The Bombay Stock Exchange 30-share sensitive index (Sensex) closed above the psychological barrier of 19000-mark at 19058.15, up 188.46 points or one per cent. The rally was led by realty sector stocks which rose by 4.94 per cent, followed by consumer durables, banks , capital goods, power and oil and gas .However, stocks of automobile, information technology and health care ended in the negative territory. On the National Stock Exchange the S&P CNX Nifty closed at 5787.60 gaining 56.35 points or 0.98 per cent.
Recently, the market has been moving up on the back of foreign fund inflows, followed by a number ofmeasures such asforeign direct investment (FDI) in retail.However, concerns on the global financial scene persist. While the situation in the U.S. is stabilising, the European economy is still weak.
Furthermore, funding problems in Spain, Greece and Italy remain high. “The announcement of third quarter earnings by some corporates in the next week will provide more indications whether we are only in the middle or already at the end of the equity market rally,” said Jignesh Shah, Executive Director, Sarasin-Alpen (India) Private Limited.“The Sensex has closed above 19000 mainly on the wave of positive sentiment due to the reforms announced by the Government. Liquidity infused by foreign institutional Investors through consistent buying in the past few sessions has also played a part,” said K. Subramanyam, Assistant Vice-President (Institutional Research), Asit C. Mehta Investment Intermediates.
“We believe that a level of 20000 is likely by December if reform announcements continue. The immediate factor that will have a bearing on the markets is the corporate results which could determine fresh buying or selling opportunities,” Mr. Subramanyam added.
Meanwhile the rupee also surged ahead against the U.S. dollar on Thursday recording a five-and-a-half-month high, on the expectation of foreign fund inflows with the reforms.
The rupee closed at 51.74/75 a dollar, compared to its previous close of 52.155/165.