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Reliance leads Sensex rally

April 2, 2009

The BSE Sensex today crossed the psychological mark of 10,000 and ended 446 points higher, its best close in nearly five months, guided by strong Asian and European markets.

The benchmark index ended at 10,348.83, while the 50-share Nifty ended 150.7 points higher at 3,211.05.
Reliance Industries surged more than 5 per cent on reports the company has started pumping gas from the KG basin, which at full throttle will nearly double India’s gas output.

The Sensex rise was led by Reliance Industries (up 5.2 percent), ONGC (up 8.2 percent) and L&T (up 6.6 percent).

Top among the gainers were DLF, Jaiprakash Associates and Tata Motors, all gaining over 12 percent.

The BSE Realty index emerged on top, posting gains of 9.1 percent. Anant Raj Industries, HDIL and DLF were up in the range 6-15 percent.

The sectoral picture looked healthy with most indices closing in the green. The BSE Oil & Gas Index ended 5.7 percent up, while the Banking Index closed 4.7 pct higher.

Latest data shows the wholesale price index, India’s most widely watched inflation measure, rose 0.31 percent in the 12 months to March 21. Analysts say it is likely to turn negative in the coming weeks, which would provide enough room for a further easing of monetary policy by the Reserve Bank of India (RBI).

Do you think a further softening of policy measures will trigger another rally?


Sensex had a fruitful day on thursday as it rose 446 points(4.51%)to touch 10,348 points.It has risen 701 points(7.2%)in 2009.At 10,348 it has managed to excorcize the ghost of Satyam(10,335). Had Satyam not happened,who knows we could have been already touching 10,600.

The sensex movement shows 2 notable rises viz.DLF(+15%) and Jaiprakash(+13.23%. The realty sector is still in doldrums.An unexplicable rise of this magnitude in stocks puts a fear of a “share-price bubble”.The realty sector has been window-dressing their quarterly results, and it is being expected that an undo action will be taken in annual results. If more sectors are doing the same,we could end up with some amount of pain.

Many investors are asking whether rebound of 2,188 points (26.8%)since 9 March was predictable,and more importantly:What is next in store? Some more immediate upward movement can be expected on account of assurances made at G-20 summit as some of policy decisions may help India’s much -needed export thrust.
But ofcourse April and May months may have in store some exceptional uncertain developments like 4Q results,CPI rise,monsoons,new government formation and overall a slowing economy.If we make a start to tackle these problems,we could be able to hold sensex between 9,500 to 10,200 till post-16 May,and thereafter await a next trigger to 12,000.

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