Stocks bounce back, but fears persist
Even as global markets formed a mixed bag, Indian equities staged a pullback rally on Friday as buying came in at lower levels in index heavyweight stocks. The mood on Dalal Street is still one of apprehension.
While the benchmark Sensex of the Bombay Stock Exchange ended the day higher by 403 points or 2.63 per cent at 15760 points, the wider Nifty of the National Stock Exchange closed at 4688.75 points, up by 65.15 points or 1.41 per cent.
Though the rate of inflation rose to 5.11 per cent for the week ended on March 1, 2008 on higher prices of food items and manufactured products, value-buying in Sensex stocks that were battered during the past sessions helped the Sensex close in the green.
However, indicating continuing weakness, the market breadth was negative on the BSE with only 1,214 stocks advancing against 1,458 declines.
"The markets have not yet shown any clear direction. The answer to where the bottom of this market is will rather be – when the IIP (index of industrial production) bounces back to double-digit growth, when FIIs (foreign institutional investors) make a comeback and when interest rates ease off. Until then, the markets will continue to be volatile," said Madhukar Sheth, a BSE broker.
As per the provisional data available on the NSE website, foreign institutional investors were net sellers of Indian equity worth Rs 358 crore, while domestic funds were net buyers to the tune of Rs 100.33 crore.
The biggest Sensex pack gainers were Reliance Energy (up 8.26 per cent at Rs 1296.15), Jaiprakash Associates (up 7.83 per cent at Rs 236.25 and DLF (up 7.83 per cent at Rs 654.25).