Last lap surge; Nifty above 5000

Today's major news

Reliance Communications rings as Etisalat eyes stake; the stock surges 11.02%

Hero Honda raises prices by up to Rs1,000; the stock up 3.28%

India's manufacturing PMI hits 27-month high

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Post-market summary

Global signals

The European shares fell on Wednesday, with British Petroleum down after the US launched a criminal probe into the Gulf of Mexico disaster and banks slipping on worries over the recovery from the Euro zone crisis.

The Asian indices closed mixed. SGX Nifty closed 60.5 points higher.

The US stock index futures rose on Wednesday, recovering from a sell-off in the previous session as investors awaited monthly data on pending home and auto sales.

Indian indices

The domestic market, ignoring all the negative cues around the globe, recouped yesterday’s heavy losses. The market witnessed high volatility throughout the day. The Nifty struggled for direction and was stuck in a narrow trading band of 4980-5000. However, the Nifty managed to close above the 5000 mark.

Telecom was buzz on the street today on merger and acquisitions news. The Sensex heavy-weight Reliance Communications surged 11% on the news that UAE's Etisalat Emirates Telecommunications Corp (Etisalat) is in talks to buy 25% stake in the company. The auto stocks too rallied smartly after announcing good sales numbers for the month of May. Today, the Indian indices extracted positive cues back home, which boosted the market sentiments to end the session a strong note.

The key benchmark index, Sensex, opened flat with a positive bias, mere two points higher at 16574.79 and extended its gains as the session progressed. The market sentiments were constructive due to buying interest seen in the telecom and auto shares. However, weakness in Asian and European markets opening negative, pulled the index to touch the day’s low of 16571. However, in the last hour of trade, the Sensex regained strength and surged 203 points to touch the day’s high of 16,774. At closing bell, the Sensex quoted at 16742, 170 points higher. The Nifty closed above 5000 levels, at 5020, up by 50 points.

Market sentiment

The market breadth was strong. Of 2,889 stocks traded on the BSE, 1,663 stocks (57.56%) advanced, whereas 1,097 (37.97%) stocks declined. Hundred and twenty-nine stocks remained unchanged.

Sectoral & stock screening

All the sectoral indices closed higher for the day. BSE TECk gained 1.95% on news that UAE-based company Etisalat is indeed in talks with several Indian telecom operators to buy a stake, followed by BSE Auto that surged by 1.74% after unveiling robust sales figures for May 2010. BSE Metal, which rallied in the previous session, is the second last gainer in the sectoral list, with a gain of 0.46%.

The top-3 gainers were — Reliance Communications surged by 11.02%, Idea Cellular that rose by 8.97% and Religare Enterprises that was up by 8.55%.
The top-3 losers were — REI Agro that slid by 5.22%, Cadila Health that was down by 3.08% and Punj Lloyd that declined by 2.69%.

Viewing volumes

India’s second largest telecom operator — Reliance Communications was the most traded share with over 1 crore shares changing hands on the BSE, followed by natural resources company — Reliance Natural Resources (0.71 crore shares), wind power major — Suzlon Energy (0.70 crore shares), industrial finance company — IFCI (0.69 crore shares) and construction company — Unitech (0.50 crore shares).