Date:04/07/2009 URL: http://www.thehindu.com/2009/07/04/stories/2009070456361600.htm

Business

Railway budget peps up market

Sensex gains 255 points on partial recovery in global stocks

MUMBAI: After a few days of dull trading, shares on the Bombay Stock Exchange shot up on Friday following the presentation of Railway Budget, with the benchmark Sensex soaring by 255 points on heavy buying by foreign funds and partial recovery in global stocks.

The market welcomed the initiatives in the Railway Budget, including plans to improve infrastructure.

Leading foreign institutional investor and mutual fund, HSBC, reportedly bought aggressively in the last one hour of trading, leading to a sharp surge in the market.

Touching a low of 14499.74, the BSE 30-share barometer later bounced back and closed at 14913.05, a net gain of 254.56 points or 1.74 per cent over its previous close.

Market sentiment was boosted by intra-trade recovery in Asian and European stocks. Disappointing U.S. jobs data weighed on the global stocks at the outset.

Back home, despite a populist budget with no change in freight rates and passenger fares, rail-related stocks pared early gains as investors booked profits in these shares.

Foreign institutional investors (FIIs) have been net buyers, albeit in moderate quantity, in equity this week and bought shares worth Rs. 1,864.60 crore between June 29 and July 3.

The broader 50-share Nifty of the National Stock Exchange rose by 75.40 points or 1.73 per cent to close at 4424.25. Bank stocks attracted brisk activity, pushing up the BSE Bankex by 2.19 per cent on expectations of major reforms in the financial sector. The market breadth was positive with 1,341 gainers against 1,263 losers on the BSE.

Rupee recovers

The rupee recovered from early losses and ended marginally higher at 47.89/91 a dollar on Friday on hopes of persistent capital inflow from foreign institutional investors in view of rising trends in equity markets.

It closed at 47.95 on Thursday.

The stock market spiralled upwards after the presentation of the Railway Budget. The domestic currency resumed lower at 48.10/12 fell further to 48.19 before recovering at 47.89/91. — PTI