The Hindu Business Line : Markets bounce back; Sensex up 118 points

BUCKING the bearishness of the last few days, markets rallied back on Thursday and the indices made up for some of the earlier losses. The BSE Sensex gained 118.32 points and closed at 6221.06, comfortably over the 6200 mark. Nifty also appreciated by 2.14 per cent, gaining 40.95 points, and closed at 1954.55.

Brokers attribute today's rally to value buying as the markets had dropped to considerably lower levels. The confusion over the possible cap on foreign institutional investors' inflows and taxing their investments in India was cleared well before the markets opened. The Finance Minister, Mr. P Chidambaram, firmly asserted on Wednesday that there were no plans to cap or tax FIIs. The RBI Governor, Dr Y.V. Reddy, also clarified subsequent to his initial statement that the effectiveness of these measures could be arguable and hence undesirable.

Stock markets went into trade with the confidence that no such measures would be taken. Buying in frontline stocks and index heavyweights buoyed the market.

The market breadth was positive today with 1,774 shares advancing and 573 declining in BSE. At NSE, 716 scrips advanced while 91 declined.

Though trading today was broad based, cement and banking stocks were the market favourites. Shares of Gujarat Ambuja gained Rs 24.45 (6.10 per cent) to close at Rs 425.15 and ACC netted gains of Rs 17.35 (5.20 per cent) and closed at Rs 350.80.

BSE's banking index, Bankex, appreciated by 4.03 per cent with Bank of India, UCO Bank and Andhra Bank leading from the front. Punjab National Bank, Oriental Bank and HDFC Bank also posted smart gains.

Technology stocks were back in favour today. Impressive results posted by TCS helped the sector. Backed by huge volumes, the TCS scrip touched an intra-day high of Rs 1,338.70, though it ended trade marginally in the red at Rs 1,292.90.

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