Ambani truce bid, upbeat Aug IIP nos push Sensex above 17K

Mon, Oct 12, 2009
Source : Moneycontrol.com

The Nifty rallied over 100 points on the first day of the week and managed to recover 2/3rd of previous week's losses; it closed above the 5,050 level. Buying across all the sectors helped the Sensex to stay above the 17,000 mark at close; technology, banking and oil & gas exploration were the leading stocks in today's trade.
August double digit IIP (Index of Industrial Production) and Anil Ambani's attempt to end the tussle between both the brothers helped the markets throughout the session.

The August IIP number came in at 10.4% as against 7.2% last month. This high number could be a result of the low base effect set in August last year. M Govinda Rao, Director, NIPFP, expected industrial growth to now pick up. He saw the IIP figure clocking in above 10% through the rest of this year. He didn't see any room for hardening of interest rates at this stage.

April to August industrial growth also improved to 5.8% versus 4.8% (YOY). In IIP internals, manufacturing output was up to 10.2% versus 1.7%, Mining at 12.9% versus 2.8%, Electricity at 10.6% versus 0.8%, basic goods at 10% versus 3.9% and Capital goods at 8.3% versus 0.9% (YOY).

In what could be an end to Ambani gas tussle, younger brother Anil Ambani had made public announcement on Sunday to reconcile and resolve issues with brother Mukesh Ambani. He believed that disagreements could be sorted in a cordial manner. Reliance Industries surged 3.2% and Reliance Industrial Infrastructure up 3.5%.

In ADAG (Anil Dhirubhai Ambani Group) pack, Reliance Capital was up 4.7%, Reliance Infrastructure was up 5%, Reliance Natural Resources was up 5.3% and Reliance Power was up 2.6%. However, only Reliance Communication ended off day's low and was down just 0.62% post audited report.

The 30-share BSE Sensex shot up 384.01 points or 2.31%, to close at 17,026.67 and the 50-share NSE Nifty rose 2.21% or 109.05 points, to settle at 5,054.25. The broader indices did not move up in line with benchmark indices, up 1% each.