Financial Daily from THE HINDU group of publications
Wednesday, Aug 27, 2003
Markets - Stock Markets
As investors put fears behind Markets recoup, Sensex gains 147
Mumbai , Aug. 26
THE stock markets dampened by Monday's twin bomb explosions in Mumbai , bounced back confidently today as investors returned to make purchases.
Brushing aside fears of violence, they helped wipe out the previous day's losses. The Finance Minister, Mr Jaswant Singh's statement that the fundamentals of the economy were strong, boosted the sentiment alongside, according to brokers.
The city's bullion market opened for a short while, but trading was halted later due to the visits of the Deputy Prime Minister, Mr L.K. Advani, and Ms Sonia Gandhi, Congress Chief and Leader of the Opposition. The hub of the bullion market lay in the area where one of the bombs exploded.
Parts of Zaveri Bazaar were cordoned off to allow police officers, Government officials and experts to continue their investigation work.
Mr Advani and Ms Gandhi visited the explosion sites and some of the hospitals where the injured were being treated.
Speaking to the press at Zaveri Bazaar, Mr Advani said the offenders responsible for the explosions will be arrested shortly. He blamed Pakistan for the rise in terrorist activities.
At the bourses, shares commenced their upturn soon after trading commenced. Gains were witnessed almost across the board as investors rushed to buy after Monday's sell off.
Domestic institutions led by UTI and LIC took the first call in trading. As the day progressed, buying from FIIs and retail investors was also seen.
Old economy - steel, cement and automobile - stocks were back in the limelight on renewed buying. While heavyweights contributed to the recovery of the market, technology stocks were also on the buyer's list.
The BSE Sensex closed 147.66 points (3.69 per cent) higher at 4,152.29 and NSE's S&P CNX Nifty closed at 1,318.20, up 48.91 points (3.71 per cent). The rise in mid-cap and small cap stocks was much higher. Broader indices such as S&P CNX Junior Nifty (up 4.44 per cent), CNX Mid-Cap 200 (up 4.32 per cent), BSE 200 (up 4.34 per cent) and BSE 500 (up 4.44 per cent) gained more than the key indices.
Dealers said the rebound in stock prices indicates bullish sentiment. Further, the active buying from FIIs showed that their investment decisions have not been affected by the bomb blasts.
They said, the market is likely to remain volatile over the next couple of days due to the expiry of August derivatives contracts on Thursday. Volume in today's trading was good, albeit lower than yesterday's.
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