Bulls salute reforms, Sensex scales 19,000

Re strengthens to below 52/$ amid positive sentiment

With the government going full throttle on big-bang reforms, bulls are having a party on Dalal Street.

The Bombay Stock Exchange (BSE) benchmark, Sensex, reclaimed the 19,000-mark on Thursday after a gap of 17 months, as investors hoped the government would unveil more reforms. And, they were not disappointed.

After the stock market hours, the Union Cabinet gave its nod to 49 per cent foreign direct investment (FDI) in the insurance and pension sectors. It also cleared the new Companies Bill.

Top five Sensex gainers from 18,000 to 19,000
(BSE price in Rs)	October 4	% change*
BHEL	266.05	32.40
SBI	2,344.80	26.24
JSPL	416.75	24.85
L&T	1,633.10	19.24
ICICI Bank	1,083.70	14.62
*Change over Sept 11, 2012                 Data compiled by BS Research Bureau

The 30-stock Sensex rose one per cent, or 188.46 points, to close at 19,058.15, its highest close since July 7, 2011.

Driven by strong foreign inflows and reform optimism, the Sensex has managed to move from 18,000 to 19,000 in just 15 trading sessions.

According to provisional data, foreign investors pumped in Rs 945 crore into Indian stocks on Thursday, taking the year-till-date tally to Rs 84,824 crore ($16.3 billion). At the National Stock Exchange (NSE), the 50-stock Nifty index gained 0.98 per cent, or 56.35 points, to 5,787.60. The key stock indices have gained over 10 per cent each since the government started its reform drive on September 6.

Thanks to strong foreign fund flows, the rupee appreciated further against the US dollar on Thursday to close at a five-and-a-half-month high. The Indian currency closed at 51.75 a dollar, 42 paise or 0.81 per cent higher than its previous close.

“The market has been going up on the back of reform initiatives taken by the government. It will continue to do if the centre keeps backing reforms,” said Vikas Khemani, president and head-institutional equities, Edelweiss. “We are in the middle of a reform festival. We will see more reform measures going ahead,” said Saurabh Mukherjea, head of equities, Ambit Capital.