Indian markets toast UPA win as sharp surge halts trading (Third Lead)May 18th, 2009 - 2:54 pm ICT by IANS
Mumbai, May 18 (IANS) The Indian stock markets Monday gave a resounding welcome to the electoral victory of the Congress-led coalition and trading was suspended for the day at the bourses after key indices touched the upper circuit filter twice in about two hours.
This was for the first time trading was suspended for the day at both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) because their key indices hit the upper circuit - an in-built mechanism to curb excessive volatility.
At the opening bell Monday, the 30-share sensitive index (Sensex) of the BSE stood at 13,479.39 points, with a gain of 1,305.97 points, 10.72 percent, over the previous close.
It then immediately shot up further, with the gains amounting to 14.7 percent over the previous close, hitting the upper circuit filter of 13,963.3 points. Trading at that point was suspended by two hours till 11:55 a.m.
But when trading resumed, it took all of one second for the investor frenzy to once again push the key index to the next level of circuit filter, triggering an automatic suspension of trading for the day.
The gains amounted to 2,099.21 points, or 17.24 percent, for the barometer index.
This was the first day of trading following the announcement of results Saturday after the national elections held in April and May that handed a dramatic electoral victory to the Congress-led United Progressive Alliance (UPA) government.
“This should be a big bang for the market,” said the Citigroup in the country strategy for India. The financial powerhouse expected the Sensex to easily hold ground above the 13,500-point mark in the near term.
Over the past month, the Sensex has gained 29.48 percent, or 3,249.54 points, of which more than 2,000 points was added Monday.
The S&P CNX Nifty of the NSE mirrored the movement of the Sensex and surged 14.48 percent on opening, and hit the upper circuit at 4,203.3 points, leading to a halt in trading.
Once trading resumed at 11:55 a.m, the frenzy continued. The index breached the upper circuit and trading had to be suspended for the day.
The Nifty, which opened at 3,673.15 points, rose 17.33 percent or 636.4 points to close at 4,308.05 points. It closed Friday at 3,671.65 points.
Only 842 stocks were traded on the BSE, while 207 scrips changed hands on the NSE.
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