crompton Greaves gained more than 10% each.

Banking stocks spurted. BSE's banking sector index Bankex rose 12.51.% to 5,985.16 and was a major gainer from the sectoral indices on BSE. India’s second largest bank by net profit ICICI Bank spurted 16.71% to Rs 424.95 after the bank's chief executive K.V. Kamath today said deposits with the bank are safe, and that the bank had a cushion to take domestic and overseas shocks. His statements came amid concerns about ICICI Bank's exposure to the global financial crisis, which has send the stock crashing on the bourses. The stock had fallen 19.7% on Friday, 10 October 2008, recording a sharpest single day fall.

Other major lenders, State Bank of India and HDFC Bank rose more than 12% each. Yes Bank gained more than 10%.

Axis Bank rose 20.01% to Rs 662.80 after the private sector bank reported 76.85% surge in net profit to Rs 402.91 crore on 57.3% rise in total income to Rs 3,239.45 crore in Q2 September 2008 over Q2 September 2006. The bank announced the result during market hours today.

India’s largest telecom services provider by market share Bharti Airtel rose 6.76% to Rs 738. The companyadded 2.70 million mobile users in September 2008, unchanged from August 2008.

India’s largest aluminum maker by sales Hindalco Industries jumped 10.73% to Rs 89.30 on reports the aluminium-maker’s Rs 5,047-crore rights issue managed to sail through due to underwriting by promoters and banks.

Sintex Industries rose close to 10% after a block deal of 2.5 lakh shares was struck on the counter at Rs 212 on BSE.

Jain Irrigation Systems climbed close to 10% after a block deal of 3 lakh shares was struck on the counter at Rs 303 on BSE.

Emco fell 4% even as the company announced that a joint venture of the company is in advance talks to acquire 2 transformer makers in South Africa.

Zandu Pharmaceuticals Works fell 1.2% to Rs 14,900. A block deal of 19,549 shares was struck at Rs 14,880 on NSE.

Finance Minister P Chidambaram today said the Indian economy continues to grow at a satisfactory rate. The finance minister also said the slide in commodity and crude oil prices will have a beneficial impact on inflation. He said the Indian services sector is growing at a brisk rate. He said the ratio of investments to GDP remains high. The ratio was above 35% in Q1 June 2008.

The Reserve Bank of India chief Duvvuri Subbarao on Friday, 10 October 2008 said that India may escape the worst consequences of the global financial crisis due to its strong internal drivers for growth but money, debt and credit markets may be impacted indirectly.

In Europe, key benchmark indices in UK, Germany and France were up between 4.93% to 6.93% on reports 3 major UK banks will get an unprecedented 37 billion-pound ($64 billion) bailout from the UK government.

Asian markets were mostly higher today, 13 October 2008. Hong Kong's Hang Seng, China's Shanghai Composite,Singapore's Straits Times, and South Korea's Seoul Composite rose between 3.65% to 9.35%. Taiwan's Taiwan Weighted fell 2.15%.

Crude oil for November 2008 delivery rose as much as $3.37, or 4.3%, to $81.07 a barrel on the New York Mercantile Exchange today 13 Ocober 2008.

The domestic bourses had suffered heavy losses on Friday, 10 October 2008 on the back of global sell-off and on data showing dismal industrial production growth in August 2008. The BSE 30-share Sensex had lost 800.51 points or 7.07% to 10,527.86 and the S&P CNX Nifty was down 233.70 points or 6.65% to 3,279.95, on that day.

A global sell-off triggered the biggest weekly fall for Indian indices since 1990, last week. Fears the deepening credit crisis will push the global economy into recession, rattled stock markets across the globe. The BSE 30-share Sensex slumped 1,998.47 points or 15.95% to 10,527.85 in the week ended Friday, 10 October 2008. The S&P CNX Nifty was down 538.35 points or 14.09% to 3279.95 in the week.