Sensex up 68 pts on growth prospects
Stock markets were bolstered by a firm tend in the Asian region and higher openings in Europe as crude oil prices eased, after the producing countries said they would boost output in case the Middle East turmoil hits supplies.
Fall in global crude oil price to less than USD 98 a barrel in New York calmed near term fears, helping world markets rebound from the recent sell-offs, said a broker.
Besides, the Railway Budget this afternoon unveiled plans for adding new lines – a positive for infrastructure.
The gains were led by stocks in the financial, FMGC and auto sectors.
However, marketmen remained cautious that crude oil prices will continue to daunt the sentiment. They also said worries remain over further rise in interest rates in view of persisting inflationary pressures.
"We expect the downward pressure to prevail in the near term. Union Budget will be an important event next week. At the same time, one can`t afford to ignore the external developments, especially in the Middle-East," IIFL (India Private Clients) Head of Research Amar Ambani said.
Sanjay Bhambri of Hi-Tech Securities said higher oil prices will remain the main concern for the market.
The Bombay Stock Exchange 30-share barometer moved both ways in a range of 17,812.44 and 17,469.97 before ending the day at 17,700.91, a rise of 68.50 points or 0.39 per cent. In last three trading sessions, it had tumbled by 805.90 points or 4.37 per cent.
Similarly, the NSE 50-issue Nifty also recouped by 40.85 points or 0.78 per cent to 5,303.55.
The Survey, tabled in Parliament, projected 9 per cent growth for 2011-12, up from the expected 8.6 per cent this fiscal. Besides, it projected a lower fiscal deficit of 4.8 per cent, from the Budgeted 5.5 per cent.
However, it expressed concern over high inflation, which could lead to monetary tightening, and hinted at further exit from the economic stimulus measures put in place to combat the global financial meltdown that started in 2008.
Marketmen said investors felt relief that the Rail Budget did not hike freight rates and passenger fares.
Buying in heavyweights like ICICI Bank, ITC, Tata Motor and SBI pushed up the Sensex.
As per provisional data, Foreign Institutional Investors (FIIs) sold shares worth Rs 2,702.22 crore yesterday.
On the overseas front, besides China which closed stable, other Asian markets finished with marked gains between 0.68 per cent and 1.82 per cent.
European stocks too were quoting up in their afternoon deals on week-end short-coverings.
Overall, 13 out of 30 index-based stocks closed with gains while others finished with losses. Tata Motor firmed up 4.43 per cent, ICICI Bank (3.55 pc), ITC (3.00 pc), SBI (2.09 pc), Jindal Steel (1.87 pc), Wipro (1.73 pc), Jaipra Asso (1.40 pc), Bharti Airtel (1.18 pc) and Tata Steel (0.97 pc).
However, RCom dropped 5.40 per cent, REL Infra (4.58 pc), M&M (3.38 pc), Hindalco (2.48 pc), Sterlite Ind (2.23 pc), BHEL (1.23 pc) and HDFC Bank (1.08 pc).
Amongst sectoral indices, BSE-FMCG spurted 2.20 per cent, and Bankex by 1.86 per cent.
Reflecting selling in second-line counters, the total market breadth remained negative as 1,589 stocks closed in the red while 1,273 finished in the green on the BSE.