US Fed,Diesel hike lift Sensex 372 pts

Sensex shot up to 18,456.33 before quoting at 18,392.95 at 1030 hrs,up 371.79 pts.

Written by Agencies | Mumbai | Published:September 14, 2012 9:43 am

The BSE benchmark Sensex rallied by 372 points to its highest level in nearly 7 months today on all-round buying triggered by strong global cues following US Fed steps to bolster economic growth and capital inflows.

Besides,a steep hike of Rs 5 a litre on heavily subsidised diesel by the Cabinet Committee on Political Affairs (CCPA) yesterday to bring down the burgeoning fiscal deficit bolstered investor sentiment.

The BSE 30-stock index,Sensex,resumed higher at 18,284.75 and shot up further to 18,456.33 before quoting at 18,392.95 at 1030 hrs,up 371.79 pts or 2.11 per cent.

The NSE 50-share Nifty also rose by 114.60 points or 2.11 per cent to 5,549.85 at 1030hrs.

Major gainers were Hindalco (5.03 pc),ICICI Bank (4.62 pc),SBI (4.26 pc),Tata Motors (4.21 pc),Tata Steel (4.16 pc),Jindal Steel (4.15 pc),Sterlite (3.82 pc),Gail India (3.36 pc),Maruti Suzuki (3.32 pc),Tata Power (3.04 pc) and RIL (2.52 pc).

Asian stocks made gains in the early trade after the US Federal Reserve announced an aggressive new stimulus plan to revive growth in the world’s largest economy.

Key indices in Japan,South Korea,Singapore,Taiwan China,Hong Kong and Indonesia gained by up to 2.67 per cent.

US markets surged yesterday after the Fed announced to buy back USD 40 billion worth of mortgage securities per month,to keep borrowing rates low.

The Dow Jones Industrial Average ended up 206.51 points or 1.55 per cent and the Nasdaq Composite index gained 41.51 points or 1.33 per cent.

GLOBAL MARKETS

Nifty futures on Singapore Exchange rose 2 percent while the MSCI-Asia Pacific index excluding Japan rose 2.3 percent.

U.S. stocks surged to multi-year highs on Thursday after the Federal Reserve announced an aggressive plan to stimulate the economy,encouraging investors to dive back into the market.

Risk assets from Asian shares to commodities rallied while the dollar slipped further on Friday as markets digested the Federal Reserve’s aggressive new stimulus to drive job creation in the U.S. Economy.

FACTORS TO WATCH

India’s August wholesale price index is expected to have risen 6.95 percent from a year ago,compared to 6.87 percent in July. (Around 11 am-12 pm IST)

The Indian cabinet will consider a proposal to allow foreign airlines to buy stakes in local carriers at its weekly meeting.

India’s foreign reserves data. (1130 GMT)

INDIAN STOCKS TO WATCH

TOP NEWS

India raised the price of heavily subsidised diesel on Thursday to rein in its fiscal deficit and counter the threat of becoming the first of the big emerging economies to be downgraded to junk.

The Federal Reserve launched another aggressive stimulus program on Thursday,saying it would pump $40 billion into the U.S. economy each month until it saw a sustained upturn in the weak jobs market.

ENERGY/COMMODITIES

The government has decided to terminate mining licences of four coal blocks and will decide on Friday the fate of six blocks with reserves of 2.2 billion tonnes held by 14 firms,including Tata Steel,Hindalco Industries,Tata Power and Reliance Power. A senior coal ministry official said the three companies did not put up the associated end-use projects as required under law.

An Indian court ruling has cut the tax bill of Essar Oil ,a subsidiary of London-listed Essar Energy,by $327 million,in a development that the company said drew a line under its tax problems.

India has moved further away from a widespread drought with a third straight week of heavy rains and the weather office is now suggesting the crucial monsoon could even slow its retreat,helping winter planting in the major food producer.

TELECOMS

Russia’s Sistema JSFC is close to acquiring a controlling stake in Aircel Communications for around $3 billion,two people familiar with the development said. Malaysia’s Maxis Communications owns a 74 percent stake in Aircel through multiple entities,which are being consolidated into a single company.

AUTOS

Hero MotoCorp Ltd will increase its scooter production capacity by 50 percent to 60,000 vehicles a month and raise its production of 125cc motorcycles by 25 percent to 75,000 vehicles per month,the company said on Thursday.

The telecom department is likely to make three blocks of 1.25 MHz available as ‘top- p’ spectrum in all circles except Delhi and Mumbai for the upcoming auction,a senior official said.

PHARMA

Ranbaxy Laboratories Ltd has got the approval to set up a greenfield manufacturing facility in Malaysia. Ranbaxy said it will invest around $40 million in the project,and increase total output in Malaysia from 1 billion doses/annum to 3 billion doses/annum. (Reuters)

MEDIA

Deccan Chronicle Holdings have rejected the one takeover bid they have received for their Indian Premier League Deccan Chargers cricket,the country’s cricket board (BCCI) said on Thursday.

OTHER FACTORS TO WATCH

Indian debt/FX factors to watch

Fed easing saps dollar,euro hits 4-mth high

Brent crude rises above $116 on Fed stimulus action

Foreign institutional investor flows

For closing rates of Indian ADRs

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