The benchmark S&P BSE Sensex continued to rule firm for the fourth consecutive week, surging 191 points to close above 20,000 level at more-than 1-1/2-month high of 20,149.85 on persistent buying.
The buying activity was mainly in FMCG, Refinery and IT sectors amid government’s decision to liberalise foreign direct investment norms in some sectors coupled with good corporate results.
Good Q1 results from Infosys, TCS and HDFC Bank further boosted the market sentiment. Positive global cues and good rainfall also aided the firm trend.
At the beginning of the week, Sensex resumed lower at 19,926.10 and dropped further to a low of 19,649.58 on heavy selling as the Reserve Bank of India (RBI) took various steps to tighten liquidity in a bid to curb rupee volatility.
Meanwhile, inflation based on the wholesale price index accelerated to 4.86 per cent in June from 4.7 per cent in May, according to government data.
Banking stocks fell sharply as the RBI fined 22 banks for violating KYC/anti-money laundering norms. The Reserve Bank’s latest measures would spark an interest rate increase, besides making it costlier for lenders and financial companies to raise short-term funds.
However, market recovered afterwards to a high of 20,256.60 before ending at 20,149.85, showing a rise of 191.38 points or 0.96 per cent as Prime Minister Manmohan Singh promised to unleash more FDI reforms and push infrastructure initiatives to boost growth. It has gained 1,375.61 points or 7.33 per cent in four weeks.
The NSE 50-share Nifty also moved up by 20.20 points or 0.34 per cent to 6,029.20. It has also hardened by 361.55 points or 6.38 per cent in last four weeks.
Finance Minister P Chidambaram said measures by the apex bank have nothing to do with the upcoming monetary policy review and may not impact interest rates of banks.
Hindustan Unilever (HUL) was the top gainer in the Sensex pack as it surged by 14.17 per cent on reports that the company has raised prices of several personal care products.
Tata Consultancy Services was the second top gainer, climbing 8.45 per cent after it posted a better-than-expected 15.5 per cent increase in consolidated net profit for the first quarter.
Overall, 16 scrips from the Sensex pack closed in the green while others finished in the red. Other major gainers from the Sensex pack were Bharti Airtel (8.23 per cent), ONGC (6.75 per cent), ITC (5.49 per cent), Bajaj Auto (5.32 per cent), Wipro (4.06 per cent), RIL (3.77 per cent), Hero Honda (3.72 per cent), Gail India (3.37 per cent) and Tata Power (3.30 per cent).
However, ICICI Bank dropped by 9.69 per cent followed by Tata Steel 8.28 per cent, BHEL 7.50 per cent, Sterlite Ind 6.17 per cent, HDFC 5.45 per cent, Jindal Steel 5.22 per cent and SBI 4.19 per cent.
Among the sectoral indices, S&P BSE-FMCG rose by 7.10 per cent followed by S&P BSE-Oil&Gas 4.11 per cent, S&P BSE-IT 3.98 per cent and S&P BSE-Teck 3.87 per cent while S&P BSE-Bankex dropped by 6.23 per cent followed by S&P BSE-Realty 4.08 per cent, S&P BSE-Metal 3.47 per cent, S&P BSE-CG 2.19 per cent and S&P BSE-Power 1.28 per cent.
Shares of small-cap and mid-cap also declined due to selling pressure from retail investors as indices fell by 0.91 per cent and 0.53 per cent and underperformed the Sensex.
The total turnover at BSE and NSE rose to Rs 9,411.92 crore and Rs 57,586.28 crore from the last weekend’s level of Rs 7,919.80 crore and Rs 46,408.59 crore.
Meanwhile, foreign institutional investors (FIIs) were the net sellers of Rs 352.24 crore including the provisional figure of July 19