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Sensex vaults on Moody's outlook, Greece deal

Source : BUSINESS_STANDARD
Last Updated: Tue, Nov 27, 2012 19:30 hrs

The market on Tuesdasy gained the most in over two months, after Moody’s Investors Service reiterated its stable outlook on India’s credit rating and Europe reached a deal on Greece. Finance ministers in Europe reduced Greece’s interest rates and gave it more time to pay back loans, sparking a rally in most global markets.

Meanwhile, Moody’s said India’s Baa3 rating is supported by economic growth that is more than emerging-market averages, helping India post the biggest gains in Asia.

Gaining the most since September 21, the 30-share Sensex of the Bombay Stock Exchange (BSE) gained 305 points, or 1.65 per cent, to 18,842.08, while the National Stock Exchange’s 50-share Nifty rose 91.55 points, or 1.62 per cent, to 5,727.45.

The Sensex, which on Tuesdasy closed at its highest levels since November 8, is less than 300 points away from a year’s high.

“The newsflow on Europe and Moody’s contributed to the positive sentiment,” said Kaushik Dani, a fund manager at Peerless Mutual Fund. “Foreign flows have been strong, irrespective of weak economic macros and political uncertainties, signalling the confidence investors have in India’s long-term growth,” he added.

Foreign institutional investors (FII) on Tuesdasy bought shares worth Rs 1,083 crore, while domestic investors sold shares worth Rs 208 crore, according to provisional figures on the BSE.

Foreign investors, who have bought shares on most days this month, are only $800 million short of taking the year-to-date investment tally to $20 billion. FII investment into the Indian market this year is among the highest among 10 Asian markets tracked by Bloomberg, excluding China.

All sectoral indices of the BSE advanced. The BSE realty and consumer durable indices gained the most with three per cent gains each. Fast-moving consumer goods and banking indices also added about two per cent each.

Barring two stocks, all other components of the Sensex closed with gains. Bharti Airtel gained the most at 5.22 per cent, followed by Sterlite at 3.56 per cent. “The index may face strong resistance at the 5790 level. Market sentiment would also depend on the derivative expiry,” said Amar Ambani, head of research at IIFL.

The market will be closed tomorrow on account of Gurunanak Jayanti.




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