The Hindu Business Line : Broad buying helps Sensex

The markets opened on a strong note ahead of the Budget and remained buoyant. Indications from the Economic Survey that the growth momentum is likely to continue coupled with optimism from the Finance Minister spurted the markets to higher levels.

There was a widespread buying interest across sectors that helped markets reach record highs. The undertone in the market remained largely positive. This was reflected in the advances to decline ratio of 1.3 that was tilted strongly in favour of advancing stocks.

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On the National Stock Exchange, the market capitalisation crossed Rs 25-lakh crore- mark for the first time. The market capitalisation has increased by about Rs 36,000 crore over the past two weeks.

Sector focus

Stocks from the construction and infrastructure sectors caught investors' fancy on expectation that the Budget will boost spending on infrastructure. Larsen and Toubro climbed by 0.8 per cent. This apart, buoyed by news flows about fresh orders, stocks of Madhucon Projects and Punj Lloyd advanced by three and 1.5 per cent respectively.

Capital goods sector also hogged the limelight with stocks such as BHEL, ABB, Greaves Cotton, Areva, Elgi Equipment and Praj Industries rocking the markets.

IT sector also attracted heightened market interest. Infosys and Satyam netted off handsome gains following reports of expansion plans by the IT majors. i-Gate Global, Geometric Software, i-flex Solutions and Allsec Technologies recorded smart gains among the second-rung IT stocks.

Select stocks in automobiles sector witnessed a strong buying support. Expectation that the Budget might spell out tax-cuts for automakers had a positive impact on their stocks. Maruti, M&M and Tata Motors closed on a firm note among others.

Spurred by the Finance Minister's comment that India's economic growth outlook is "quite bright" and assurance that the Central Bank will meet the demand for loans, banking sector stocks marched ahead.

Renewed buying interest across the counters of Canara Bank, Punjab National Bank, SBI, Oriental Bank and Allahabad Bank helped the stocks register respectable gains. UTI Bank added 3.3 per cent as it finished at Rs 330.9.

Cement stocks appeared in a firm footing. Gujarat Ambuja Cements led cement makers higher on optimism that growing demand will boost prices for the commodity.

Grasim, ACC, Mysore Cements, Shree Cement and Prism Cement also smartly bucked the trend.

Pharmaceutical and consumer goods sectors sported a bearish outlook.

Oil and energy stocks also failed to fuel market sentiment, as investors remained cautious ahead of the budget. Reliance, Indian Oil and Chennai Petroleum ended in the red.

Event-specific action

GVK Power & Infrastructure a power producer, rose 1.8 per cent on its trading debut .The shares closed at Rs 315.6 against the offer price of Rs 310.

Punjab Chemicals moved up by over two per cent following announcement that the company had acquired 100 per cent stake in IA & IC Chemical.

Finolex Industries gained 0.8 per cent at its close of Rs 76.1. Earlier, the company announced that it had commenced commercial production of PVC resin at its Ratnagiri plant.