The BSE Sensex gained for a fourth consecutive session on Tuesday as investors focused on March-quarter earnings, with Anil Ambani group firms surging after a pact with a unit of Reliance Industries sparked hopes of wider co-operation between the two groups.
Shares in companies controlled by Anil Ambani rose sharply in late trade after group firm Reliance Communications entered into a pact with a unit of brother Mukesh Ambani’s Reliance Industries for sharing the company’s optic fibre network.
Reliance Communications ended 11.22 percent higher, while Reliance Infrastructure gained 3.8 percent.
Reliance Industries ended nearly 2 percent higher.
“It’s a good directional call taken by both Ambani groups leveraging each other’s requirements and strengths and working together,” said Deven Choksey, managing director at KR Choksey Securities.
“This may help the short-covering rally in the market in April but sustenance depends on how the government acts on reforms,” he added.
Gains were also boosted after European shares extended gains when new data showed the region’s factory activity was no worse than originally estimated in March.
The government has reiterated its commitment to reforms but investors remain worried about potential political instability after a key ally pulled away from the ruling coalition last month.
The BSE Sensex ended up 0.93 percent, or 176.20 points, at 19040.95, its highest close in almost two-and-a-half weeks. It has gained 1 percent over the previous three sessions, closing above the psychological 19,000 level.
The broader Nifty rose 0.77 percent, or 43.70 points, to 5,748.10.
Select blue-chips also rose on hopes of good March-quarter earnings.
RIL’s shrinking valuation premium to peers may be helpful in allowing the shares to track market performance in the near term, Barclays said in a note, adding that it expects Reliance to report a net profit of 55.65 billion rupees in Jan-March, up 1 percent-on-quarter.
Shares in Sun Pharmaceutical Industries gained 4.76 percent after Nomura said URL Pharma, the unit it acquired from Takeda Pharmaceutical, has significantly raised prices of a drug, dealers said.
Larsen & Toubro gained 1.9 percent after the company said its construction division secured new orders valued over 37 billion rupees in March.
Maruti Suzuki rose 1.9 percent after reporting a lower-than-expected fall in March vehicle sales.
However, Bajaj Auto shares lost 1.61 percent after reporting a 10 percent fall in March vehicle sales.
Copyright Thomson Reuters 2013