Indian investors show legendary resilience, push equities into green (Roundup)November 28th, 2008 - 6:41 pm ICT by IANS
Mumbai, Nov 28 (IANS) with Indian equities market ending marginally in the green Friday, Indian investors once again proved their resilience in the face of terror and sent out a strong and positive signal to the world that they still have full confidence in the long-term India growth story.Despite terrorists claiming at least 125 innocent lives and holding the country’s financial capital to gun for more than 43 hours, the 30-share benchmark sensitive index (Sensex) of the Bombay Stock Exchange (BSE) finished at 9,092.72, up 66.00 points or 0.73 percent from its previous close at 9,026.72 points.
“It was a terrific day of resilience with the investor community sending a very positive signal of sanity and rationality and their faith in the long-term story of India,” Jagannadham Thunuguntla, director of the country’s fourth largest share brokerage house, the SMC Group, told IANS.
The broader-based 50-share S&P CNX Nifty of the National Stock Exchange (NSE) too closed higher at 2,755.10, up 2.85 points or 0.10 percent from its previous close at 2,752.25 points.
The BSE midcap too ended higher at 2,885.76, up 8.38 points or 0.29 percent from its previous close at 2,877.38 points.
The BSE smallcap, however, ended marginally in the red at 3,304.61, down 10.28 percent or 0.31 percent from its previous close at 3,333.42 points.
The Sensex opened lower at 8,889.18 and despite showing some volatility within a narrow range, clearly displayed the same underlying resilience of Indian investors by soon moving into the positive zone to hit an inter-day high of 9,157.62, more than 130 points higher than the previous close, and then finally ended at its closing value.
Sectorally, information technology, telecommunication, entertainment and media and technology, automobiles and fast moving consumer goods were the major gainers.
Realty, metals, public sector units and oil and gas were the major losers.
The top gainers were Tata Consultancy Services, up 5.89 percent followed by Bharat Heavy Electrical Ltd., up 4.78 percent, Infosys Technologies, up 4.49 percent and Mahindra and Mahindra Ltd., up 4.47 percent.
The top losers were Reliance Infrastructure, down 3.26 percent, Larsen and Toubro, down 3.14 percent, Grasim Industries, down 3.03 percent and National Thermal Power Corp, down 2.86 percent.
Some 915 stocks or 43.72 percent advanced, 1,114 stocks or 53.23 percent declined and 64 stocks or 3.06 percent remained unchanged.
Markets reopened Friday at the normal time but under ‘Z’ category security - usually reserved for VVIPs - after remaining closed Thursday following the unprecedented terror attack on the country’s financial capital and capital of western India state of Maharashtra.
State Chief Minister Vilasrao Desmukh had, however, expressed dissatisfaction Thursday that market authorities and the market regulator had decided to keep markets closed Thursday. Terror should not be allowed to disrupt business, was his view.
As markets were closed Thursday, the monthly settlement of futures and options trade had to be deferred to Friday.
This also had a bearing on keeping the markets open Friday as two consecutive days of closure would have further eroded investor confidence and almost surely would have sent the markets into a tailspin when it opened Monday, analysts said.
“This would have been unfair to those holding long positions as they would then have run up huge losses while those holding short positions would have made unfair profits,” Thunuguntla said.
Overnight global clues were positive with a key index of the New York Stock Exchange finishing 3.2 percent higher Thursday and the Nasdaq index too ended 4.6 percent higher.
Asian markets too ended with gains Friday with the Nikkei, the key index of the Tokyo Stock Exchange, finishing 1.66 percent higher and the Hang Seng, key index of the Hong Kong Stock Exchange, closing 2.48 percent higher.
“Today was the day for settlement of futures and options trade and although this is usually the big issue that drives markets on such days, today’s movements were clearly dominated by the need to send out a positive signal given the terror attacks,” Thunuguntla said.
“Even foreign institutional investors realize that terrorism is today a global issue and is not India-specific and, therefore, there is no need to quit India on this issue,” he said.
“After all, everyone still recognizes that India is a very attractive market and the bear market that we are seeing now is only because of the unprecedented conditions prevailing in the global financial and economic sectors,” he added.
Having dealt with the terror factor today, markets should return to business as usual next week, driven by fundamentals, analysts said.