Key Indian equity index stages 500-point recovery (Roundup)

Recovering from a three-day fall, a key Indian equity market index ended over 500 points up on Friday, with sentiments lifted by government assurances that it will seek advice from an expert panel on the disputed issue of minimum alternate tax on foreign funds.

After a steady rise since the opening bell, the sensitive index (Sensex) of the Bombay Stock Exchange (BSE) closed on Friday at 27,105.39 points -- up 506.28 points, or 1.90 percent. At the National Stock Exchange, the Nifty closed at 8,191.50 points, up 134.20 points or 1.67 percent.

The recovery was also broadbased with as many as 1,860 shares, out of the 2,811 that traded on Monday on the Mumbai bourse, ending in the positive territory. Also, while 822 lost some ground, 129 others remained unchanged.

"Auto stocks, private sector banks and index heavyweights led rally as key benchmark indices surged on the last trading session of the week," said HDFC Securities, adding that a decline in crude prices and rupee's recovery against the dollar also helped boost sentiments.

The gainer within the 30-share Sensex was Tata Motors, up 5.18 percent at Rs.513.50; followed by ICICI Bank, up 4.09 percent at Rs.316.95; Cipla, up 4.03 percent at Rs.653.70; Hindalco, up 3.5 percent at Rs.139.00; and Hindustan Unilever, up 3.34 percent at Rs.894.60.

The top loser within the group was Hero Motor, down 2.23 percent at Rs.2,301.55; ONGC, down 0.96 percent at Rs.315.65; Tata Consultancy, down 0.50 percent at Rs.2,530.70; Tata Steel, down 0.22 percent at Rs.366.20; and NTPC, down 0.18 percent at Rs.142.05.

Among the other indices, the BSE 100 was up 1.73 percent and the BSE 200 was up 1.72 percent. The BSE mid-cap and the BSE small cap also gained 1.70 percent each. This apart, among the 12 sector-specific indices of the exchange, only one -- consumer durables -- lost ground.

The mood was evidently lifted by the government assurances to remedy its taxation policy.

Finance Minister Arun Jaitley on Thursday said in parliament the ministry has referred the issue of minimum alternate tax dispute with foreign funds to a panel headed by Law Commission chairman A.P. Shah, and has requested early suggestions.

"Uptrend was also helped by the comments from global rating agencies like Fitch and Moody's that said today on Friday that India's credit ratings will remain unaffected by the recent surge in capital outflows," said brokerage Sharekhan.

The reason: India's external balances, relative to peers, was strong and adequate.

Globally, US markets had also ended in the green on Thursday, even as the UK market led the other bourses in Europe to gain ground as Prime Minister David Cameron's party was set to return to power for another five years. Even closer home, the Asian markets rallied on Friday.

On Thursday, the Sensex had fallen for the third straight day, by 118.26 points, or 0.44 percent, to a six-and-half month low, as prevailing uncertainties over tax policy, rising crude oil prices and falling value of the rupee that touched a 20-month low, continued to rock the mood.

In the process, the Sensex closed at its lowest level since October 21 last year and the Nifty at its lowest level since December 17. On Wednesday, the Sensex crashed 722.77 points, or 2.63 percent, while the day before it fell 50.45 points, or 0.18 percent.