Money on the markets

A maturing market amid the mayhem

Sensex gains on bargain hunting

March 6, 2009

The BSE Sensex closed 1.56 percent higher on Friday as investors saw an opportunity in the battered market that had plunged to its lowest in three years in the previous session.

The benchmark closed at 8352.82, supported by index heavyweights Reliance Industries (up 1.8percent), NTPC (up 2.2 percent) and Bharti Airtel (up 2.1 percent).

The BSE IT Index remained the frontrunner, closing 3.05 percent higher on the recent slide in the rupee.
Shares in Satyam Computer gained 19.94 percent after the fraud-hit outsourcer won regulatory approval to sell a majority stake in itself. Wipro and Infosys were up around 3 percent each. MARKETS-SOUTHASIA-STOCKS/

Selling pressure was seen in Maruti Suzuki, HLL and Ranbaxy, which were down in the range of 2-3 percent.

The Sensex remained volatile for most part of the trade but gained momentum on gains in European markets.

Strong voices came out this morning and spoke about the breadth in the Indian economy, which added to investor sentiments. A senior RBI official said there were no signs of financial crisis in India, while the chief economic adviser said India would be able to meet its fiscal responsibility targets.

Government data released today showed infrastructure sector output grew 1.4 percent in January from a year earlier, below an unrevised 2.3 percent in December.

But major concerns for the week ahead remain. FIIs, who have pulled about $2.2 billion from Indian stocks this year and $609.3 million in this week itself, are expected to step up their withdrawals.

Add to this, weak global equity markets, widening fiscal deficit and the recent downgrades by S&P and Moody’s. These are likely to weigh on investor sentiments.

Do you think Indian markets will be able to extend today’s gains when they open next week? Will the coming elections weigh on investor sentiments and discourage them from building large positions?

Post Your Comment

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
  •