BSE Sensex climbs past 19,300, NSE Nifty tops 5850; auto, capital goods gain

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The S&P BSE Sensex extended intraday gains and was at day’s high after the status quo of the Reserve Bank of India on interest rates failed to dampen sentiment.

“This is a prudent decision by RBI to pause on rates given the pressure on the rupee because of recent FII outflows from the debt markets. Any further reduction in interest rate deferential between Indian and US/ German yields (referred as safe haven) can trigger further outflows in the debt markets,” said Yadnesh Chavan, Head of Fixed Income, Mirae Asset Global Investments (India).

“This will result in weak rupee and can again put pressure on inflation and fiscal situation. In overall, this monetary policy was all about further guidance from the Reserve Bank of India. The tone of the policy is mildly hawkish as RBI has significantly increased the weightages of retail/food inflation given the pre-election government spending and balance of payment and currency considering external risks,” Chavan added.

According to analysts, with the RBI policy event out of the way, the Indian markets are likely to take cues from the US Federal Reserve’s comments on Quantitative Easing.

At close the 30-share index was at 19,325.87, up 147.94 points or 0.77 per cent. It touched a high of 19,335 and a low of 19,084.68 in trade today.

The Nifty was at 5,850.05, up 41.65 points or 0.72 per cent. It touched a high of 5,854.90 and a low of 5,770.25 in trade today.

Mahindra & Mahindra (4.43 per cent),  BHEL (3.37 per cent)  Sun Pharmaceuticals (2.84 per cent), Bajaj Auto (2.50 per cent) and  Bharti Airtel (2.53 per cent) were among the top Sensex gainers.

Shares of M&M moved higher after its automotive component arm Mahindra Systech picked up 13.5 per cent stake in European auto components major CIE Automotive for around euro 96.24 million (Rs 740 crore) through its subsidiaries.

Hindalco (1.54 per cent), Sterlite Industries (1.33 per cent), Dr Reddy’s Laboratories (1.22 per cent), GAIL (0.70 per cent) and Coal India (0.47 per cent) were among the losers.

The foreign institutional investors sold shares worth Rs 305.68 crore and domestic institutional investors bought equities worth Rs 910.62 crore on Friday as per the provisional data from the National Stock Exchange.

The European markets have opened with a gap-up ahead of the US Federal Reserve meet. The FTSE 100 was up 0.70 per cent, the CAC 40 was 1.26 per cent higher and the DAX gained 1.30 per cent.

Source : The Economic Times.

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