Sensex soars 539 points as traders go short

Sensex soars 539 points as traders go short

Festival & weekend holidays ahead has players cover their positions

Largely firm Asian cues helped key indices of both BSE and NSE to start on a positive note, while favourable European stocks also helped the surge and at the same time, buying by domestic investors and higher US index futures boosted the sentiments in Dalal Street.

Also, 20 per cent jump in advance tax collection from India Inc. in the first 9-months helped the market surge. Analysts, however, allude the day’s rally to traders covering their huge short positions with not much sessions left for the calendar year 2009.  The market remains closed for four days in a row from Friday to Monday — due to Christmas and Muharram.

Index heavyweight Reliance Industries (RIL) spurted on a new gas find in the prolific KG basin, while three other index heavyweights - ICICI Bank, Infosys and L&T, also surged. Metal, power, capital goods, realty, banking and IT stocks, jumped. All the sectoral indices on BSE were in green and the market breadth was strong.
The BSE Sensex rose 539.11 points or 3.23 per cent to close at 17231.11 points, its highest closing since October 17, 2009. The BSE Mid-Cap index rose 1.57 per cent and the BSE Small-cap index rose 1.51 per cent. The S&P CNX Nifty rose 158.75 points or 3.18 per cent to 5,144.60 points. 

Nifty December 2009 futures were at 5,157.50, at a premium of 12.90 points as compared to the spot closing of 5,144.60. Turnover in NSE’s futures & options (F&O) segment spurted to Rs 117607.57 crore from Rs 60289.04 crore on Tuesday.
The market breadth, indicating the overall health of the market, was strong with as many as 1898 shares on BSE advanced as against 931 scrips that declined and a total of 92 stocks remaining unchanged.  All the stocks from 30-member Sensex pack rose. BSE clocked a turnover of Rs 4933 crore.

In overseas markets, European shares rose on Wednesday, the last full trading day before the Christmas holiday, extending a recent rally, with the key benchmark indices in France, Germany and UK rose by between 0.46 to 0.83 per cent.
Asian shares edged higher on Wednesday with the key benchmark indices in Indonesia, South Korea, Singapore, Taiwan, China and Hong Kong rose by between 0.35 to 1.12 per cent. Japan’s markets were closed for the Emperor’s Birthday.
Trading in US index futures indicated Dow could gain 30 points at the opening bell on Wednesday, 23 December 2009.

Back home, a deluge of global liquidity has had boosted stocks across the globe this year. The Sensex is up 7583.80 points or 78.61 per cent in calendar year 2009, as on December 23, 2009.