Sensex surges 644 points on good Q4 results

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Mumbai, Apr 26: The 30 scrips of Bombay Stock Exchange (BSE) Sensex surged by 644.78 points, or 3.91 per cent (pc), to 17,125.98 during the week ended yesterday on good fourth quarter (Q4) results and firm global markets. Similarly, S &P CNX Nifty index of National Stock Exchange (NSE) rose by 153.3 points, or 3.09 pc, to 5,111.70 during the same period on some fresh sepculative demands from foreign institutional investors (FIIs) on better performance report of Q4 results from corporate sectors.

Brokers said ''The market shrugged off a steep 50 basis points hike in cash reserve ratio (CRR) and edged taking cues from firm global markets and on initial batch of good Q4 results. The BSE Mid-Cap index rose 219.82 points, or 3.22 pc, to 7,056.21 in the week. The BSE Small-Cap index slumped 196.36 points, or 2.30 pc, to 8,727.72.

The market extended gains for the fifth session on April 21. On that day, the 30-share BSE Sensex rose 258.13 points or 1.57 pc at 16,739.33. The broader based S &P CNX Nifty rose 78.60 points or 1.59 pc at 5,037.

The market extend its rally for sixth straight session on April 22 2008 led by real estate, cement and infrastructure stocks. On that day, the 30-share BSE Sensex rose by 44.54 points, or 0.27 pc, at 16,783.87. The broader based S &P CNX Nifty was up 12.30 points, or 0.24 pc, at 5,049.30.

On April 23, volatile trading in banking, capital goods and select blue-chip stocks jolted the market, pulling it further down.

On that day, the 30-share BSE Sensex lost 85.83 points, or 0.51 pc, at 16,698.04, while Nifty was down 26.50 points, or 0.52 pc, at 5,022.80.

The key benchmark indices, after witnessing a bout of volatility ahead of expiry of April 2008 derivative contracts, witnessed a divergent trend next day. On that day, the Sensex gained 23.04 points, or 0.14 pc, at 16,721.08, while Nifty lost 22.95 points, or 0.46 pc, at 4,999.85, brokers informed.

In April 25, the market spurted following steady build-up of fresh positions in the derivatives segment on the first day of May 2008 series. The Sensex galloped 404.90 points, or 2.42 pc, at 17,125.98, while Nifty was up 111.85 points, or 2.24 pc, at 5,111.85.

Reliance Industries (RIL), India's largest private sector company in terms of market capitalisation and oil refiner, fell 0.47 pc to Rs 2,624.50 on profit-booking.

India's largest private sector bank by assets ICICI Bank soared 9.69 pc to Rs 916.15.

Maruti Suzuki India, India's top small carmaker in terms of sales, fell 2.99 pc to Rs 737.25 after announcing negative Q4 March 2008 results. Its net profit declined to Rs 297.68 crore, or 33.63 pc, as compared to the corresponding period last year.

India's largest private sector engineering company in terms of outstanding order book position, Larsen&Toubro, gained 7.03 pc to Rs 2,971.35 on reports that it plans to develop a commercial complex at Seawoods railway station, Navi Mumbai over 40 acres of land for Rs 3,500 crore. The company made this announcement on April 21.

Satyam Computer Services, India's fourth largest IT services firm by sales, slipped 5.19 pc to Rs 444.60 due to selling pressure by local operators despite better performance in Q4 results. While Wipro's rose 1.52 pc to Rs 466.20 on good Q4 results on April 18.

With uncertainty in the business environment, the company is conservative about forecasts. For the first quarter of fiscal 2009, Wipro expects revenue from combined IT services to be USD 1,060 million.

The wholesale price index rose 7.33 pc in the year through April 12, accelerating from the previous week's annual rise of 7.14 pc, government data showed on April 25. The annual inflation rate was 6.34 pc during the corresponding week of the previous year.

Reserve Bank of India hiked cash reserve ratio (CRR) by a steep 50 basis points on April 17. The unscheduled CRR rate hike comes ahead of its annual credit policy announcement for 2008-09 on April 29.

The central bank joined the government in battling the skyrocketing inflation. The wholesale price index rose 7.14 pc in the 12 months to April 5. This was slower than the previous week's annual rise of 7.41 pc.

CRR is the amount of money banks have to keep with RBI as a percentage of their liabilities (deposits). CRR hike will be introduced in two stages. In the first stage, RBI will raise CRR by 25 basis points to 7.75 pc on April 26. Another 25 basis point hike will come into effect from May 10. As a result, about Rs 18,500 crore of banks' resources would be taken out of the system, brokers added.


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