Sensex snaps 3-day losing streak

Sensex snaps 3-day losing streak

Key benchmark indices on Thursday snapped a three-day losing streak after the latest data showed that the non-food manufacturing inflation or core inflation eased to a three-year low of 3.8 per cent in February 2013 from 4.1 per cent in January 2013.

Gains in world stocks underpinned sentiment on the domestic bourses.

The popular Sensex at BSE rose 207.89 points or 1.07 per cent to settle at 19,570.44 points, its highest closing level since March 11, 2013. The index jumped 242.15 points at the day’s high in late trade and slumped 183.22 points at the day’s low in morning trade.

The 50-unit CNX Nifty at NSE rose 57.75 points or 0.99 per cent to settle at 5,908.95, its highest closing level since March 12, 2013. The index hit a high of 5,920.15 and a low of 5,791.75 in intraday trade.

Index heavyweight Reliance Industries (RIL) extended intraday gains in late trade, while bank shares rebounded from their day’s low as investors are expecting a rate cut by RBI in its monetary policy on March 19.

The State Bank of India, ICICI Bank, HDFC Bank, Dena Bank, Canara Bank and Oriental Bank of Commerce ended higher by more than 3 per cent each on BSE.

Some of the banking stocks including Axis, which were marred in the money laundering controversy, also recovered during the day as analysts see no risks to these stocks due to reports of online magazine Cobrapost that these banks allegedly indulged in money laundering.

As per the data revealed by the Centre on Thursday, the wholesale price index inflation (WPI) stood at 6.84 per cent in February 2013, as against 7.56 per cent in the corresponding period in the previous year. Inflation was declining for four months in a row till January. In January 2013, WPI inflation was at 6.62 per cent.

The market sentiment in D-Street was also boosted by data showing that foreign funds remained buyers of Indian stocks on Wednesday, March 13, 2013. Foreign institutional investors (FIIs) bought shares worth a net Rs 304.70 crore from the secondary equity market on Wednesday, as per Sebi data.

Commenting on the market, India Infoline Reseach Head Amar Ambani said, “While the headline inflation print came higher than expectations at 6.8 per cent, the continued moderation in core inflation kept the market expectation alive that RBI would cut the repo rate by 25 bps on the coming Tuesday.

The central bank is likely to take heart from the fact that increase in WPI month-on-month was essentially driven by deregulation of fuel prices. Further moderation in core inflation during March would enhance possibility of a rate cut on May 3 also.”

From the broader markets, the BSE Mid-Cap index rose 0.48 per cent to 6,426.02 points and the BSE Small-Cap index fell 0.09 per cent to 6,231.76 points. Both these indices underperformed the Sensex.

The market breadth was negative with as many as 1,446 shares on BSE fell and 1,420 scrips rose while a total of 118 stocks were unchanged.