The Hindu Business Line : 12,000: In double quick time

The BSE Sensex crossed 12,000 points on Thursday, covering the last 1,000 points in a mere 15 trading sessions, its quickest time ever for that distance.

Reports of oil discovery by index heavyweight Reliance Industries Ltd (RIL), good earnings announcements from IT players and demand for metal stocks given rising metal prices, propelled indices to record highs.

Standard & Poor's upgrading India's credit rating from stable to positive, also influenced sentiment, dealers said.

The benchmark BSE-30 Sensex closed at 12,039.55 on Thursday, up 143.57 points (or 1.21 per cent).

The NSE's S&P CNX Nifty index went up by 37.65 points (or 1.06 per cent) to 3573.50.

RIL led the rally and almost touched the Rs 1,000-per share level (at Rs 999.95) following huge fund buying on the back of reports that the company had struck a one billion barrel-oil well in the Krishna-Godavari basin.

RIL closed at Rs 994.90 (up Rs 74.05 from Wednesday); trading higher now than its pre-demerger rates.

"Funds that were are not owning stocks like Reliance and Infosys, were caught on the wrong foot. Now, they are rushing in to own these stocks," said Mr S.P. Jain, Director, Networth Stock Broking.

Bullish on positive news

Though rising oil prices may be cause for concern, Mr Jain said the market was likely to see positive news flows that could keep it bullish.

In the tech sector, for instance, several global outsourcing contracts would be up for renewal in the near future and Indian companies were expected to clinch a big portion, he said.

Noted in the rally's current phase was money moving into large cap stocks, while mid-cap and small caps remained less attractive. Mr Manish Kanchan, CEO, Ambit Capital, said the earnings story of Indian companies looked sustainable for the next two quarters and this was attracting more money into large cap stocks.

"There is a shift to large cap stocks like Reliance. Metals is another sector that is attracting buyer interest," he said.

That the bullish trend was despite foreign institutional investors (FIIs) being net sellers this month showed the resilience of the Indian stock market, Mr Kanchan said.

After pumping in over $4 billion in the first three months of this calendar, FIIs had turned net sellers to the tune of over $400 million, in April.

Notable gainers on Thursday included Tata Steel (up 5.76 per cent at Rs 644.05), Hindalco (up 5.56 per cent at Rs 215.55), ONGC (up 1.6 per cent at Rs 1349.25) and Tata Motors (up by 3.07 per cent to Rs 952.30).

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