Business
Sensex surges most in 21 months after budget
Sensex surges most in 21 months after budget
March 01, 2011 | 12:00 AM
Bloomberg/Mumbai
India’s stocks rose the most in 21 months after the government unveiled its annual spending plan, pledging to trim the deficit and curb inflation.
Mahindra & Mahindra Ltd, a sport-utility vehicle maker, advanced the most since July 2009 after posting a 20% gain in sales last month.
The budget announced on Monday was "marginally positive for banks and autos,” Credit Suisse Group AG said yesterday. Manufacturing expanded at the fastest pace in three months, a report showed today. Larsen & Toubro Ltd, the largest engineering company, jumped 5.5%.
The Mumbai Stock Exchange Sensitive Index, or Sensex, gained 623.10, or 3.5%, to 18,446.50 at the 3.30pm close in Mumbai, its steepest climb since May 2009. The S&P CNX Nifty Index on the National Stock Exchange rose 3.5% to 5,522.30, while its April futures settled at 5,558.55. The BSE 200 Index increased 3.4% to 2,260.12. India’s markets are closed tomorrow for a public holiday.
"The event is behind us and hasn’t really thrown any negative surprises,” said Sunil Pachisia, vice-president at Mumbai-based brokerage Pratibhuti Viniyog Ltd. "People who restrained from buying ahead of the budget are cashing in now.”
India will narrow its deficit to 4.6% of gross domestic product in the year to March 2012, Indian Finance Minister Pranab Mukherjee said in his annual budget speech in parliament on Monday. Spending on roads, ports and other large projects will increase by 23% in the year from April, he said.
A measure of India’s manufacturing output stood at 57.9 in February, according to the Purchasing Managers’ Index compiled by HSBC Holdings and Markit Economics that was released today. A reading over 50 indicates expansion. The gauge was at 56.8 in January.
Mahindra surged 7.9% to Rs664.3. Tata Motors Ltd, the biggest truckmaker, gained 5.5% to Rs1,141.85 after saying February sales climbed 12% from a year earlier.
The rupee gained the most in three months as economic reports bolstered confidence in the global economic recovery and crude oil prices retreated, helping lower the nation’s import bill.
"The rupee’s push higher in the near term is down to oil prices,” said Nick Verdi, a foreign-exchange strategist at Barclays in Singapore. "While oil prices rose significantly in the past weeks, markets seem to think it won’t yet significantly impact the global economy. So, we are seeing a bit of risk taken back on in Asian currencies.”
The rupee rose 0.7% to 44.9450 per dollar as of the 5pm close in Mumbai, according to data compiled by Bloomberg. Earlier, it touched 44.9150 per dollar, the highest level since January 4.
The currency strengthened 1.4% in February and, based on the median forecast of economists surveyed by Bloomberg, will advance a further 2.6% this year to 43.80.
| An Indian share broker looking at her computer screen. The Bombay Stock Exchange’s Sensitive Index, or Sensex, gained 623.10, or 3.5%, to 18,446.50 at the 3.30pm close in Mumbai yesterday |
Mahindra & Mahindra Ltd, a sport-utility vehicle maker, advanced the most since July 2009 after posting a 20% gain in sales last month.
The budget announced on Monday was "marginally positive for banks and autos,” Credit Suisse Group AG said yesterday. Manufacturing expanded at the fastest pace in three months, a report showed today. Larsen & Toubro Ltd, the largest engineering company, jumped 5.5%.
The Mumbai Stock Exchange Sensitive Index, or Sensex, gained 623.10, or 3.5%, to 18,446.50 at the 3.30pm close in Mumbai, its steepest climb since May 2009. The S&P CNX Nifty Index on the National Stock Exchange rose 3.5% to 5,522.30, while its April futures settled at 5,558.55. The BSE 200 Index increased 3.4% to 2,260.12. India’s markets are closed tomorrow for a public holiday.
"The event is behind us and hasn’t really thrown any negative surprises,” said Sunil Pachisia, vice-president at Mumbai-based brokerage Pratibhuti Viniyog Ltd. "People who restrained from buying ahead of the budget are cashing in now.”
India will narrow its deficit to 4.6% of gross domestic product in the year to March 2012, Indian Finance Minister Pranab Mukherjee said in his annual budget speech in parliament on Monday. Spending on roads, ports and other large projects will increase by 23% in the year from April, he said.
A measure of India’s manufacturing output stood at 57.9 in February, according to the Purchasing Managers’ Index compiled by HSBC Holdings and Markit Economics that was released today. A reading over 50 indicates expansion. The gauge was at 56.8 in January.
Mahindra surged 7.9% to Rs664.3. Tata Motors Ltd, the biggest truckmaker, gained 5.5% to Rs1,141.85 after saying February sales climbed 12% from a year earlier.
The rupee gained the most in three months as economic reports bolstered confidence in the global economic recovery and crude oil prices retreated, helping lower the nation’s import bill.
"The rupee’s push higher in the near term is down to oil prices,” said Nick Verdi, a foreign-exchange strategist at Barclays in Singapore. "While oil prices rose significantly in the past weeks, markets seem to think it won’t yet significantly impact the global economy. So, we are seeing a bit of risk taken back on in Asian currencies.”
The rupee rose 0.7% to 44.9450 per dollar as of the 5pm close in Mumbai, according to data compiled by Bloomberg. Earlier, it touched 44.9150 per dollar, the highest level since January 4.
The currency strengthened 1.4% in February and, based on the median forecast of economists surveyed by Bloomberg, will advance a further 2.6% this year to 43.80.
March 01, 2011 | 12:00 AM