Mkts bounce back on global cues, FII buying & monsoon

Mkts bounce back on global cues, FII buying & monsoon
The Financial Express, July 15, 2009, Page 4

fe Bureau, Mumbai

Indian equity indices surged ahead on Tuesday, after a sustained buying was seen by the foreign institutional investors (FII) coupled with monsoon finally arriving in several parts of the country. Additionally, strong cues from the Asian as well as European markets wherein all exchanges closed in the green, led the domestic markets to close above the dotted line. The 30-share Sensex of Bombay Stock Exchange (BSE) added 453.38 points or 3.38% to close the day at 13,853.70 points.

The broader S&P CNX Nifty of National Stock Exchange (NSE) ended higher by 137.35 points or 3.46% to 4,111.40 points.

Despite domestic markets going up on Tuesday, dealers in the market sense that, in the coming days markets might remain volatile due to lack of cues from the national as well as international front.

Ambareesh Baliga, vice president at Karvy stock broking said, “After witnessing a downward rally in the last week, there was bound to witness a bounce-back. However, I don’t think that, this upward rally will continue in the coming days.”

Domestic markets started the day on the positive terrain backed by encouraging note from the US markets and traded in green throughout the trading session, to close the day with handsome gains.

An analyst from a leading broking firm said, “Reports from the meteorological department forecasting that the monsoons will get stronger in coming days boosted the sentiments of the markets. Moreover, statements from the finance minister that the recovery of our economy is on the right track coupled with his belief that the huge spending plan of the central government will have a positive impact on the economy has also had a positive impact on the markets.”

As per the provisional figures furnished by BSE, FII were net buyers to the tune of Rs 87.23 crores while domestic institutional investors (DII) were net buyers at Rs 200.29 crores. All the sectors in the BSE Sectoral indices closed the day in green, with realty and metal being the top performers of the day. Baliga further added, “We assume that, Nifty is likely to remain in the range of 3,850 to 4,150 in the coming days. I don’t think Nifty will breach 4,150 mark as in the coming days we might not witness any major announcement from the government and on the monsoon front we have to wait for another 10-15 days to have a normal monsoon in the country.”

The breadth of the market remained strong as out of 2,639 stocks traded on BSE, 1,956 stocks advanced, 602 stocks declined while remaining 81 stocks remained unchanged. In Sensex, 29 stocks closed the day in green and one stock closed in red. Dealers further added that, domestic markets would also be triggered by the quarter earnings season and global cues.