Sensex jumps over 200 points

The Sensex kept on strengthening as the day progressed, barring that odd blip in the early-afternoon session, as buying continued unabated during the session. That markets around the globe were firm, also boosted sentiment. Some short-covering in the derivatives segment provided the much-needed shot of adrenaline to the market.

The 30-shares BSE Sensex settled 214.37 points (1.72%) higher, at 12,644.77, as per a provisional closing. It had opened higher in the morning, at 12,484.64, and surged to 12,655, at the fag end of trading. The Sensex's low for the day has been 12,426.66.

Trading was halted in between, at 11:45 IST, for sun outage. It resumed at 12:30 IST. The trading time was extended till 16:15 IST. Today was the last session with a staggered schedule. From Tuesday (20 March 2007), the market will close as usual (15:30 IST).

The turnover on BSE aggregated Rs 2385 crore, and was very much below the turnover on a regular day. The lacklustre turnover is because of a bank holiday on account of Gudhi Padva today. As a result, the settlement for trading done on Friday (16 March 2007) and today’s was clubbed for 21 March 2007. Brokerages have advised clients that shares purchased on Friday (16 March) should not be sold on 19 March 2007.

The market-breadth, which indicates the overall health of the market, looked strong on BSE. Against 1,402 shares advancing, 1,124 declined. A total of 72 scrips remained unchanged.

Among the 30-Sensex pack, 24 advanced while the rest declined.

State-run Bharat Heavy Electricals (Bhel) surged 6.46% to Rs 2082, and was the top gainer, on reports that the company was in talks with two overseas firms for nuclear technology deals. Bhel also informed BSE that the tentative performance for FY 2007 will be announced on 3 April 2007, at a press conference to be addressed by the chairman & managing director.

Reliance Communications (up 5.56% to Rs 397.85), ONGC (up 3.90% to Rs 791.90) and Gujarat Ambuja Cements (up 3.71% to Rs 107.50) were the other gainers.

Tata Motors edged up 3%, to Rs 772, for the second day in a row today. Managing Director, Tata Motors, Ravi Kant said on Thursday its small car project coming up at Singur, Kolkata, was on track and would be completed by the middle of next year.

Hindustan Lever rose 1.84% to Rs 180.05, on news that the company had hiked prices of its detergent brands, Surf Excel Blue and Surf Excel Quick Wash.

Car maker Maruti Udyog (MUL) rose 1.40% to Rs 790.35, after the Indian government said it will sell its remaining 10.27% stake in the former PSU in the next financial year, beginning 1 April 2007. The cabinet has approved the plan for a stake sale in the firm, which is restricted to participation from banks, financial institutions and Indian mutual funds. MUL is 54.2% owned by Japan's Suzuki Motor Corp. It was an equal joint venture between the Indian government and Suzuki, when the previous NDA-led regime at the Centre began selling the holding as part of efforts to exit non-core sectors of the economy.

Index heavyweight Reliance Industries (RIL) was up 0.96% to Rs 1312.25, on a volume of 3.94 lakh shares.

Cigarette maker ITC declined 2.21% to Rs 141.80, on high volumes of 24.84 lakh shares. It was the top loser. Two block deals of 5 lakh shares each were struck in the counter for an average Rs 142.25 per share by 10:47 IST.

Bike maker Hero Honda down 1.87% to Rs 640, and drug maker Dr Reddy’s Labs was down 1.04% to Rs 675, were the other losers in the Sensex pack.

IFCI surged 8.35% to Rs 26.60, on high volumes of 2.01 crore shares, on BSE.

Among Asian benchmarks, Japanese Nikkei 225 Index surged 265.40 points (1.59%) to 17,009.55, the Hang Seng rose 313.24 points (1.65%), to 19,266.74, the Straits Times gained 44.64 points (1.45%) at 3,113.39, the Seoul Composite rose 15.51 points (1.09%), to 1,443.39 and the Taiwan Weighted was up 17.66 points (0.23%), to 7,737.46.

European markets were also trading positive, with gains ranging between 0.28 - 1.50%.

Over the last few weeks, local bourses had slipped due to weakness in global markets.

Meanwhile Finance Minister P Chidambaram said on Monday that India is confident it can moderate inflation, and the aim was to do so without hurting growth.

The next major trigger for the bourses is Q4 March 2007 earnings, reports of which by corporates will start next month. Market men will closely watch what company managements have to say about the outlook for FY 2008. Global liquidity still remains strong, and may provide the trigger for a recovery.

An important event being keenly awaited are the meetings this week of the central banks in Japan and the US, to decide on interest rates. The Bank of Japan’s two-day meeting ends on Tuesday (20 March 2007), while the US Federal Reserve’s two-day meeting ends on Wednesday (21 March 2007). The Fed is expected to keep interest rates unchanged. Analysts will eagerly hunt for cues for the US economic outlook in the Fed’s accompanying statement.

Although FIIs resumed buying on Thursday (15 March 2007), their daily volume as reflected in daily gross sales and purchase figures for the day was low. They were net buyers to the tune of Rs 18.50 crore on Thursday (15 March 2007) compared to their outflow of a huge Rs 861.40 crore on 14 March 2007.

An intermittent surge in funds and withdrawal of funds by FIIs has been observed this month. As per provisional data released by the National Stock Exchange (NSE), FIIs were net sellers to the tune of Rs 202 crore on Friday (16 March 2007), the day when the Sensex had lost 113 points.

FIIs were net sellers to the tune of Rs 563 crore in index-based futures on Friday. They were net buyers to the tune of Rs 104 crore in individual stock futures on the same day. Nifty March 2007 futures settled at 3,582.30 on Friday, a discount of 26.25 over the spot Nifty closing of 3,608.55.

US crude oil rose 19 cents to $57.30 a barrel, after falling as far as $56.17 last week on worries of an economic slowdown in top consumer, the United States.

US stocks fell on Friday, as data showing strong consumer price inflation dented hopes for an interest-rate cut any time soon, while fears about the subprime mortgage crisis kept investors on the edge. A government report showed February consumer prices rose faster than analysts estimated, while core CPI, which strips out volatile food and energy costs, matched forecasts.

The Dow Jones industrial average fell 49.27 points, or 0.41%, to end at 12,110.41. The Standard & Poor's 500 Index dropped 5.33 points, or 0.38%, to 1,386.95. The Nasdaq Composite Index slipped 6.04 points, or 0.25%, to 2,372.66.