Sensex News

WEEKLY REVIEW: relief rally lifts Sensex

The long bear phase seems to have ended as the stock markets witnessed an impressive relief rally lifting the benchmark Sensex by 9.0 per cent in the week under review amid a host of negative factors. Both the key indices, Sensex and Nifty, registered their second highest point-wise gains in a week on the back of hectic short covering as the derivatives contract concluded on March 27.

Foreign Institutional Investors (FIIs) too were net buyers in the Cash during the week. The buying spree was so strong on March 25 that the Bombay Stock Exchange barometer logged its second biggest gain of 928.09 points.

Bourses drew support from reports of a surprise increase in sales of US pre-owned housing data as well as news that JP Morgan raised the open offer for the ailing US investment bank Bear Stearns to $10 per share from its earlier offer of $2 per share.

The market, however, were under pressure during mid-week due to weak global cues arising out of lingering fears about the US credit crisis and poor US economic data.

The rising inflation, which remained well above the 5.0 per cent caution level of the Reserve Bank also caused concerns among investors. The inflation touched 13-month high of 6.68 per cent for the week ended March 15.

At the weekend March 29, the Bombay Stock Exchange 30-share Sensex gyrated wildly in a range of 16,452.08 and 15,056.09 before ending the week at 16,371.29, a sharp rise of 1,376.46 points or 9.18 per cent over previous weekend.

The 50-share S&P CNX NIFTY of the National Stock Exchange also recovered sharply by 368.05 points or 8.05 per cent to end the week at 4,942 from 4,573.95 last weekend.

The rally was across the board and helped all the sectoral indices to gain 4.0 to 13.0 per cent over the week. Even IT counters found heavy-buying support despite the rupee's appreciation on the back of capital inflows and higher inflation.

Taking a cue from a smart rise in advance tax payment, analysts expected fairly good increase in the fourth quarter corporate earnings.

The country's largest commercial vehicle producer, Tata Motors, eased by 0.69 per cent in the week on concerns over the funding of the acquisition of luxury brands Jaguar and Land Rover from Ford Motors for $2.3 billion.

The trading volume during the week on the BSE was Rs 30,564 core and Rs 67,227 crore on the NSE. The broad-based BSE-100 index flared up by 726.85 points to finish the week at 8,604.38 from last weekend's close of 7,877.53.

The BSE-200 index and the Dollex-200 were quoted sharply higher at 2,012.69 and 840.77 at the weekend compared to their previous weekend's close of 1,843.03 and 757.88 respectively.

The BSE-500 index also shot up by 542.66 points to end the week at 6,395.47 from previous weekend's close of 5,852.81 and the Dollex-30 ended up at 3,372.43 from 3,040.66.

On the NSE, the S&P CNX Defty recouped smartly by 378.65 points to close the week at 4,295.30 from last weekend's close of 3,916.65 and the Nifty Junior also spurted by 865.85 points to conclude the week at 8,297.00 from 7,431.15 last weekend.