Market Review: Sensex storms past 19K as capital goods rally

It has been a historic week for the Indian stock market as it peaked to an all-time high above the 19,000 mark and managed to sustain that level. Stocks rallied after market watchdog Securities and Exchange Board of India (SEBI) dispelled confusion on curbs on overseas investors to participate in Indian equities.

The benchmark index of the Bombay Stock Exchange (BSE) finally closed Friday with a gain of 472 points at 19,243 -- near its all-time high of 19,276 -- while the broader S&P CNX Nifty ended the session by adding 133 point at 5,702 on Friday.

The SEBI on Tuesday said that further Participatory Notes, or instruments used by foreign institutional investors (FIIS) to participate in the Indian market, would be issued only till the firms had registered themselves.

The SEBI move was to bring transparency into the capital market. SEBI chairman M. Damodaran also allowed overseas pension funds, charitable funds and university funds to participate in the Indian bourses as FIIs.

This good news led to a surge in the markets, which opened the new series on a robust note as the bulls took charge of the markets. The Sensex saw thumping gains of 500 points and the broader markets also notched up significantly.

Capital goods stocks led the rally after sector heavyweight Larsen and Toubro posted a whopping 73 percent rise in net profit from the previous quarter which led the stock to jump by 12.40 percent and close at Rs.3,885.

Capital goods stocks were in the limelight during the week.

Laxmi Machine Works flared up by 14.98 percent to Rs.3,171, Crompton Greaves rose by 7.44 percent to Rs.420 and Kalpataru Power scaled up by 6.81 percent to Rs.1,795.

The market breadth was looking positive as the trade volumes across the board were very impressive. Of the 2,833 stocks traded on the BSE, 1,737 stocks advanced, 1,029 declined and 67 ended unchanged.

Among the sectoral indices, the BSE capital goods index was the major gainer and rose 7.08 percent followed by the BSE PSU Index that rose 3.93 percent and the BSE Bankex Index that gained 3.52 percent.

Over 27.5 million Reliance Natural Resources shares changed hands on the index followed by Himachal Futuristic Communication (20.5 million shares), Reliance Petroleum (20.3 million shares), Tata Teleservices (15.7 million shares) and Power Grid Corporation (14.6 million shares).

Value-wise L&T clocked a turnover of Rs.4.33 billion followed by Reliance Petroleum (Rs.4.04 billion), Reliance Industries (Rs.3.63 billion), Reliance Natural Resources (Rs.2.72 billion) and Reliance Energy (Rs.2.65 billion).


Indo-Asian News Service