With not so favourable global cues and the much awaited decision of the US Federal Reserve to cut the interest rate finally getting over, the Indian Stock Exchange witnessed a very volatile trading day on Wednesday.
The 30-stock Sensex of the Bombay Stock Exchange (BSE) gained a marginal 84.98 points or 0.42% to finally close at a new high of 20,375.87 points. While the broader S&P CNX Nifty of the National Stock Exchange (NSE) gained 62.05 points or 1.02% to close at 6,159.30 points. On the derivatives segment the December series of Nifty futures closed at 6,201.30 commanding a premium of 18.7 points with respect to its spot price.
In view of the current down turn in the US housing sector and to prevent the economy from going into a possible recession the 25 bps cut in the key rates on Tuesday by the US Fed, came as a disappointing move as many investors were expecting a cut of 50 bps, said dealers. Even the US markets fell on Tuesday, as their expectation of higher rate cut did not materialise.
In the early trades, Sensex opened on a weak note as most of the Asian markets opened negative, losing around 100 points, however it managed to recover all its losses on the back of huge buying at low levels in the heavy-weight stocks. Once again the mid- and small-cap indices succeeded in outperforming the benchmark index with BSE Mid-cap index surging 152.51 points or 1.66% to close at 9,339.49 points and the BSE Small-cap index gaining 217.15 points or 1.86% to close at 11,884.99 points.
Amitabh Chakravorty, president, Religare Securities said, “We were expecting a weak opening today based on negative cues from the world markets. However, the markets bouncing back is a good sign, which remained range bound there after. But a positive side was that even though the Asian markets ended on a negative note, we managed to decouple from the world markets. Also the figures about the industrial production were out which grew by 11.85% in November was a positive sign for the investors”.
Among the sectoral indices, BSE Metals posted a robust gain of 574.48 points or 3.01% to close at 19,629.07 points this was followed by BSE HC (Health Care), which gained 111.74 points or 2.75% to close at 4,173.98 points. Even the BSE realty index ended on a positive note at 12,540.32 points gaining 358 points or 2.94%.
As a result of continuous buying in these sectors the overall markets breadth was positive with of 2,139 companies advancing as against 750 companies that declined and value of 35 companies remained unchanged.
