Bulls are in no mood to give up. The benchmark Sensex crossed the 5,200 level on sustained buying in pharma, banking, capital goods and oil and gas stocks. Bank stocks, led by UTI Bank, sky-rocketed after the HSBC announced acquisition of 20 per cent stake in UTI Bank. The BSE Sensex gained 35.82 points to settle at 5,221.90, a 43-month closing high. The National Stock Exchange S&P CNX Nifty index gained 12 points to 1,670.50. Sensex moved in a wide 68-point range (between 5,246.74 and 5,178.22) during intra-day trades. The market breadth was quite strong with two gainers for every loser. However, volumes were lower. With today’s 35.82 point rise, Sensex has gained a whopping 451 points, or 9.4%, in just 8 trading sessions. A rally in the US markets, the recent peace initiatives between India and Pakistan and exit polls showing that BJP would win Assembly elections in Madhya Pradesh by a thumping majority has led to a sharp rally on the bourses over the last few days. Meanwhile, FII inflows continued to drive the market rally. FIIs have once again stepped up buying. As per data released by Sebi, FIIs pumped in Rs 286 crore on Tuesday, compared to the inflow of Rs 563.40 crore on Monday. With this, cumulative FII inflow in 2003 has crossed the Rs 30,000-crore-mark. Bank shares surged after global banking major HSBC announced the acquisition of a 14.7% stake in UTI Bank. UTI Bank soared 20% to Rs 114.10 —its maximum permissible level of the day. ICICI Bank (up 8.7% to Rs 287.50) was the star gainer. The scrip hit a 52-week high of Rs 290.50 during intra-day trades. HDFC Bank also gained 3.2% to Rs 328.70. A host of small private sector banks also surged. Global Trust Bank gained 18% to Rs 25.70, Karnataka Bank added 13% to Rs 97.95, United Western Bank surged 10% to Rs 30.80, IDBI Bank jumped 8.5% to Rs 35.50, while IndusInd Bank gained 8.4% to Rs 40.30. Dealers said players are also accumulating bank stocks on expectation that the government would raise the FDI limit in private banks to 74% (from 49%), and also allow proportionate (to shareholding) voting rights in foreign and private sector banks. As of now, voting rights are limited to 10%, regardless of the shareholder’s stake in the private sector bank. Analysts feel the removal of the 10% voting cap would effectively clear the path for mergers and acquisitions among private sector banks. The BSE banking sector index Bankex surged 92.30 points, or 3.7%, to 2,547.96.
