Sensex up 143 pts at fresh 30-month-high; RIL below Rs 1,000

The BSE benchmark Sensex today jumped by 143 points to close at a fresh 30-month high on strong buying support from FIIs in interest rate-sensitive realty, auto and banking stocks, even as RIL fell for the fourth day to end below the Rs 1,000 level.

Amid positive cues from Asian markets, which shrugged off disappointing US jobs data, the 30-share index of the Bombay
Stock Exchange opened on a positive note and accelerated in
the afternoon session after European bourses opened higher.

The Sensex ended the day higher by 143.51, or 0.79%, at 18,287.50, the highest closing level since February 2, 2008.

Analysts, however, said some profit-booking in the coming days cannot be ruled out.

They also said a slew of factors improved the market sentiment. Monsoon rains were 16 per cent above normal in the week ended August 4, 2010. In addition, record overall auto sales in July were promising, they pointed out. However, the real mover of the market was heavy buying by foreign institutional investors (FIIs).

It is widely expected that good monsoon rains would lead to better farm production, which would ease supply pressure on inflation.

Affirming their faith in the India growth story, foreign fund houses have parked Rs 51,185 crore ($11.1 billion) in domestic stock markets so far in 2010, more than half of their record investment made in 2009. In the past week alone, FIIs infused Rs 5,590 crore into local stocks, as per Sebi data.

"FIIs are bullish about emerging nations, especially the Indian economy, and are parking money as they see a long-term gain here. The trend is likely to continue for coming period," Unicon Financial CEO Gajendra Nagpal said.

Barring the oil & gas and the pharma index, all the other BSE sectoral indices ended in the green.

Realty major DLF, which had lost about 1% on Friday, surged nearly 4% to emerge as the top performer in the Sensex.

Banking stocks were also in hot demand. The country's top private sector lender, ICICI Bank, climbed 3%, HDFC 1.52% and SBI 1.12%.

The auto index was another strong performer, driven by record sales in the passenger car and two-wheeler segments in July. The Indian automobile industry logged its best ever monthly sales of 12,37,461 units in July, beating the previous high achieved in March, 2010, according to figures released by the Society of Indian Automobile Manufacturers.

Tata Motors jumped 2.7% on expectations of robust June quarter earnings, which will be announced tomorrow. Other auto stocks, too, attracted strong buying support on the back of good July sales numbers. Maruti moved up nearly 1%, Hero Honda 1.35% and M&M 0.15%.

Metal counters attracted buying support on the back of rise in metal prices overseas, analysts said. Jindal Steel increased by nearly 2%, Hindalco and Sterlite both by 1.7% and Tata Steel by 1.46%.

IT stocks, which were in the red in the early part of the session amid a rise of 20 paise in the value of the Indian rupee against the US currency, recovered to end with gains. Infosys rose 0.32% and TCS 1.44%.

However, energy giant RIL, drug major Cipla and leading lender HDFC Bank did not participate in the rally and closed in the red.

Reliance Industries, which carries the maximum weight in the Sensex, continued to slide for the fourth straight session and lost 0.66% to close at Rs 993.65. During the day, RIL had hit a low of Rs 992.15, its lowest level in one month. 

HDFC Bank fell 0.74% and was the worst performer in the BSE-30. Cipla dropped 0.28%.

On the global front, all the key indices across the Asia, except Japan, and Europe were trading in the green. US Futures were also up in early trade.