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IT's 12,000 & Counting

Strong quarterly numbers, continuity in monetary policy

Stocks on India bourses rose on back of hectic buying in IT and metal stocks in the week ended April 21, 2006. The 30-stock BSE Sensex rallied nearly 800 points through the week to close 7.06 per cent up at 12,030 levels. The Nifty too added 6.80 per cent to sign off the week at 3,573 mark. Among the broader indices, S&P CNX 500 closed up 5.21 per cent, while CNX Midcap index rose 4.39 per cent.

Stocks had a ballistic start on Monday. The Sensex rose 302 points on expectations of robust earnings from software firms. Infosys zoomed nearly 7 per cent after it reported a 21 per cent rise in quarterly net profit and forecast better earnings in days to come. TCS too rose 6 per cent. Another major gainer was Gujarat Ambuja Cements which saw price appreciate more than 8 per cent.

Equity markets continued their surge ahead on Tuesday. This time, the trigger was no change in short-term interest rates by the RBI. The central bank said inflation expectations were contained for the time being. The news cheered banks, with the BSE Bankex rising 1.43 per cent, 282 points, on Tuesday. IT stocks continued rising with TCS announcing a 72 per cent jump in quarterly profit - the stock rose 5.7 per cent.

Wednesday was no different. The news of Standard & Poor's outlook on India's sovereign credit rating to positive from stable and good numbers declared by companies strengthened the rally, though the mood was choppy through the day. The Sensex added 74 points over the day.

Thursday proved to be yet another historic day for the markets with the Sensex closing past 12,000 levels. The index rose 143 points to close at an all-time high of 12,040 mark. Positive sentiments created by strong quarterly earnings and robust foreign fund inflows fueled the rally. Reliance Industries rose 8 per cent on news that it had struck oil off India's eastern coast.

Markets closed flat on Friday after choppy trades through the day. Under pressure from profit booking, the 30-stock BSE Sensex closed nine points down at 12,030 levels.

Among the 30 Sensex stocks, only NTPC ended the week down 1.34 per cent. Seven stocks managed double-digit return. The pack of gainers was led by over 15 per cent rise in Tata Steel and Reliance Industries.

Among the sectoral indices, BSE Metal continued to race ahead with gains of 9.96 per cent. BSE IT and BSE FMCG rose 7.38 and 4.31 per cent, respectively.

The combined daily average turnover on BSE and NSE fell by 9.11 per cent to Rs 14,601 crore in the week ended April 21. The FIIs pulled nearly Rs 958 crore, while domestic mutual funds pumped in Rs 524 crore over the week.