Sensex jumps 495 points

MUMBAI, 17 JULY: Wiping out the huge deficit of last week, stock markets closed with spectacular gains today. Bulls have been aggressive throughout the week because of positive global cues and widespread revival of monsoon. The bellwether Sensitive Index of the Bombay Stock Exchange increased 1,240.70 points or 9.19 per cent this week. It closed today at 14,744.92 points, up 3.47 per cent or 494.67 points over its previous close. The NSE posted a weekly increase of 371.05 points or 9.27 per cent closing for the week at 4,374.95 gaining 143.55 points or 3.39 per cent.
Dalal Street responded with a warm welcome to three factors this week: good rain prospects, the government’s assurance on dilution of its stake in public sector undertakings and positive earning reports from America where Wall Street seems to have turned corner as Dow Jones did well.
In the previous week, stocks took a sever hammering with all frontline shares falling sharply. The dismal outlook changed drastically this week because of several positive domestic and global events. However, analysts said foreign funds did furious short-covering this week and earned impressive profit. They have been less active this week when big domestic investors such as LIC, GIC or companies such as Reliance ~ the market leader ~ also played a major role in lifting the market sentiment.
The 30-share Sensex of BSE started at 14,325.58 points with a modest positive gap of 75.33 points. It surged mostly in the second half of Friday’s business session and peaked to 14,800.70. It ended the day a shade below. The major contributors to the rally included auto, bank and realty shares. During the week all BSE sectional indices performed well with increases of more than five per cent. Reliance dominated Friday’s trading although its closed with a small loss.
Analysts say the markets are yet not safe for individual investors despite bulls turning aggressive. It remains a "big money" market since values are too high for smaller investors to risk their wealth. Foreign funds and big domestic investors have booked around 10 per cent to 20 per cent profit this week mostly in frontline stock deals. Analysts say this should not be construed as the return of foreigners. The FIIs will try to recover their recession period losses as fast as they could, they predict.
Friday’s trade in Sensex shares was Rs 2,116.74 crore in turnover as 28 stocks advanced and two declined. The top gainers included Mahindra at Rs 778.65 (8.07 per cent), Tata Motors Rs 316 (6.68 per cent), Hero Honda Rs 1,638.10 (6.49 per cent), Reliance Infra Rs 1,150 (8.44 per cent) and ICICI Bank Rs 742.45 (6.82 per cent). link....