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Sensex continues rising streak

Source : BUSINESS_STANDARD
Last Updated: Thu, Jan 03, 2013 20:01 hrs
Sensex drops 0.7 pct; banks down ahead of GDP data

BSE Sensex edged up on Thursday, marking a third consecutive session of gains that pushed indexes to their highest close in two years, as expectations for better-than-expected quarterly earnings lifted technology stocks such as Infosys.

Shares have started 2013 on a strong note as investors bet the central bank will cut interest rates later this month, and as the resolution to the so-called US “fiscal cliff” negotiations have benefitted global markets.

Foreign investors have also bought a net Rs 1,925 crore ($353.73 million) in equities this year, according to provisional exchange and regulatory data, after buying a net $24.37 billion last year.

However, analysts say 2013 would be a lot different from 2012, which saw a 25.7 per cent gain in the benchmark index , as budget problems in the US are far from over, while at home the fiscal deficit poses a challenge for a meaningful reduction in interest rates.

“Market is in a wait-and-watch mode because US problems are just postponed and not solved as discussion regarding debt limit will come back,” said Jagannadham Thunuguntla, head of Research at SMC Investments and Advisors.

Earnings growth in 2013 will largely depend on the central bank’s stance on rates and government policy measures, he added.

The benchmark BSE index rose 0.26 per cent, or 50.54 points, to end at 19,764.78, marking its highest close since January 6, 2011.

The broader NSE index rose 0.27 per cent, or 16.25 points, to end at 6,009.50, its highest close since January 6, 2011, and ending above the psychologically key level of 6,000 points.

India Inc is due to start reporting earnings next week, with Infosys kicking off on January 11.

Hopes that software service exporters would report solid earnings were amplified by expectations an agreement on the US fiscal cliff would improve demand from the key US market.

Infosys gained 1.24 per cent, Tata Consultancy Services rose 1.4 per cent, while Wipro ended up one per cent.

Jet Airways gained 4.7 per cent after a government source told reporters the carrier was the front-runner for an investment from Etihad Airways.

Jet later confirmed it was in talks with Etihad, in the first confirmation of a potential deal by either side.




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