The Telegraph
Since 1st March, 1999
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Index tops 12000, Reliance fuels rally

Mumbai, April 20: The sensex roared past 12000 ' and stayed atop that peak today as the bulls rampaged through Dalal Street, redolent of Pamplona’s famed Sanfermin fiesta.

The 30-scrip sensex gained 143.57 points or 1.2 per cent to settle above the 12,000 mark for the first time. It ended the day at a lifetime closing high of 12039.55, after hitting an all-time peak of 12,053.74 during the trading session.

It took the bellwether index just 19 trading sessions to reach 12,000 after it had first hit 11000 on March 21, making it the fastest 1000-point rally. The sensex has taken 48 trading sessions to reach 12000 from 10000.

“The latest rally in the market from 11000 to the 12000 level has been mostly contributed by Reliance Industries. The scrip alone accounted for almost 250 points as the stock appreciated by 27 per cent during the period,” said V.K. Sharma of Anagram Stock Broking.

The dominance of RIL in today’s surge was evident as 18 out of the 30 sensex stocks traded in the red. The scrip has a near 10 per cent weightage in the index.

“Also, the bullishness in international commodity prices saw the metal stocks soaring in the latest surge. Almost all the metal stocks like Hindalco and Tata Steel are doing well. RIL has also gained on soaring crude prices,” said Sharma.

RIL surged 8 per cent to close the day at Rs 994.90 after touching a high of Rs 999.95 during the trading session. Sixty-three lakh shares of the company changed hands on the bourses.

Tata Steel hit its 52-week high price of Rs 646.95 before settling at Rs 644.05 with a gain of 5.76 per cent and a turnover of 34 lakh shares.

Hindalco ended the day with a gain of 5.76 per cent at Rs 215.55. Madras Aluminium clocked a gain of 9.99 per cent at Rs 503.5, also a 52-week high for the scrip.

However, market watchers feel that the liquidity in the market is not as comfortable as earlier with the foreign institutional investors turning net sellers in the market. For the month till April 19, they have sold Rs 1,796.7 crore worth of shares. BSE clocked a turnover of Rs 5,013 crore against yesterday's Rs 5,297 crore.

The current drivers in the market are the mutual funds and the domestic players, said Sharma. With the huge collections made by the new fund offers along with fresh money flowing into the existing equity funds, mutual funds have turned net buyers since March.

The funds were net sellers for the months of January and February, as opposed to the FIIs, but have turned net buyers since March. For the month till April 19, the funds have bought shares worth net Rs 1,364.99 crore.

“The stock market, which would have witnessed a correction has been given a longer lease of life with the commodity prices, which appears to be sustainable," said Sharma.

“However, the FIIs will continue to be reluctant players till they get specific cues like stable interest rates and rupee appreciation. They will be back with a vengeance once a major correction comes about,” added Sharma.

Meanwhile, the government today said there was no fear of a stock bubble in the capital market, as the benchmark sensex crossed 12000 points for the first time.

“I don't think there is any bubble (in the stock market),” a top finance ministry official said.

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