The Hindu Business Line : Sensex rallies on strong buying

The markets appear to have disregarded the latest inflation number of 8.33 per cent. The fact that industrial production figures showed a near-eight per cent growth in the first four months of the fiscal could have breathed positive vibes into the markets.

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On the back of strong buying in the index heavyweights, the BSE Sensex ended the trading session at 5370.05, about 72 points higher than the previous close.

The Nifty gained nearly 20 points to close at 1668.75. The rally was witnessed across the board with Steel, IT and FMCG stocks hogging the limelight.

The Sensex began on a positive note at about 5305 points. Sentiment remained enthusiastic throughout the trading session. Nine out of every ten stocks constituting the benchmark index advanced, reflecting the bullish sentiment of the market.

Key gainers of the day were the stocks of Cipla, Bharti Tele-Ventures, HDFC, Ranbaxy and Tata Steel. The stocks of Zee Telefilms and Hindalco figured on the losers list.

Midcap stocks, which have been the hot favourites of the stock markets in the past couple of months, appeared to lose steam on Friday. The broad-based CNX Midcap 200 registered a gain of only 0.74 per cent, lagging the 1.20 per cent return of the Nifty.

Stocks such as Blue Star, Blue Dart, Crompton Greaves, Lumax, Kothari Products, Tata Honeywell and Atlas Copco were prominent losers on Friday's trading.

Steel and IT stocks such as Tata Steel, SAIL, Sesa Goa, Satyam, Infosys, TCS, Polaris Software and Wipro gained smartly. FMCG stocks made a comeback after a long time on Friday. The stock of HLL gained Rs 2.35 to close at Rs 121. The stock has been gaining slowly but steadily over the past week. The stocks of Dabur, Colgate Palmolive and Nirma also gained.

Fertilizer stocks continue to be in the seat of action. The stocks of Nagarjuna Fertilisers, Chambal Fertilisers, Coromandel Fertilisers, Godavari Fertilisers, Oswal Chemicals and Fertilisers and SPIC witnessed heady activity. The stock of SPIC gained Rs 1.6 to close at Rs 13.25. This comes on the back of a jump in volumes from 5.1 lakh shares to 18.41 lakh shares.

Court verdicts appear to be closely followed by the stock markets, with the stocks of ITC and Zee Telefilms reacting instantaneously to court rulings. The stock of ITC built further on Thursday's gain, putting on another 2.40 per cent to close at Rs 1,105.75. The company won an appeal on an excise tax claim worth Rs 803 crore. The stock of Zee Telefilms, however, shed another per cent on Friday, even as the company prepares to file a fresh bid for the cricket telecast rights.

Two other stocks that figured prominently on Friday's trading were the stocks of Vardhman Spinning and Mahavir Spinning. The stock of Vardhman Spinning slumped by Rs 8 to Rs 207.2 on the back of news that the company is demerging its textile business which is to be merged with Mahavir Spinning.

On the same chord, the stock of Mahavir Spinning put on Rs 1.55 to close at Rs 212.70. Mahavir Spinning is expected to become the largest textile company in India, overtaking that of even Arvind Mills. The company is set to gain from lower interest costs and additional capacities. Vardhman Spinning would now focus completely on its fabric business.

A stock that saw considerable action on Friday was KEC International. The stock fell by Rs 1.1 to close at Rs 97.3. The stock saw a surge in volumes to 66.75 lakh shares from 5.71 lakh shares.

Other stocks that witnessed strong volumes include IDBI, Bank of Rajasthan, Union Bank, Welspun Gujarat, JK Synthetics and Kolar Biotech.