The Hindu Business Line : FOMC signal, weak crude propel Sensex by 165 points

The BSE Sensex moved sideways in the upper band for most part of the day before a late afternoon push made the index close higher with a gain of 165.13 points.

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The NSE's Nifty Index too closed the day in style with a gain of 50.25 points. Market breadth was positive with 1,372 advances and 1,138 declines on the BSE.

General Market Trend

The markets got a leg up in the morning from the Federal Open Market Committee's (FOMC) decision to keep the overnight bank lending rates unchanged at 5.25 per cent in the US. The dovish statement accompanying the decision reiterating that the US economy was slowing also helped to assuage the sentiment in equity markets world-wide.

Asian markets recovered from the red to close on a positive note.

Crude continued to slide back giving the markets another reason to smile. Nymex light crude for October delivery touched a low of $60 on Wednesday.

FIIs were net buyers to the tune of Rs 235 crore on Thursday, according to a provisional data on the NSE.

A lot of action seems to be taking place in the futures and options segment of the market. The last hour spurt in the prices can be attributed solely to the short covering in the derivatives segment.

The Nifty September futures were at a premium to their spot prices for most part of the trading day.

Mid-cap and small-cap stocks were relatively subdued on Wednesday. The BSE mid-cap index gained 0.65 per cent while the BSE small-cap index gained only 0.61 per cent.

BHEL led the rally in the markets right from the morning, finally closing with a gain of 2.76 per cent. The stock was spurred on by the news that it had bagged a Rs1,224 crore contract for 500 MW thermal power expansion project in Uttar Pradesh.

ONGC closed on a strong note, higher by 2.05 per cent buoyed by the news that ONGC Videsh's joint venture company with a subsidiary of Sinopec International Petroleum Exploration and Production Corporation had acquired Omimex de Colombia from a Texas based company called Omimex Resources.

Sector Focus

Interest revived in the banking sector on Thursday as Oriental Bank of Commerce, Dena Bank, Federal Bank, Canara Bank and Kotak Bank notched up gains between 3 per cent and 7 per cent.

Automobile stocks revved up on expectation that lower crude prices and the onset of the festive season will push up the sales in the months ahead.

Bajaj Auto and Maruti Udyog were prominent gainers on the Sensex. Infotech shares once again enjoyed a strong session due to a smart rally in the NASDAQ overnight.

TCS gained 2.44 per cent, Infosys gained 0.58 per cent, Satyam gained 1.87 per cent and Wipro gained 1.06 per cent. HLL closed higher by 3.38 per cent as some late afternoon buying pushed the stock's price higher.

Prominent gainers among the mid-cap and small-cap stocks on Thursday were Rama Newsprint, Videocon Appliances, Dewan Housing Finance, Transport Corporation of India, Super Spinning and Infotech Enterprises.

Thursday's major losers were Escorts Ltd, ING Vysya Bank, Jet Airways, Jaibharat Maruti, Novopan Industries, State Bank of Mysore and Gufic Biosciences.