Despite some listless movements and a couple of setbacks during the session, the Indian stock market snapped a five-session losing streak and ended on a positive note on Friday as investors picked up several blue chip stocks, buoyed by some reforms measures announced by the government.
The lower than expected surge in inflation (for November) did raise doubts about a rate cut from the central bank, but investors mostly stayed at the ring, betting on hopes of speedier reforms. Worries about looming U.S. fiscal cliff and weak European markets hurt sentiment to an extent.
According to the data released by the government, inflation declined to 7.24% in November from 7.45% in the previous month and 9.46% in November, 2011. The primary articles inflation rose to 9.42% as against 8.21% in the previous month. The food articles ifnlation rose to 8.5% as compared to 6.62% in October.
The BSE benchmark Sensex, which rallied to 19,348.85 around noon after declining to around 19,193 earlier in the session, faltered again in mid afternoon trade, but recovered swiftly to sign off on a positive note on Friday. The BSE barometer ended the day with a gain of 87.99 points or 0.46% at 19,317.25. The Nifty index of the National Stock Exchange closed at 5879.60, recording a gain of 28.10 points or 0.48%. The Nifty touched a high of 5886.10 and a low of 5839.15 during the day.
Metal stocks had a good outing. Several stocks from banking and realty sectors posted smart gains. Select information technology, automobile and oil stocks too ended on a firm note.
Capital goods stocks ended mixed. FMCG and power stocks recovered after a weak spell. Power and healthcare stocks were mostly subdued.
Sterlite Industries and Hindalco ended stronger by over 3.5%. Jindal Steel and Tata Steel moved up by 2.5% and 2.4%, respectively.
State Bank of India gained 2.6%. Tata Motors, Tata Consultancy Services, NTPC and ICICI Bank climbed up 1.3% - 1.6%. Mahindra & Mahindra ended nearly a percent up, while Larsen & Toubro, Reliance Industries and Wipro gained 0.5% - 0.8%.
Bank of Baroda, up 3.75%, was the top gainer in the Nifty index. Sesa Goa gained nearly 3.5%. Axis Bank, Kotak Bank, Ultratech Cement, DLF, HCL Technologies, Cairn India and Reliance Infrastructure moved up by 1% - 2.5%. ACC, IDFC and Grasim Industries also closed on a firm note.
Bharti Airtel, Power Grid Corporation, Jaiprakash Associates, BHEL, Siemens, Tata Power, Cipla, Dr Reddy's Laboratories, Hero Motocorp, Asian Paints and Lupin closed with sharp to moderate losses.
Realty stocks found support following the Union Cabinet clearing the new land acquisition bill, paving way for its introduction in the ongoing winter session of the parliament. According to the provisions of the bill, consent of 80% of landowners would be needed to acquire land for private industrial projects. The consent would be 70% in case of public-private partnership projects and no consent would be required in case of projects acquired for government purpose.
Fertilizers stocks too attracted buyers, after the Union Cabinet approved a urea investment policy that is likely to incentivise fertiliser firms setting up new plants and expanding existing capacity. Under the new policy, the government will give 12-20% post-tax return on fresh capital infused by manufacturers for setting up of new plants as well as for expansion and the revamp of the existing ones.
The market breadth was even. Out of 3046 stocks traded on BSE, 1452 stocks moved up. 1475 stocks declined and 119 stocks ended flat.