Sensex breaches 28,000, but BHEL, Tata Steel still down from life highs

November 5, 2014

The BSE Sensex surged to a fourth straight life high on Wednesday, breaching the psychologically important 28,000 mark as banking shares continued their rally on hopes of a rate cut by the Reserve Bank of India (RBI).

The benchmark has now gained 31.86 percent in 2014.

But the bull run has not benefited all stocks. Twenty six Sensex components were away from their life highs on Wednesday with some power and metals stocks trading fairly lower than their all-time high levels.

As of Wednesday’s close, BHEL was down 55.7 percent from its record high of 585 rupees hit in November 2007, while Tata Steel was down 49.3 percent from its record high.

G Chokkalingam, founder, Equinomics Research & Advisory, said shares of power and metals were either victims of industrial stagnation or sector-specific issues.

“If you take Tata Steel, steel is suffering from industrial stagnation, overall industry is stagnating for last 18 months … If you take BHEL, NTPC, they are (facing) power sector problems – availability of fuel or clearance of dues to BHEL,” said Chokkalingam.

On the winning side, ICICI Bank, Axis Bank, HDFC Bank and Infosys touched their all-time highs in Wednesday’s trade.

Lenders gained on growing expectations the RBI would slash rates as early as December when the central bank reviews its monetary policy.

(Editing by David Lalmalsawma; Follow Sankalp on Twitter @sankalp_sp and David @davidlms25 | This article is website-exclusive and cannot be reproduced without permission)

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