Sensex up 100 pts on strong global mkts,slip in food inflation

Mumbai, Sept 8 (PTI) After volatile movements, the BSE
Sensex gained for the third day in a row -- up over 100 points
at 17,165.54 -- as investors bought blue chips such as RIL and
Infosys amid strong global stock markets and a slight fall in
food inflation.
The Bombay Stock Exchange 30-share benchmark index opened
higher on firm Asian cues but fell to a low of 16,987.37 after
the government auditor CAG submitted a report on RIL and late
profit booking in the Asian markets.
The Comptroller and Auditor General (CAG) sharply
criticised Reliance Industries Ltd and the oil ministry for
violation of contract over KG-D6 gas block and called for
revamping the current profit-sharing arrangement, which
reduced government revenues.
However, firm openings in European markets, easing of
food inflation and a smart rebound in RIL helped Sensex to
turn positive and close at 17,165.54 -- a net gain of 100.54
points or 0.59 per cent.
"RIL dipped heavily in the early session after the final
CAG report was tabled in Parliament on Hydrocarbon Production
Sharing Contracts (PSC)," said Kishor P Ostwal, CMD of CNI
Research.
"However, operators took this opportunity to cover their
short positions and play safe ahead of the US president Barack
Obama's speech on jobs creation proposals as well as European
Central Bank (ECB) and Bank of England's monetary policy
meeting today," he added.
RIL rallied and closed 2.62 per cent up and was the
second top gainer from the Sensex pack, contributing over 45
points to the rise.
Besides, other heavyweights like ICICI Bank, Infosys,
L&T, Tata Motors and HUL closed with smart gains and aided the
rally.
The broader NSE 50-issue Nifty also strengthened by 28.60
points or 0.56 per cent to 5,153.25.
Software stocks attracted good buying support as falling
rupee has boosted revenue outlook for IT firms. Over 90 per
cent of their revenues come from exports to the US and Europe.
Globally, Asian stocks reversed initial gains on late
selling and closed narrowly mixed. Key indices in Japan,
Singapore, South Korea and Taiwan finished with gains, while
those in China and Hong Kong ended with losses.
European markets showed a strong trend in the afternoon.
The CAC was up about 1.0 per cent, the DAX by 0.9 per cent and
the FTSE by 0.8 per cent.
Back home, food inflation returned to single digit at
9.55 per cent for the week ended August 27, from 10.05 per
cent in the previous week. Investors have been worried about
further hike in interest rates in view of high inflation. Any
slide in overall inflation or food inflation, tends to raise
hopes of a moderation in interest hikes by the Reserve Bank.
In all, 15 of the 30 Sensex-based shares ended with gains
while others settled with losses. Cipla was the top gainer, up
2.94 per cent, followed by Tata Motors (2.59 pc), Wipro (2.58
pc), ICICI Bank (2.51 pc), Infosys (2.07 pc), L&T (1.48 pc)
and HUL (1.47 pc).
However, Jindal Steel fell 1.57 per cent, Coal India
(1.35 pc), Tata Power (1.34 pc), Tata Steel (1.05 pc), BHEL
(0.97 pc), Bharti Airtel (0.96 pc), HDFC (0.91 pc), HDFC Bank
(0.79 pc) and ITC (0.60 pc).
Among sectoral indices, BSE-Consumer Durables rose 1.99
per cent, IT (1.52 pc) and Oil&Gas (1.42 pc), while Metal
eased by 0.69 per cent.
The total market breadth at BSE remained favourable as
1,733 stocks ended in the green, while 1,099 finished in the
red. The total turnover declined further to Rs 2,699.05 crore
from Rs 2,757.35 crore yesterday. PTI SA
RCJ