Sensex snaps three-week losing streak, up 334 points | business | Hindustan Times
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Sensex snaps three-week losing streak, up 334 points

business Updated: Feb 22, 2014 23:48 IST

PTI
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The BSE benchmark Sensex snapped3-week losing streak by gaining 334 points as investors cheered the interim budget proposals coupled with Finance Minister P Chidambaram's announcement that the fiscal deficit will be contained at 4.6 per cent of the GDP for the fiscal year ending March 31, 2014.

Buoyant global cues after the US manufacturing activity, which hit its highest in nearly four years, also boosted investor sentiment in the domestic market. Positive comments by IMF about India's growth outlook also aided buying.

Fresh capital inflows into equity market also aided the firm trend as investors infused Rs 2,046.61 crore during the week, including the provisional figure of February 21, as per data issued by Sebi.

The Sensex resumed at 20,438.87 and shot up further to a high of 20,750.52 before settling the week at 20,700.75, showing a gain of 333.93 points or 1.64 per cent from its last weekend's level.

The NSE 50-share Nifty also rose by 107.10 points or 1.77 per cent to end at 6,155.45.

FM said the fiscal deficit for the ongoing financial year will be contained at 4.6 per cent, current account gap will be capped at USD 45 billion and net borrowing for 2014-15 would be lower than FY'14 revised estimates.

On GDP growth, he further commented that the economy is more stable than what it was two years ago following several steps taken by the government and that the growth will be higher in the second half of the fiscal.

Excise duty cuts in sectors such as auto and capital goods also led to renewed buying, said Rakesh Goyal, Senior Vice President, Bonanza Portfolio.

Small-cap and mid-cap shares also firmed up good demand from retail investors as its indices rose by 1.81 per cent and 1.75 per cent, respectively.

In last three weeks, the Sensex had plunged by 766.74 points or 3.63 per cent; while CNX Nifty fell by 218.40 points or 3.48 per cent.

Asian stocks closed higher after China's new credit increased to a record in January, boosting optimism the world's second-largest economy can maintain its growth momentum.

Banking stocks lead the upsurge on rising hopes that improving economic growth would boost lending business, traders said.

Twenty scrips out of the 30-share Sensex pack ended higher, while 10 scrips finished lower.

Major gainers were Axis bank (7.89 pct), Tata Power (6.57 pct), Larsen (5.90 pct), Dr Reddy's Lab (5.72 pct), Icici Bank (3.68 pct), HDFC (3.46 pct), M&M (3.26 pct), Infosys (2.91 pct) and Tata Motors (2.01 pct).

However, Bharti Airtel dipped by 5.37 pct, Coal India 3.51 pct, Hindalco 2.40 pct, SSLT 2.11 pct, RIL 1.42 pct, Cipla 1.29 pct and HUL 1.12 pct.

Among the S&P BSE sectoral indices, CG rose by 4.66 pct followed by Bankex 3.36 pct, Power 2.83 pct, IT 2.19 pct, HC 2.14 pct and Auto 1.67 pct. Total turnover at BSE and NSE was Rs 8,661.27 crore and Rs 42,435.24 crore, respectively, as against the last weekend's level of Rs 8,654.30 crore and Rs 47,461.93 crore.

Forex:
The rupee fell by 19 paise to close the truncated week at 62.12 against the greenback following fresh dollar demand from importers, breaking two weeks of rally.

The forex market was closed on Wednesday, February 19, in view of "Chatrapati Shivaji Maharaj Jayanti".

However, recovery in local equities and sustained capital inflows capped the rupee fall, a forex dealer said.

The US manufacturing activity, which hit its highest in nearly four years, supported the dollar, ultimately weighing on the rupee.

At the Interbank Foreign Exchange (Forex) market, the domestic unit commenced slightly lower at 61.96 a dollar from last weekend's close of 61.93 and moved in a wide range of 61.83 and 62.45 before settling at 62.12, revealing a fall of 0.19 paise or 0.31 pct.

In last two weeks, it had risen by 75 paise or 1.20 pct.

The benchmark S&P BSE Sensex made a strong rebound and closed up by almost 334 points or 1.64 pct while FIIs infused USD 232.45 million during the week till February 20.

Pramit Brahmbhatt, CEO, Alpari Financial Services (India), said, "After gaining for two consecutive weeks, the rupee closed on a weak note taking cues from strong dollar index as yesterday US dollar jumped against the Australian dollar after a weaker-than-expected reading of a Chinese manufacturing estimates were released." "The dollar demand from local oil importers further dented the rupee movement. Expect rupee to depreciate further in coming days as despite of mixed data released yesterday which has raised the concerns about the economic growth, Investors have chosen dollar over the safe havens which will force rupee to trade weak. The trading range for the USD/INR pair is expected to be within 61.50 to 63.00.

Meanwhile, Finance Minister P Chidambaram in its interim budget stated that the fiscal deficit will be contained at 4.6 pct of GDP for the year ending March 31, 2014, curtailing the current account deficit gap to USD 45 billion and net borrowing for 2014-15 would be lower than FY'14 revised estimates.

On GDP growth, he further commented that the economy is more stable than what it was two years ago following several steps taken by the government and that the growth will be higher in the second half of the fiscal.

Forward dollar premiums continued to slide following consistent export receipts.

The benchmark six-month forward dollar premium payable in July plunged to 225.5-227.5 paise from last weekend's close of 238.5-240.5 paise.

Far-forward contracts maturing in January also tumbled to 468.5-470.5 paise from 482-484 paise.

The RBI fixed the reference rate for the US dollar at 62.1618 and for the euro at 85.2685 from 62.2770 and 85.1755, respectively.

The rupee declined further against the pound sterling to 103.60 from last Friday's close of 103.44 and also fell against the euro to 85.15 from previous weekend's close of 84.79.

However, it strengthened further against the Japanese yen to 60.63 per 100 yen from preceding weekend's close of 60.82.

Oils and oilseeds: Industrial oils and refined palmolein advanced while linseedoil eased at the oils and oilseeds market during the week under review.

Groundnut oil mostly traded mute in the absence of any large-scale buying activity amid ample supplies to end stable.

Refined palmolein surged further on heavy stockists and retail demand supported by bullish Malaysian cues.

Linseed oil eased following lower offtake from paints and allied industries.

Castor seeds bold and castor oil commercial hardened owing to persistent demand from shippers and soap industries.

In the edible oils segment, groundnut oil opened steady, later went-up to Rs 760 but drifted to settle at the last weekend level of Rs 750 per 10 kg.

Refined palmolein resumed higher at Rs 598 and climbed further to close at Rs 608 from preceding weekend's level of Rs 590, showing good gain of Rs 18 per 10 kg.

In the non-edible section, castor seeds bold opened stable at Rs 3,925, later declined to 3,915 before rebounding to end at 3,975 from last weekend's level of Rs 3,925, showing a gain of Rs 50 per 10 kg.

Castor oil commercial also resumed steady at Rs 815, but later eased to Rs 813 before recovering to conclude at Rs 825 from preceding weekend's level of Rs 815, showing a rise of Rs 10 per 10 kg.

Linseed oil opened lower at Rs 835 and trade same to finish at Rs 835 from previous weekend's level of Rs 840, showing modest loss of Rs 5 per 10 kg.

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