Markets settle with marginal gains amidst volatility

Mumbai, May 9: The Sensex today settled in positive terrain on theBombay Stock Exchange with a nominal gain of 16.05 points at 13,781.51,following some value buying at lower levels that forced traders tocover their short positions during the second session.

''The market staged a sharp recovery, and infact posted gainstriggered by value buying at lower levels, which helped improve thesentiment, thereby forcing traders to cover their short positions.

Bears dominated first half of the session, but sporadic buyingsince afternoon session led to the bulls ultimately emerging victorious.

Besides Asian markets have also begun to firm up,'' market analysts explained.

After opening firmer at 13,771.69, it had touched a high of 13,801.91 and a low of 13,612.04 during intra-day trade.

Among the broader markets, the Nifty Index also ended in the greenon the National Stock Exchange (NSE) registering a paltry gain of 8points at 4,079.30 from its previous close of 4,077.00 points.

The market breadth, which indicates the overall health of themarket, recovered from initial weakness. However, it is still negative,as selling continued for small-cap and mid-cap stocks. On BSE, 1,396shares declined, 1,161 advanced and the prices of 102 stocks remainedunchanged. Its total turnover amounted to Rs 3,937 crore. Among the30-member Sensex pack, 21 advanced while the rest declined, stockbrokers said.

The government has not taken any decision to allow foreign directinvestment (FDI) in the retail sector, Union Finance Minister PChidambaram told the Rajya Sabha today. FDI was only permitted forcash-and-carry, wholesale and single brand retail. FDI inflow amountingto USD 13.5 billion in 2006-07 was the highest-ever. If retainedearning and swap deals were to be included, FDI would be USD 19billion, experts pointed out.

Japan's Nikkei rose 91.28 points to 17,748.12, its highest close sinceFebruary 27 this year. Hong Kong's Hang Seng index was up by 128.72points to 20,835.07 US stocks closed flat yesterday as investors lockedin profit after five straight sessions of gains in blue chips, a daybefore Fed's meeting on interest-rate policy. The Dow Jones industrialaverage dipped 3.90 points, or 0.03 per cent, to end at 13,309.07,after falling as much as 75 points.

The Standard&Poor's 500 Index slipped 1.76 points to finishat 1,507.72. But the Nasdaq Composite Index edged up 0.80 points toclose at 2,571.75.

A crucial US Federal Reserve's meeting today is scheduled in theevening today. It looks certain that Fed will hold interest ratessteady when it meets and will likely restate worries on inflation, evenwhile nodding to weak growth and easing of price pressures.

The US central bank has held the benchmark overnight borrowingcosts steady at 5.25 per cent for six consecutive meetings, stretchingback to August 2006.

Analysts believe that the Bank of England will lift rates to 5.5per cent tomorrow, a move that would put British interest rates abovethose in the US for the first time since Jan 2006. The European Centralbank (ECB) is expected to hold its rates steady at 3.75 per centtomorrow, but signal a hike in June this year.

Oil prices rebounded to above USD 65 a barrel today, as newattacks on Nigeria's oil industry deepened supply losses, interruptinga six-session losing streak that had driven prices to their lowestlevel since Mar 26. London Brent crude was up 6 cents to USD 65.60 abarrel.

India's largest commercial bank State Bank of India (SBI) advanced3.85 per cent to Rs 1123 on 8.44 lakh shares, and was the top gainer.ICICI Bank was up 1.25 per cent to Rs 852) and HDFC Bank was up 0.71per cent to Rs 997.

Bike maker Hero Honda followed with a gain of 3.46 per cent to Rs 703.REL was up 2.81 per cent to Rs 520), Tata Steel advanced by 2.11 percent to Rs 564.80), and Bajaj Auto gained by 1.65 per cent to Rs 2575.

Ranbaxy Laboratories gained 1.35 per cent to Rs 393.95.

Index heavyweight Reliance Industries (RIL) rose 0.27 per cent to Rs 1,598 on 6.38 lakh shares.

Information technology (IT) major TCS was the top loser, down by2.04 per cent to Rs 1,242, on renewed selling. Infosys was down 0.89per cent to Rs 1985 and Satyam Computers was down 1.12 per cent to Rs451.35.

Cipla slipped by 1.77 per cent to Rs 207.80), HLL was down 1.34per cent to Rs 191.90) and ONGC was down 1.21 per cent to Rs 911.

Fortis Healthcare, which listed today, settled at Rs 100, a discount over initial public offer (IPO) price of Rs 108 per share.

The stock debuted at Rs 105 and surged to a high of Rs 109.10. Itslow for the day is Rs 97.90. 1.38 crore shares changed hands in thecounter on BSE, traders disclosed.

UNI