India Stocks Surge; Reliance Industries Net Up 28%

Devan Biswas
01 Nov, 2010
New York City

Stocks in Mumbai traded sharply higher after the market leader Reliance Industries reported 28% increase in earnings. Resource stocks gained after China reported faster economic growth. The Reserve Bank of India is expected to announce a rate hike tomorrow.

[R]4:30PM Mumbai – Stocks in Mumbai traded sharply higher after the market leader Reliance Industries reported 28% increase in earnings. Resource stocks gained after China reported faster economic growth. The Reserve Bank of India is expected to announce a rate hike tomorrow.[/R]

India stocks surged on the back of sharply higher earnings from the market leader Reliance Industries and the strength in the international markets.

Resource stocks in India tracked the world gains after China reported a rise in manufacturing. The faster growth lifted prices of aluminum, copper and zinc in international trading. Traders also drove the resource stocks on the prospect of lower dollar as the U.S. Fed is widely expected to announce more stimulus measures this week.

The Sensex open higher and surged quickly to close up 1.6% to 20,355.60 and the CNX Nifty index gained 1.65% to 6,117.55.

Rupee held firm and closed at 44.41 to a dollar, 62.08 to one euro and 71.40 to a UK pound. Ahead of the quarterly review and rate decision tomorrow from Reserve Bank of India the rupee held firm. Also, the refund of Coal India IPO weighed on the rupee. Government is expected to refund the Coal India public offering that was oversubscribed fifteen times.

Technical errors at the Bombay Stock Exchange shut the trading down for two and a half hours. At midday the exchange announced the halt for one hour and later and extended for another ninety minutes.

Stock Movers

Banks and pharmaceuticals closed higher after ICICI Bank and Sun Pharmaceuticals reported higher than expected earnings.

Hindalco Industries Ltd added 1.1% to Rs 212.95 and National Aluminum Corp increased 0.9% after latest quarter net soared 41% on higher output and better prices.

Reliance Industries declined 0.3% to Rs 1,093 after rising as much as 1.5% after net income in the latest quarter increased 28% to Rs 4,920 crore.

Markets in Asia and China gained sharply on the back of positive data on manufacturing.

Manufacturing index tracked by China Federation of Logistics and Purchase and National Bureau of Statistics increased to 54.7 in October from 53.8 in September. Another index tracked by HSBC Holdings Plc and Markit Economics increased to 54.8 from 52.9.

The purchasing managers’ index, widely known as PMI showed a sustained manufacturing growth as exports rebound and construction activities stay robust.