Truce between Ambani brothers fueled the stock markets rally in the week ended June 24, 2005. While the 30-stock BSE Sensex surged 242 points to close at an all-time high of 7148.62 on Friday, the Nifty advanced 71 points to 2194.35 mark.
The stock markets had an auspicious start on Monday. Positive sentiments after the truce between Ambani brothers helped the Sensex zoom past the historic 7,000 points mark. Massive buying interest in the stocks of Reliance pack, supported by rally in the technology scrips contributed to the surge. While the Sensex touched an all-time high of 7,001.55 before settling at 6,984, the Nifty too added 20 points to close at 2,144 mark. Reliance Capital was one of the favourites of investors after Anil Ambani announced investment of Rs 3,000 crore in Reliance Capital and Reliance Energy. Technology stocks, led by software major Infosys, also boosted the market sentiments.
Massive buying interest pushed the equity markets further up on Tuesday. The Sensex breached the 7,050-point mark to finally settle at 7076.52, up nearly 92 points from its previous close. The Nifty too surged nearly 26 points to close at 2,170. Technology, steel, auto, banking, pharma, cement, engineering and infrastructure stocks saw a lot of activity. Among the index heavyweights Cipla, Gujarat Ambuja Cements and ICICI Bank were the top three gainers.
Markets gained for the third consecutive day on Wednesday. Sensex crossed the psychologically crucial 7,100 mark to close at 7,145, up by 69 points, while Nifty closed at 2,187. Despite crude prices hovering at higher levels of $59 per barrel, the sentiments remained positive, and a broad-based rally saw the markets scale new peaks. After the Reliance pack, it was the turn of cement and auto stocks to post impressive gains. Maruti rose by more than 3 per cent, while Tata Motors, ACC and Gujarat Ambuja also recorded smart gains, each of them gaining over 1 per cent. The onset of monsoon propelled FMCG stocks, ITC gained over 2 per cent.
The dream run though paused for a breather on Thursday. Index heavyweights dragged the 30-stock BSE Sensex down 0.36 per cent to 7119.76 points. The Nifty too shed 0.16 per cent to close at 2183.90 mark. Markets were in correction mode since morning trading with the Sensex opening lower at 7142.91 points. Technology stocks traded weak on Thursday. Prominent Sensex losers included Infosys, RIL, HDFC Bank and TCS. Hero Honda Motors, though, gained nearly 5 per cent. Banking major SBI and Bajaj Auto surged over 3 per cent each.
However on Friday, equity markets staged a strong comeback in the afternoon session. At the end of the day, the 30-stock BSE Sensex gained 29 points to close at 7148.62 mark. The Nifty added 10.50 points to end the day at 2194.35. Midcap stocks too were in action, as the CNX Midcap 200 surged 0.74 per cent. Aluminium, auto ancillaries, auto, fertilizers, engineering, and FMCG stocks trigged today's rally. Among the index heavyweights, HLL and Hero Honda led the pack of gainers with gains of 5.29 and 3.75 per cent, respectively.
Among the broader indices, S&P CNX 500 closed up 2.52 per cent, while CNX Midcap 200 gained 0.79 per cent.
Moving to the Sensex constituents, Cipla, Hero Honda Motors and HLL led the pack of gainers with gains of over 9 per cent each.
Among the sectoral indices, BSE FMCG index surged 5.08 per cent on hopes that the revived monsoon would lead to higher income in rural India. Pharma stocks too were in action. The BSE Healthcare index gained 3.66 per cent. Ranbaxy moved up 5.50 per cent after it announced that it had received approval from the US Food and Drug Administration to manufacture Terbinafine Hydrochloride tablets. Metal and select technology stocks too attracted buying interest.
The combined daily average turnover on both exchanges went up by a massive 39.65 per cent Rs 9.092 crore.
Foreign institutional investors were in action throughout the week--they invested Rs 2,942 crore. Mutual funds, though, booked profits worth Rs 1085 crore.
Outlook
With more FII money expected to be invested in the Indian markets, we may see yet another positive week. It would be interesting to see how mutual funds behave in the coming week, as they are maintaining heavy cash positions. Many new funds are yet to deploy the money raised during initial offers. Hope of a renewed monsoon too is likely to provide strength.
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