Business

IT stocks help Sensex recovery

MUMBAI: As the worst-ever terror attack in the financial capital is receding, the benchmark BSE 30-share Sensex gained 66 points on Friday to close for the week. The market opened after a day’s suspension of trading on Thursday following the terror attacks on strategic tourist centres in Mumbai.

However, the rupee lost against the U.S. dollar, as investors and importers rushed to cover the dollar due to terror attacks.

The Sensex opened down by 137 points, but recovered within minutes of trading. Among the 30 index-participants, 16 advanced while 14 declined.

The Sensex moved between 9157.62 and 8889.18. Information technology stocks helped Sensex recover.

The broad-based National Stock Exchange index Nifty improved 2.85 points to 2755.10 after moving between 2779 and 2,690.30.

“We do not see any long-term impact of the terrorist attacks on the economy or the capital markets though some weakness is likely in the near-term,” stated Edelweiss Research, an equity research firm.

The support for the indices came from the IT sector, which gained 3.67 per cent at 2558.94, as IT majors Infosys Technologies and Tata Consultancy Services rose smartly on declining rupee against the dollar.

Infosys rose by 4.49 per cent to Rs. 1,240.60 and TCS by 5.89 per cent to Rs. 558.05 on aggressive buying by funds. BSE tech index gained 2.45 per cent, auto 1.43 per cent, FMCG 0.82 per cent and Bankex 0.44 per cent. However, realty sector index was down by 0.97 per cent, metal 0.87 per cent and PSU 0.53 per cent.

Indian Hotels Company lost Rs. 8.25 or 17.03 per cent at Rs. 40.20 compared to its previous close of Rs. 48.45 on Wednesday. Mumbai’s Taj Hotel, which was under attack by the terrorists, is one of the premier properties of Indian Hotels.

Meanwhile, Asian markets gained: Japan’s Nikkei by 138.88 points and Hong Kong’s Hang Seng by 336.18 points. But European markets were mixed as U.K. gained marginally while French CAC 40 and German Dax lost 35.49 points and 32.01 points respectively.

Standard & Poor’s (S&P) Rating Services said it does not believe the terrorist attacks in India will have a direct effect on the sovereign ratings on India (BBB- (minus)/Stable/A- (minus)3), provided they are an isolated case.

The rupee opened 10 paise weaker and fell further against the U.S. dollar in early trading after re-opening of the inter-bank foreign exchange market on Friday, a day after the terror attacks shook the country’s financial capital.

The rupee which shed by 45 paise to close at 49.50 on Wednesday, depreciated further by 22 paise to 49.72 against the dollar in early trading.

It closed at 50.07/10. Further, heavy demand for the U.S. currency from importers also led to rupee’s depreciation.

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