Indian equities end in positive amid volatile trading (Weekly market review)

September 17th, 2011 - 3:42 pm ICT by IANS  

Sensex Mumbai, Sep 17 (IANS) Indian equities markets ended the week with marginal gains amid volatile trading as investors shrugged off the 12th successive rate hike by the Reserve Bank of India on positive global cues.

The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), ended the week at 16,933.83 points, up 0.40 percent or 66.66 points from its previous week’s close at 16,866.97 points.

The markets witnessed extremely volatile trading this week. The benchmark Sensex tumbled 365 points on the first day of the week on dismal industrial output data. However, the markets rebounded Wednesday with the Sensex gaining 283 points.

Industrial output growth slumped to 3.3 percent in July, the lowest in 21 months.

The markets were in a see-saw state Friday after the Reserve Bank of India hiked key policy rates by 25 basis points. The 30-scrip Sensex closed 57 points higher Friday.

At the National Stock Exchange, the 50-scrip S&P; CNX Nifty also ended the week in the positive amid volatility. The 50-scrip index closed 0.17 percent higher at 5,084.25 points Friday.

The RBI, the country’s central bank, Friday hiked key rates by 25 basis points in the 12th such exercise since January 2010 to tame stubborn inflation.

While the impact of the aggressive monetary tightening by the RBI is clearly visible on the growth, it has not been able to curb inflationary pressure.

Reacting to the RBI move, Finance Minister Pranab Mukherjee said Friday the rate hike would bring down inflation to a “comfortable” level sooner rather than later.

On the last trading day of the week major gainers on the 30-scrip Sensex were: Tata Motors, up 7.02 percent at Rs.161.70; ONGC, up 5.61 percent at Rs.274.70; NTPC, up 4.75 percent at Rs.172; and SBI, up 2.5 percent at Rs.1,945.55.

Major Sensex losers were: Hindustan Unilever, down 2.65 percent at Rs.340.05; Wipro, down 2.37 percent at Rs.339.80; BHEL, down 1.39 percent at Rs.1,686.45; and Tata Steel, down 1.3 percent at Rs.459.75.

“After the repo rate hike we have seen huge volatility in the market. Though 25 basis points hike in the repo rate was expected and already discounted, but after it was announced sell-off was seen in the market followed by bouts of rebound and fall,” said D.K. Aggarwal, chairman and managing director, SMC Investments and Advisors.

Markets rose globally amid optimism that European leaders would come out with more action plan to combat regional debt crisis.

In Asia, Japan’s Nikkei closed 2.25 percent up at 8,864.16 points, while Hong Kong’s Hang Seng index moved up 1.43 percent to close at 19,455.31 points Friday. Chinese markets closed on a flat note with the Shanghai Composite index closing 0.13 percent up at 2,482.34 points.

European and American bourses also rallied.

Britain’s FTSE 100 closed 0.58 percent higher at 5,368.41 points, the German DAX advanced 1.18 percent at 5,573.51 points. However, the French CAC 40 closed 0.48 percent down at 3,031.08 points Friday.

Dow Jones Industrial Average of the US rose 0.66 percent at 11,509.10 points. The index gained over 500 points in the weekly trade. The S&P; 500 Index closed 0.57 percent higher at 1,216.01 points.

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