Tuesday February 26, 03:30 PM
Sensex crosses 3,700... |
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By Equitymaster.com
The bourses closed up sharply backed by hectic buying in tech stocks. Old economy pivotals in commodities, PSUs, FMCG also spurred sentiment. The bourses seem to be building up expectations pre-budget, much in line with what has happened in the previous years. So one cannot say whether the sentiment will sustain or not.
The BSE Sensex closed at 3,712 (up 88 points) and the NSE Nifty closed at 1,189 (up 24 points). The rupee was trading at Rs 48.77 per US dollar.
With the rise in the U.S markets, investors got into domestic tech counters. This sector seemed dominated by day traders. Among the gainers were Infy (2.7%), Sify (6%), Digital (2.6%), Polaris (2%), VisualSoft (5%) and HCL (HCLL.BO, news) Tech (3.4%).
Hike in freight tariff in the railway budget is likely to put pressure on margins for companies like Tisco and SAIL. This is due to the fact the these companies have plants located in eastern and central India, which are far away from the major market, the western part of India. Sail was down by over 3% at the end of day, while Tisco was marginally in the red. Essar that has a plant in Surat is less likely to be affected by this. After rising by over 3% in the morning, the stock retraced its steps to close at more or less yesterday's levels.
Nestle SA of Switzerland (parent company of Nestle India) is seeking approval from the government to acquire upto a further 10% stake through creeping acquisition route. Nestle SA already holds 54% stake in Nestle India. The stock finished up by 2%.
Gillette India finished up over 16% on news that its parent, Gillette, USA, is planning to infuse US$ 20 m (about Rs 1 bn) in its Indian arm. Keeping in view the long-term financial position of the Indian subsidiary and to help its debt commitments, the parent has decided to invest these funds. The fund infusion is not towards capital contribution by the parent. Consequently, Gillette India will not have to pay any interest on these funds.
Commodity stocks, largely aluminium stocks like Hindalco (HALC.BO, news) , Nalco and Indal were strong today. PSU counters also spurred up on divestment hopes. MTNL (MTNL.BO, news) finished up 10%.
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