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| Sensex rises for fourth day in a row, up 59 points |
| Bloomberg / Aug 26, 2009, 00:30 IST |
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India’s stock benchmark rose after the weather bureau said monsoon rainfall may improve over key farming regions, easing concerns that the country’s economic growth prospects may be hurt.
ITC, a cigarette maker betting on rural consumers for growth, rose 0.2 per cent after the Meteorological Department said rain would strengthen over Madhya Pradesh from Wednesday. Tata Motors jumped to the highest in 14 months after its chairman said he sees recovery for the company in India and it was upgraded to “outperform” from “neutral” at Credit Suisse Group AG.
The Bombay Stock Exchange’s Sensitive Index, or Sensex, rose 59.72, or 0.4 per cent, to 15,688.47. This was the fourth day in a row when the index closed in the green. The gauge had earlier declined as much as 1.3 per cent. The S&P CNX Nifty Index on the National Stock Exchange gained 0.4 per cent to 4,659.35. The BSE 200 Index advanced 0.4 per cent to 1,917.02.
“Investors are realising the effect of the poor monsoon would not be as bad as thought earlier,” said A N Sridhar, a fund manager at Sahara Asset Management in Mumbai. “The momentum is back.”
ITC climbed 0.2 per cent to Rs 240.5. Tata Motors, maker of the cheapest car in the world, the Nano, jumped 6.9 per cent to Rs 490.35. Reliance Industries, India’s most valuable company, gained 2.6 per cent to Rs 2,025.65. NTPC, India’s biggest utility, rose 1.9 per cent to Rs 210.7.
Rain revive
India’s monsoon, the main source of irrigation for the nation’s 235 million farmers, will strengthen over Madhya Pradesh, the biggest soybean growing area, from Wednesday, the weather bureau said. Rainfall will increase over Maharashtra and Gujarat, the biggest cotton growers, from August 27, the India Meteorological Department said Tuesday.
Kotak Securities on August 7 cut India’s GDP forecast for the year to March to 4.8 per cent from 6.5 per cent, while Goldman Sachs Group said “lower rainfall projections will likely lead to negative agricultural growth” after rain that had dropped as much as 29 per cent below the average and had sparked droughts in a third of the nation’s 626 districts threatened farm output.
Bajaj Hindusthan, India’s biggest sugar mill, declined 3.5 per cent to Rs 170.85. Balrampur Chini Mills, the country’s No. 2 mill operator, retreated 3 per cent to Rs 113, Shree Renuka Sugars, the nation’s largest refiner, declined 2.3 per cent to Rs 180.4.
Sugar limits
The government imposed limits on how much of the commodity users can hold. Consumers of more than one tonne of sugar a month should not stockpile more than 15-days worth of the sweetener, the food ministry said yesterday after the stock market closed. “This will definitely impact the flow of sugar for producers and that’s the reason the stocks are down,” said Anup Ranadive, a Mumbai-based analyst at Tower Capital & Securities.
Overseas funds bought a net Rs 546 crore ($112.1 million) of Indian stocks on August 21, the Securities and Exchange Board of India said on its Web site. The funds have bought Rs 36,010 crore of Indian stocks this year to date, compared with record net sales of Rs 53,000 crore for the whole of 2008.
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