Markets recover on Chidambaram assurance, end with gains (Second lead)

September 18th, 2008 - 6:07 pm ICT by IANS  

SensexMumbai, Sep 18 (IANS) Despite huge early losses, Indian equities markets Thursday staged a smart recovery to end the day in the green zone on strong buying by domestic institutions following assurance of adequate liquidity by the Indian finance minister.“There was strong buying with high volumes in Reliance, State Bank of India, Larsen & Toubro and other banking stocks,” said portfolio strategist and US-trained chartered financial analyst Manoj Krishnan of Delhi-based Price Investment Management and Research Services.

The 30-share benchmark sensitive index (Sensex) of the Bombay Stock Exchange (BSE) closed at 13,315.60, gaining 52.70 points or 0.40 percent over its previous close of 13,262.90 Wednesday.

The broader based 50-share S&P Nifty of the NSE also ended the day with a gain closing at 4038.15, up 29.9 points or 0.75 percent against its previous close at 4,008.25 Wednesday.

The BSE opened with the Sensex crashing by more than 700 points on extremely weak global cues as the Dow Jones industrial average closed Wednesday with a 440-odd points loss. All other European markets had also finished in the red.

Asian markets also showed losses Thursday morning with the Hang Seng index of the Hong Kong stock market losing 7.5 percent over its previous close Wednesday.

“This led to punters entering the market with a gloom and doom outlook but with domestic institutional buying and the finance minister’s statement assuring adequate liquidity, there was recovery,” Krishnan said.

The S&P Nifty too had opened nearly 200 points down but recovered enough to end in the green zone at closing.

The BSE mid cap index, however, failed to recover enough to wipe out losses completely and closed at 5,079.13, down 60.50 points or 1.18 percent over its previous close at 5,139.63 points.

The BSE small cap index too failed to recover enough and closed at 6,075.43, losing 139.32 points or 2.24 percent against its previous close at 6,214.75.

“Buying was restricted to only about 70-odd stocks,” Krishnan said explaining the failure of smaller stocks to recover as much as those in the Sensex basket and other large cap stocks.

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