Markets snap 3-day losing streak, Sensex up 91 points

The Bombay Stock Exchange benchmark index Sensex today recovered from its six-week lows, gaining 91 points on firm global cues and on emergence of brisk buying by funds in key sectors like metals and PSUs, among others.

The 30-share bellwether Sensex initially touched a high of 16,738.12 but pared some of those gains to end at 16,692 points, posting a net rise of 90.80 points or 0.55 per cent from its previous close of 16,601.20. The Sensex had shed 312 points or 1.84 per cent in last three sessions alone.

The market snapped its three-day losing streak on renewed demand in key sectors like metals, PSUs led by banks, realty, and telecom counters on the back of news of higher advance tax payments by leading corporates,helping the markets to rebound. The rally was still limited to a handful of stocks like metal heavy weight Tata Steel and Hindalco, realty leader DLF and telco Bharti Airtel, which all gained close to 4 percent each.

Similarly, the wide-based National Stock Exchange index Nifty 50 also rose 33.25 points to close at 4,985.85 after touching an intra-day high of 4,997.30.

However, marketmen are not very enthused about this and are cautious saying this renewed interest is temporary and driven by the massive fall in the previous days, especially on the metals counters.

Ashika Stock Brokers research head Paras Bothra said, “today’s rally was purely a reflection of the global markets which were holding up.

“Yesterday the metal stocks were hammered down quite a lot. This brought in a kind of rebound in the sector today. The rally is basically a one-day kind of an activity, devoid of any fundamental reason.”

In Asia, most of the indices ended in the green following overnight jump on the Wall Street. Hang Seng, Nikkei, Kospi, Strait Times and Taiwan Index rose by 0.60 per cent to 1.91 per cent, while Shanghai fell 2.32 per cent.

The Dow Jones Industrial Average and the Nasdaq firmed up 85.25 points and 25.97 points yesterday, respectively. Similarly, following the overnight rally on the American bourses, the European markets also opened higher today in morning deals. The FTSE was up 0.54 per cent, CAC by 0.45 per cent and the DAX by 0.28 per cent.

The metal stocks were back in demand following reports of the base-metal prices shooting in London, on expectations of a pick up in demand driven by the global recovery. The telecom counters gained smartly following Government statement that the spectrum auction would go ahead as planned on January 14.

Reflecting the rally in sectoral stocks, the BSE-Metal index spurted by 457.75 points or 2.87 per cent, BSE-PSU index by 144.40 points or 1.59 per cent, BSE-Realty by 55.38 points or 1.51 per cent, Bankex by 110.62 points or 1.16 per cent and the BSE-Power by 29.79 points or 1.00 per cent.

Among the top gainers from the Sensex pack, Tata Steel flared up 3.97 per cent, Bharti Airtel by 3.84 per cent, Hindalco by 3.65 per cent, NTPC by 3.27 per cent, ICICI Bank by 1.95 per cent, RCom by 1.57 per cent, DLF by 1.47 per cent and Hero Honda by 1.20 per cent.

Against this foreign institutional investors sold shares worth Rs 291.94 crore yesterday as per provisional figures while domestic institutional investors bought stocks to the tune of Rs 353.83 crore.

Among the sectoral losers were the BSE-Tech index which shed 0.35 per cent followed by the consumer care index that lost 0.17 per cent and also the auto counter.

The Sensex losers pack was led by the cement major ACC which declined by 1.92 per cent, energy major ONGC by 1.28 per cent, and the software major TCS by 1.19 per cent, auto major M&M by 1.04 per cent and JP Associates which declined by 0.98 per cent.

It can be noted that today the entire IT counter lost steam today following two-weeks of rally. The overall market breadth turned positive as 1,694 counters ended with gains against 1,107 that ended with minor losses on the BSE.

The trading volume declined further to Rs 3,640.08 crore from Rs 3,878.06 crore on Monday, reflecting the weak sentiment prevailing in the market that’s awaiting a long holiday.

Tata Steel topped the list of highest traded securities with the turnover of Rs 148.77 crore followed by Zandu Pharma (Rs 148.32 crore), Suzlon Energy (Rs 80.93 crore), RIL (Rs 79.01 crore) and Aban Offshore (Rs 73.51 crore).