Sensex closes 200 points higher on strong global cues

Written by fe Bureaus | Agencies | Mumbai | Updated: Jun 30 2010, 04:53am hrs
The country's equity indices on Monday rose by more than a percentage point, snapping a two-day decline, mostly tracking gains in the European markets and on hopes of buoyant corporate earnings. The 30-share Sensex of the Bombay Stock Exchange (BSE) climbed to a one-week high, up 199.7 points, or 1.14%, at 17,774.2. The broader 50-share Nifty of the National Stock Exchange (NSE) was up 64.4 points, or 1.22%, at 5333.5.

According to Tata MF CEO Ved Prakash Chaturvedi, foreign institutional investors (FIIs) would continue to invest in India as the countrys growth story was intact. Our growth story is still appealing and based on the domestic demand. Whats more, we have a stable currency and political environment, he said.

However, Chaturvedi cautioned that valuations appeared stretched and one needed to be on the lookout for high-risk events emerging from euro zone. The most important triggers for the market will be the corporate results. The market will also keep a close watch on inflation numbers as that could determine the central banks decision to rate hikes. The market rose mostly because of the rally seen in scrips of the ADAG group and oil marketing companies (OMCs), said Ambareesh Baliga, VP, Karvy Stock Broking. Shares of OMCs soared on the second consecutive trading session, after the government hiked diesel prices, and aligned petrol prices to those in overseas markets. Reliance Communications rose 4.6% in view of the companys proposal to sell its passive infrastructure arm to GTL Infra. According to BSEs provisional estimates, FIIs were net buyers to the tune of Rs 792 crore, while domestic institutional investors sold shares worth Rs 94 crore.

The NSE cash turnover on Monday was at Rs 13,138 crore.

Among its peers, the performance of key benchmark equity indices in Asia Pacific was mixed. Straits Times and Jakarta Composite are 0.64% and 0.3%.