Sensex in India Surges, Rupee Gains

123jump.com Staff
10 Nov, 2008
New York City

Mumbai stocks surged on the hopes that global economy will stabilize after the G-20 meeting and China economic stimulus plan of $585 billion. Metals, realty and banking sector stocks closed sharply higher. October auto sales declined 6.6% on tighter credit conditions. Rupee gained 0.6% to 47.32.

[R]1:00PM New York, 11:30 PM Mumbai - India''s economy to grow to 6.7% in 2008-2009.[/R]

In Mumbai], the BSE Sensex rose 5.8% or 571.87 to 10,536.16 and the CNX Nifty gained 5.9% or 175.25 to 3148.25.

The Sensex crossed the psychological 10,000 mark and the CNX Nifty rose above the 3,000 mark on broad based buying. Stocks in Asia rose after China unveiled $585 billion of 4 trillion yen economic stimulus package to support the sagging economy.

Of the stocks traded on BSE 1,705 rose, 856 declined, and 70 were unchanged.

Trading Statistics

Daily turnover on the BSE increased to 3,689 crore rupees from 3,458.24 crore rupees on Friday last week. Sterlite Industries gained 14.2% after copper prices jumped 7.5%.

India’s Economic Growth Lowered to 6.7%

U.S. investment banker Goldman Sachs downgraded India''s economic growth fiscal 2009 forecast to 6.7% from the earlier estimate of 7.5% on a larger-than-expected impact of the global financial turmoil. The investment bank also revised the growth forecast for fiscal 2010 to 5.8% from 7%.

However, Prime Minister Manmohan Singh said during a tour of Gulf nations yesterday he expected the economy to grow between 7% and 7.5%.

China Unveils Rmb4 trillion Stimulus Package

Stocks in Asia closed higher and in Europe gained after China announced a fiscal stimulus plan to support the sagging economy. The size of the plan and need for a stimulus surprised the market.

China unveiled $585 billion in stimulus package focused at banking sector, farmers and small manufacturing companies that are taking the biggest brunt of the current economic slowdown. China plan will dedicated unspecified amount for infrastructure development.

The central bank in China last month relaxed loan standards for bank loans by removing caps on how much banks can lend and in the last two months lowered interest rate three times. The weekend announcement by China lifted markets in Asia and resource stocks in European trading.

Auto Sales in October Fell

October auto and vehicles sales fell sharply for the three of the last fourth months. According to the latest data from the Society of Indian Automobile Manufacturers auto sales dropped 9.1% and two-wheeler vehicles sales plunged 14%.

Gainers & Losers

Hindalco Industries rose 9.8% to 66.35 rupees, National Aluminium Company soared 12.4% to 186.20 rupees, Steel Authority of India advanced 5.8% to 89.30 rupees, and Hindustan Zinc gained 12.6% to 355 rupees.

Tata Steel advanced 12.8% to 214.40 rupees after Corus said on Friday last week it has extended its production cuts. Sesa Goa soared 8.3% to 86.55 rupees.

Reliance Industries jumped 7.2% to 1,305.

Telecommunications stocks rose. Reliance Communications gained 5.8% to 241.40 rupees and Bharti Airtel climbed 10.8% to 720.50 rupees.

Larsen & Toubro increased 5.2% to 916 rupees after its consortium with Malaysia''s Scomi Engineering Bhd won an order worth 2460 crore rupees and Bharat Heavy Electricals gained 6.8% to 1,500.90 rupees.

Suzlon Energy dipped 2.6% to 68.85 rupees after Morgan Stanley lowered the price target of the stock to 52.45 rupees from 450 rupees.

Financial stocks gained as well. ICICI Bank soared 9% to 470 rupees, State Bank of India edged up 5.3% to 1,314.90 rupees, and HDFC Bank gained 0.1% to 1,089.80 rupees.

Axis Bank increased 4.5% to 607 rupees, Kotak Mahindra Bank soared 5% to 432.20 rupees, and Punjab National Bank increased 1.9% to 505.50 rupees.

Tata Motors gained 7.1% to 170.20 rupees on bargain hunting, Mahindra & Mahindra rose 5.3% to 391.95 rupees and Maruti Suzuki India shed 0.6% to 594.05 rupees.

Software exporters advanced. Satyam Computer Services increased 7% to 297.10 rupees, Wipro gained 4.4% to 272 rupees and Tata Consultancy Services edged up 4.5% to 548 rupees.

Tata Power Company advanced 11.9% to 825.05 rupees and Reliance Power advanced 4.3% to 122.20 rupees.

Ranbaxy Laboratories soared 6.1% to 231.75 rupees, DLF increased 6.1% to 297.70 rupees, and Grasim climbed 5.5% to 1100 rupees.

Infrastructure stocks advanced. Reliance Infrastructure jumped 11.3% to 624.25 rupees, GVK Power & Infrastructure gained 14.5% to 20.82 rupees, GMR Infrastructure increased 17.4% to 79.25 rupees, and Lanco Infrastructure edged up 8.3% to 183 rupees.

Sugar companies increased. Shree Renuka Sugars climbed 9.6% to 68.45 rupees, Bajaj Hindustan rose 6% to 53.80 rupees and Balrampur Chini Mills increased 4.3% to 45.70 rupees.