MUMBAI: The Indian stock market rallied across the board Tuesday outperforming global markets yet another day. Indices opened on a dull note tracking lacklustre Asian markets while second rung stocks maintained upward march as advance tax numbers trickled in. However, in the last one hour of trade frontline stocks gained momentum led by Reliance Industries and ONGC.
“Indian oil companies were left behind when shares of global oil companies were moving higher. So they are just playing a catch up game,” said Deepak Sawhney, research head, Networth Stock Broking.
This rally helped the indices to cross psychological levels. Bombay Stock Exchange’s Sensex ended at 9,976.98, up 144.59 points or 1.47 per cent. The index managed to cross the crucial 10,000 level in intra-day trade. It zoomed to a high of 10,009.21 from a low of 9,790.31.
National Stock Exchange’s Nifty managed to close above the psychological level of 3000. It ended 2.03 per cent or 60.55 points higher at 3,041.75. The broader index hit a high of 3052.55 and a low of 2963.30.
“Since the beginning of this month Sensex has been outperforming the world markets while discounting bad news. We seem to be close to the end of last leg of recent pull-back rally. If the world market tilts towards negative, Indian market is likely to outperform on the downside as well,” added Sawhney.
Secondline stocks continued their run for a third consecutive day, outperforming bluechips. BSE Midcap Index closed 2.50 per cent up and BSE Smallcap Index ended 3.21 per cent higher.
“Midcaps were beaten down too much. With the rally in the frontline getting narrower, investors with cash were cherry picking in B-group companies which are expected to report better than expected quarterly results,” he said.
Significant gains in ONGC (6.07%), Grasim Industries (4.59%), ACC (4.34%), Tata Motors (4.33%), HDFC Bank (4.1%), and NTPC (3.5%) propped up the Sensex.
Losers comprised Sterlite Industries (-7.07%), HDFC (-4.13%), Reliance Infrastructure (-2.53%), Reliance Communications (-2.11%), and Larsen & Toubro (-1.23%).
There was some stock specific action also. Reliance Infrastructure and Reliance Natural Resources fell after reports that these two Anil Ambani owned companies were involved in fraudulent banking activities overseas. Shares of RNRL ended 2.21 per cent lower and Reliance Infrastructure slipped 2.97 per cent.
HCL Technologies rose after the firm said it has signed over $1 billion in contracts during Oct-Dec. This is the highest ever in a single quarter, helped by its purchase of British software firm Axon. HCL, on Monday, completed the largest overseas buy by an Indian IT firm spending 441 million pounds for Axon, topping a bid by larger rival Infosys Technologies. The HCL Tech scrip surged 18.49 per cent.
Suzlon Energy has revised the payment schedule agreed upon by the company and the Martifer Group of Portugal for Martifer's 22.4 percent stake in REpower Systems AG, Germany. As per the new terms, Suzlon will pay Martifer around Euro 65 million in December 2008, Euro 30 million in April 2009 and final tranche of Euro 175 million in May 2009. Upon completion of this transaction, Suzlon will reach ownership level of 91 per cent in REpower. The stock advanced 6.52 per cent.
Shares of airline companies were in demand on reports of a further 11 per cent cut in ATF prices after a steep decline in international crude oil prices. Kingfisher Airlines closed 5.41 per cent up and Jet Airways ended 3.95 per cent higher.
Market breadth on BSE remained extremely strong with 1,866 advances against 648 declines.
European markets bounced back on expectations of a rate cut by the US Federal Reserve. US markets were likely to open higher ahead of the FOMC meet. Dow Jones futures were up 0.68 per cent, S&P 500 futures moved 0.86 per cent higher and Nasdaq futures gained 1 per cent.