Equities
showed signs of strength on Wednesday, recovering most of intra-day losses overlooking a steep fall in US and European
markets.
The indices opened gap-down but climbed steadily as buying emerged in select frontline stocks
while traders chose to sit on sidelines.
Bombay Stock Exchange’s Sensex ended at 9,618.54, down 28.93 points or 0.3 per cent from the previous close. The index touched a high of 9648.39 and low of 9459.59.
National Stock Exchange’s Nifty closed at 2925.70, down 0.05 per cent or 8.8 points. The broader index hit a high of 2937.50 and low of 2877.60.
“Optimism is back in the market as investors have begun reacting to positive news. People, for a change, are not looking at the US for direction, else we would not have bounced back despite of poor show from US and European markets,” said S Ranganathan, head of research, LKP Securities.
Second rung stocks outperformed the benchmarks by ending in the green following news-based action. BSE Midcap Index was up 0.37 per cent and BSE Smallcap Index moved 0.25 per cent higher.
“Gas based fertiliser companies were in action on reports that they would benefit as RIL gas would flow to them. Buying emerged in Astra Microwave and BEL on joint venture. We expect the market to react positively to these kind of stock/sector specific developments for at least next one month. The interim budget and rail budget may also trigger markets,” Ranganathan added.
RCF shares ended 8.53 per cent higher at Rs 36.90, Nagarjuna Fertilisers rose 6.05 per cent to Rs 18.40, National Fertilisers advanced 12.24 per cent at Rs 30.25.
Astra Microwave surged over 8 per cent after the company announced a preliminary deal with Bharat Electronics to form 51:49 joint venture. The JV would design, develop, prototype, manufacture and market microwave products for use in defence, space and telecommunications.
PSU banking stocks rose after the Cabinet approved a government proposal to infuse Rs 3,800 crore into three state-run banks in two tranches over FY09 and FY10.
Home Minister P Chidambaram said, UCO Bank will get Rs 1200 crore in fund infusion – Rs 450 crore in FY09 and the remaining Rs 750 crore in FY10. Central Bank of India will get Rs 700 crore each this fiscal and the next while Vijaya Bank will get Rs 500 crore in FY09 and another Rs 700 crore in FY10.
Shares of Central Bank ended 2.76 per cent higher at Rs 39.10, Vijaya Bank climbed 2.79 per cent to Rs 29.50 and UCO Bank surged 3.58 per cent to Rs 28.90.
Amongst the sectoral indices, BSE Auto ended 0.8 per cent higher on reports that the government may announce some relief to the industry in the form of excise cuts while presenting the interim budget.
The BSE Power Index ended up 0.2 per cent, BSE Bankex closed flat and BSE FMCG Index moved up 0.17 per cent.
BSE Healthcare Index was down 1.2 per cent, BSE Metal Index declined 1.19 per cent and BSE IT Index fell 0.65 per cent.
Gains in Maruti Suzuki (4%), ACC (2.64%), Jaiprakash Associates (2.47%), Tata Power (1.81%), Bharti Airtel (1.72%) and HDFC (1.63%) helped the Sensex end off lows.
Ranbaxy Laboratories (-5%), Grasim Industries (-4.07%), Reliance Infrastructure (-3.73%) and Tata Steel (-3.38%) and Tata Motors (-2.09%) remained weak.
Market breadth was positive on the BSE with 1,263 advances and 1,138 declines.
US markets are set to open higher after a steep fall in previous session. Dow Jones stock futures were up 0.38 per cent, S&P 500 was up 0.33 per cent and Nasdaq gained 0.20 per cent.
