BSE Sensex ends up, tech stocks gain

mumbai  September 6, 2012, 17:32 IST

mumbai  09 06, 2012, 17:40 IST

 

The BSE Sensex ended higher on Thursday led by gains in technology shares, ahead of a crucial meeting of the European Central Bank, which may announce new policies to contain the euro zone crisis.

IT services providers such as Infosys, which draw about three quarters of their revenue from the U.S and Europe, led the gainers on hopes of improved spending environment after ECB easing.

ECB chairman Mario Draghi is set to unveil his plan later in the day to save the euro. European stocks also edged higher in anticipation of the ECB's action, but fears of a disappointment weighed.

 

Traders expect any substantial action by the ECB can lead to a relief rally in the domestic market, providing respite from the recent range-bound trade.

"While ECB is important, there seems to be a floor around 5,000 as inflation is easing and a cap around 5,600 for Nifty due to government inaction on reforms," Sandeep J. Shah, CEO of Sampriti Capital, said.

"But if ECB announces substantial measures Nifty can rally by 200 points."

The benchmark BSE index <.BSESN> rose 0.19 percent to end at 17,346.27 points.

The 50-share NSE index <.NSEI> ended up 0.24 percent at 5,238.40 points.

Infosys ended up 3.53 percent, while Wipro added 4.24 percent. The benchmark for IT shares <.CNXIT> gained 2.46 percent, its biggest percentage gain since April 24.

ITC fell 2.7 percent on concerns that India may follow the rest of the world in adopting anti-smoking regulations.

ITC's core tobacco business is getting squeezed and it is venturing into dairy products, drinks and perhaps even healthy breakfast foods to try to expand its money-losing consumer products business.

Shares in State Bank of India , rose 1.3 percent after the bank slashed its deposit rates between 50-100 basis points across maturities, effective Friday.

ICICI Bank ended up 1.9 percent, while Axis Bank gained 2 percent, after falling on Wednesday.

Macquarie has upgraded Yes Bank to 'outperform' from 'neutral' and raised its target price to 415 rupees from 380 rupees, saying current levels "offers good opportunity to accumulate.

Shares in Yes Bank ended 0.8 percent higher.

Shares in Motherson Sumi Systems Ltd rose 2.8 percent after CLSA initiated coverage on the stock with a 'buy' rating and a target price of 235 rupees, saying it expects the company's earnings to double over FY12-14 as its Peguform acquisition begins to contribute.

Mahindra & Mahindra Ltd , India's biggest utility vehicle manufacturer, will finalise its Russia plan in 4-6 months and is in talks with Russian distributors, Pawan Goenka, president of its automotive and farm equipment sectors, said on Thursday.

Shares in Mahindra and Mahindra rose 0.5 percent.

Hero MotoCorp Ltd , India's largest motorcycle maker, has signed an agreement with a European design and technology partner, Managing Director Pawan Munjal said, its third partner since its split from Japan's Honda Motor Co <7267.T>.

Shares in Hero MotoCorp fell 1 percent.