Oct 10, 2008

Up, Up and away

19 Sep 2008 | 18:27
Up, Up and away

It was a spectacular session for the Indian markets as they rose through out the day. The gains came on the back of strong global cues on hopes that the US government is on the way to consider a comprehensive plan to rescue financial firms from the debt trap situation and to end this credit crisis running for more than 10 months. US markets received a further boost on the announcement that the US market regulator SEC had halted short-selling of financial stocks in the US.

Asian markets too were sharply up as the Shanghai gained 10% in today's trade followed by Hang Seng with a gain of 9.61% at close. The Nikkei was up 3.76%. European shares surged higher as the FTSE was up nearly 8%. This was the index’s biggest rally ever after the news that UK financial regulators had also temporarily banned the short-selling of some financial stocks.

All this positive sentiments led to the BSE Sensex turning back above the 14,000 levels. The Sensex finally closed 726.72 points or 5.46% higher at 14,042.32. The Nifty gained 207.1 pts or 5.13% to close at 4245.25. The broad market indices also participated in the rally though they did not gain as much as the main indices. The BSE Midcap and
Smallcap indices rose 2.95% and 2.31% respectively. Market breadth was positive as A/D ratio was
2.55:1 on the BSE. NSE cash turnover was Rs.16,294crs. Vs. Rs.16,088crs. on Thursday.

All the sectoral indices ended with gains. The top gainers were the BSE Realty, IT, Oil and Gas, Power and Bankex. Top Gainers from the BSE-30 were Satyam, ICICI bank, HDFC, Tata Power and DLF. There were no losers from the BSE-30.

After recovering from the 12,500/3800 levels yesterday, the main indices have moved further up and closed below some important resistances. Traders would need to watch if the Nifty can cross the 4300 resistance levels. A move above these resistances could lead to a testing of the 4400-4500 levels. On the other hand, a failure to cross these resistances could lead to the markets drifting lower once again and testing the 4000-3800 levels once again. Markets are therefore likely to remain volatile with the Nifty trading between the 3800-4500 levels in the coming week.