Bulls on rampage; Nifty reclaims 5000 mark

Bulls were on a rampage on Wednesday helping the 50-share Nifty to reclaim the 5000-mark after six trading sessions. The 30-stock Sensex

managed to garner over 400 points as well. Metals and technology stocks were the star-performers. The day began with positive news from Asian shores where China's economic data beat market forecast. The country's industrial production and trade surplus climbed in October, indicating a recovery. However, it failed to enthuse market participants back home with equities witnessing a sluggish start. The next trigger which sent the key indices sharply higher was the strong opening on the European bourses, signaling bullishness. According to the latest jobs data, UK's unemployment rate rose at the slowest pace in 18 months which boosted sentiment that the economy is on the road to recovery. "The market has closed on a very strong note. From hereon, we expect the Nifty to scale to 5050-5100 in the near term while support lies at 4900. Unless 4900 is breached, the market is poised upward. Being sector-specific, I believe capital goods will take lead with Larsen & Toubro being the top bet. Technology stocks like Infosys also look attractive," said Michael Pillai, technical analyst at Nirmal Bang Securities. National Stock Exchange's Nifty settled at 5003.95, higher by 2.5% or 122.25 points. The index climbed to a high of 5016.70 from a low of 4870.05 intra-day. Bombay Stock Exchange's Sensex ended at 16,849.60, up 409.04 points or 2.49% from the previous close. The index surged to a high of 16,887.80 from a low of 16,405.19. Midcaps and smallcaps participated in the rally as well. The BSE Midcap climbed 2.01% and BSE Smallcap Index rose 1.6%. Sectorwise, BSE Metal Index surged 4.27%, BSE IT Index rose 3.94% and BSE Realty Index advanced 2.34%. The Nifty rally was led by Sterlite Industries (6.15%), Reliance Infrastructure (6.04%), Jaiprakash Associates (5.63%), HCL Technologies (5.29%) and Tata Steel (4.61%). BPCL (-1.38%), Idea Cellular (-0.6%) and Cairn (-0.09%) were the only laggards in the 50-share index. Market breadth was strong with 1726 advances against 1004 declines on the BSE. Meanwhile, the Reserve Bank of India said it may withdraw some monetary stimulus if inflation rises towards the end of 2009. "The central bank will wait and see how price situation develops in Nov-Dec," C Rangarajan, chairman of the Prime Minister's Economic Advisory Council said. The fiscal deficit needed to be reduced by 1 to 1.5 percentage points in the next fiscal year, he said. Among stock-specific news, Shree Renuka Sugars acquired Brazilian sugar and ethanol producer Vale Do Ivai S A Acucar E Alcool for $82 million. The acquisition includes two sugar and ethanol production facilities with a cane crushing capacity of 3.1 million tonnes per annum. Shares of the company ended at Rs 218.95, up 2.31% on the NSE. On the other hand, entertainment firm Pyramid Saimira Theatre nosedived nearly 10% to hit the lower circuit after market regulator SEBI banned the entity from dealing in stock markets for seven years. Shares of Pyramid Saimira plunged 9.82% to hit the lower trading limit at Rs 19.75 on the BSE.

DIPANKER SUHALKA

PGDM III SEM