Markets buoyant, Sensex up 744 points | business | Hindustan Times
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Markets buoyant, Sensex up 744 points

business Updated: Oct 31, 2008 17:44 IST

Extending gains for the third day in a row, stock markets on Friday staged an impressive come back rally with the benchmark Sensex closing the day higher by nearly 750 points on brisk buying by funds.

Marketmen said slew of favourable factors boosted investor sentiment which was at its lowest ebb after sustained heavy selling in bourses across the world for about a month.

The 30-share index settled the day higher by 743.55 points at 9,788.06, after opening strong and even posted a gain of over 825 points during intra-day.

The wide-based National Stock Exchange index Nifty also rose by 188.55 points at 2885.60.

Brokers said besides a fall in inflation to below 11 per cent, anticipation of rate cut by the central bank revived invesotrs's interest in buying as they feel that both lower lending and inflation rates bode well economic growth.

Inflation has come down to 10.68 per cent for mid-October. Besides, US central bank Federal Reserve and the Bank of Japan have massively cut rates, prompting many to believe that RBI will follow suit.

Rating agency Standard & Poor's reaffirming stable outlook for India also intensified buying support, they said.

Analysts said the bellwether index still recovering from the 23 per cent massive drop it has seen this month, the most on record, which saw the Sensex pluning below 8,000 level.

IMG decision to almost double borrowing limits for emerging markets and waive demands for economic austerity measures also helped turn around the sentiments on bourses.

The rally came after a day's break, when the MSCI Asia Pacific Index added 9 per cent, after the US Federal Reserve cut interest rate by 0.50 basic points and agreed to provide 30 billion dollar each to central banks in Brazil, Mexico and South Korea. The upsurge in the market was supported by stocks in metal, oil and gas, bank and capital goods. The rise in sectoral indices ranged between 2.74 and 10.20 per cent.

ICICI Bank surged 15.50 per cent, its biggest gain in three weeks. ICICI was hammered regularly on rumours casting doubts over its financial health in the last few weeks.

Oil and gas index gained the most by 517.29 points at 6195.62, followed by metal index by 496.73 points at 5367.60. Bank index shot up by 336.90 points at 5011.24.

Capital goods index rose by 333.90 points at 7017.61, information technology index by 156.17 points at 2861.94, auto index by 161.22 points at 2685.62, teck index by 133.83 points at 2161.45, PSU index by 121.57 points at 4564.92, power index by 83.13 points at 1583.37, healthcare index by 86.92 points at 2778.64, FMCG index by 57.76 points at 1799.83, consumer durable index by 45.56 points at 2072.98 and realty index by 44.40 points at 1978.24.

Midcap index shot up by 105.54 points at 3200.02 and smallcap index by 90.50 points at 3765.11.