Sensex ignores bad news, up 4%

Written by Markets Bureau | Mumbai | Updated: May 13 2009, 05:30am hrs
Sensex intra day
Buoyed by fresh inflows from foreign institutional investors (FIIs) and pension funds, equity indices in Mumbai made huge gains on Tuesday, ignoring, in its wake, poor industrial production data and sobering cues from emerging markets.

After starting the day in the red and remaining volatile, sustained buying at the end of the day saw the markets close with a positive gap. The Sensex added 475.04 points or 4.07% to close at 12,158.03 points. The Nifty ended the day at 3,681.10 points, gaining 126.50 points or 3.56%. Incidentally, emerging-market stocks fell the most in two weeks; the MSCI Emerging Markets Index dropped 1.1% to 715.78 in early trades in London.

Pension funds, which were sitting on cash, entered the markets, which led the markets during the last hours of trading. Apart from FIIs, domestic institutional investors (DII) were net buyers in the market, said Anita Gandhi, head of institutional business at Arihant Capital Markets.

The decline in industrial production by 2.3% in March compared to a rise of 5.5% in the same month in 2008 also did not deter buyers. According to provisional BSE figures, FIIs and DIIs were net buyers of Rs 452.18 crore and Rs 177.74 crore, respectively.

Overall, the breadth of the market remained positive as out of 2,586 stocks traded on BSE, 1,410 advanced, 1,101 declined while 75 stocks remained unchanged.

With the last phase of polls completing on Wednesday, dealers feels markets would be unstable on Thursday and Friday, ahead of results on Saturday.