The Hindu Business Line : North-bound journey resumes with vigour

Buoyed by relentless buying by FIIs along with continued support from domestic funds, benchmark indices appeared unstoppable as they went on to scale yet another high.

Broad-based rally led by index heavyweights helped the benchmark Sensex reach an intra-day high of 8294.2.

Despite a number of brokerage houses, market watchers and analysts speaking about the Indian markets being overvalued and in spite of huge uncertainty about the direction of markets, the sentiment continued to be overtly bullish.

Out of the 30 stocks constituting the BSE 30, 26 advanced while three of them shed value. Fresh buying interest in the stock of Reliance negated the weak trend witnessed on Wednesday. It closed the day at Rs 760.8, notching a gain of 2.7 per cent. ITC, Reliance Energy and Bharti Televentures, which remained subdued on Wednesday's trading, made a smart comeback and were instrumental in lifting the indices.

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Other bigwigs that witnessed sharp rise were Gujarat Ambuja, Grasim, Maruti, HLL, Tata Steel, ACC, TCS and Hindalco. Mirroring the gains in these stocks, the Sensex closed the day at 8283.8, up by 94.3 points from its previous close.

Following its counterpart, the broader Nifty also marched ahead on the back of strong buying interest — both from institutional and retail investors. After kissing the 2500- mark on Tuesday, it went on a bumpy ride as it reached a record high of 2527.5 during Thursday's trade, before closing at 2523.9. Amongst the biggest gainers from the Nifty were Tata Chemicals, VSNL and HCL Technologies. Usha Martin, Reliance Capital and Jindal Stainless were among the active stocks, which recorded a sharp spurt in trading volumes.

The bullish sentiment was more pronounced in the mid-cap and small-cap space, which witnessed widespread action. There were heavy bouts of buying activity across the counters of India Infoline, Philips Carbon Black, Torrent Cables, Cyber Media, Madhucon Projects and GMR Industries. Stocks of GTL, Hexaware, Indiabulls, Shree Cements, Geometric Software, Gujarat Alkalies and Berger Paints also moved up sharply.

It was a good day for most stocks in the FMCG space. Some of them that netted handsome gains were Ruchi Soya, McDowell, Liberty Shoes, Marico, Dabur India and Tata Coffee.

Select frontline stocks in IT sector such as TCS, Satyam and Wipro participated in the rally. However, Igate Global, Flextronics and NIIT ended on a weak note.

Metals stocks put up a smart show on the back of strong buying support. Stocks of SAL Steel, Southern Iron and Steel, Monnet Ispat and Tata Sponge Iron were buzzing with activity.

There has been a sharp spurt in trading volumes across the counters of these stocks, which has added to buoyancy.

Punjab Tractors, MRF, Maharashtra Scooters, Amtek Auto, Escorts and Ashok Leyland sported significant gains. Bajaj Auto, which has gained over 20 per cent in the last one month, cooled off, while its competitor, Hero Honda also lost steam.

Banking sector stocks were characterised by lacklustre trading as most of them ended on a flat note. Allahabad Bank, Oriental Bank, HDFC Bank, Canara Bank and ICICI Bank ended with marginal gains.

Stock-specific action:

Praj Industries jumped by about 5 per cent on reports that the maker of equipment for sugar mills and distilleries received an Rs 36-crore order to build a plant for a Turkish company.

Provogue India gained 4.5 per cent after the domestic fabric exporter said that it plans to enter the mall management services business and invest in new shopping malls. It closed the day at Rs 195.5.

Buoyed by the reports that it plans to buy a US-based fruit and herbal tea brand, Tata Tea rose by 1.3 per cent.

Jindal Saw added 3.3 per cent to its stock after the steel pipes maker said that it raised $ 65 million of GDRs to fund its expansion.

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