High GDP growth helps erase early losses, Sensex gains 116 pts
Better than expected economic growth numbers for the second quarter this fiscal helped stock markets erase early losses today, with the BSE benchmark Sensex ending the day with a gain of over 116 points.business Updated: Nov 30, 2010 17:19 IST
Better than expected economic growth numbers for the second quarter this fiscal helped stock markets erase early losses on Tuesday, with the BSE benchmark Sensex ending the day with a gain of over 116 points.
Spurred by 8.9% GDP growth recorded during July-September quarter, and a firm European trend, funds bought stocks pushing up the BSE benchmark index.
The Sensex, which had lost nearly 1% at the outset, bounced back to close with a gain of 116.15 points at 19,521.25 on revival of investor confidence. It had touched the day's low of 19,218.02.
The broad-based National Stock Exchange (NSE) index Nifty rose by 32.70 points to 5,862.70, after dipping to the day's low of 5,768.35 points.
Investor confidence regained on reports that the economy grew by 8.9% during Q2, from 8.7% in the same period 2009, driven by better performance of agriculture and manufacturing sectors.
Trading sentiment further turned bullish as European stocks opened higher on Tuesday afternoon.
Besides, market seemed to respond positively to the assurance by finance minister Pranab Mukherjee that investor money is safe as far as fallout of the housing finance racket was concerned. Last week, CBI arrested 8 officials of several public sector banks and institutions.
The realty stocks, which had touched recent lows after the outbreak of the bribery-for-loans scam, mainly led the upward march. The realty sector index was the best performer by rising 5.67% to 2,925.40.
DB Realty, a construction company named in the CBI probe, hit a daily upper limit by adding 5% to Rs 207.90. DLF Ltd, not named the the scam, added 7% to Rs 307.25. The stock had plunged 20% as of Monday, since the Sensex hit a record high on November 5.
However, Money Matters Finance, a company at the centre of the controversy remained under pressure and hit its daily lower limit by losing 10% to Rs 309.90. It has tumbled 60% ever since the outbreak of bank scam last week.
The consumer durable index was second best performer, rising 2.08% to 6,434.44 followed by power sector index by 1.84% to 2,891.48.
Other supporter to the market were stocks in Power, PSU, FMCG, Auto, Teck and Banking sectors. However, oil and gas sector declined by 0.56% to 10,062.08 as stocks of Reliance Industries, GAIL India and BPCL closed lower.
As the buying activity spilled over a wide-front, smallcap index gained 1.90% to 9,744.71 and midcap index by 1.39% to 7,764.02.