Sensex bounces back, rallies to new 32-month high | business | Hindustan Times
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Sensex bounces back, rallies to new 32-month high

business Updated: Sep 17, 2010 17:01 IST
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The BSE benchmark Sensex climbed 177 points on Friday, fuelled by a surge in RIL and blue-chip telecom stocks, to close at a fresh 32-month high on sustained capital inflows and firm global cues.

The 30-share barometer of the Bombay Stock Exchange ended the day higher by 177.26 points, or 0.9 per cent, at 19,594.75, erasing the 85-point loss it suffered in the last session. In intra-day trade, the index breached the 19,600 mark.

The Sensex ended the week at its best level since January 17, 2008. During the week, the Sensex recorded a gain of 4.2 per cent, its best weekly rise so far this year.

The National Stock Exchange's wide-based 50-share Nifty index also added 56.25 points, or 0.97 per cent, to finish the session at 5,884.95.

Analysts attributed the rally in Indian stock markets to higher capital inflows from overseas investors.

"The market is sustaining the rally as inflows from overseas investors is coming in relentlessly and in the coming days too, this rising spree is likely to continue," Geojit BNP Paribas Research Head Alex Mathews said.

On the back of huge inflows from foreign institutional investors, the Sensex has been on a rising spree for almost the entire week to trade above the 19,500-level for the first time in two-and-a-half years.

FIIs infused a whopping Rs 11,300 crore (or USD 2.43 billion) into domestic equities in the first fortnight of the current month, taking their total investment so far to over Rs 70,000 crore.

Reliance Industries Ltd, which holds the maximum weight in the Sensex, zoomed 2.58 per cent to finish at Rs 1,026.75 on the back of media reports that the Mukesh Ambani-led energy major is in talks to buy another shale gas project in the US.

"Reports of shale gas deal fuelled the rally on Reliance counter," Mathews added.

Telecom stocks were on a high today, with RCom zooming 5.28 per cent to emerge as the best performer in the 30-share Sensex pack.

The country's top telecom operator, Bharti Airtel, surged by nearly 3 per cent.

Equity analysts said telecom stocks attracted heavy buying as the investor sentiment turned buoyant after technology shares gained overseas, following better-than-estimated profits from RIM and Oracle Corp.

Metal stocks, too, were in demand. Sterlite Industries rose 2 per cent, Tata Steel 1.6 per cent, Hindalco 1.5 per cent and Jindal Steel 1.4 per cent.