Mumbai: The market snapped a three-day losing streak on Tuesday, supported by index heavyweight Reliance Industries. Buying in banks, FMCG, metals, auto, power and pharma stocks led the short covering rally in late trade.
The Sensex rose 132.16 points, to close at 16,002.51 and the Nifty closed at 4,800.60, up 36 points.
It seems that the market priced in all negatives on domestic and global front. Now, it is waiting for the RBI policy to be scheduled on Friday. Experts expect some cut in the cash reserve ratio after disappointing industrial output data announced on Monday.
The rupee touched a record low of 53.69 to the dollar on Tuesday, though it recovered to 53.21 a dollar (at the time of closing of Indian equities), down 36 paise. Ssharad D Pawaar, CEO of SPFX INDIA feels that the rupee will touch 54 by year end.
"The Rupee is expected to remain under pressure on the worsening overseas and the domestic economic conditions. It appears that the European nations have half heartedly tried to deal with the Eurozone debt crisis. However, the growing concerns about the future of the Eurozone economy are likely to weigh on the Rupee.
Major largecap Reliance Industries gained 2 per cent after sources claimed that the Directorate General of Hydrocarbons proposed formula for curbing RIL KG-D6 cost recovery. According to DGH formula, USD 1.235 billion of RIL cost be disallowed' in FY12-13, says sources.
Jindal Steel and Hindalco topped the buying list, rising 4-4.8 per cent. Other metal stocks like Tata Steel, Sterlite and Coal India moved up 1.3-1.6 per cent.
Among others, Infosys, HDFC Bank, ITC, Bharti, SBI, HUL and BHEL were up 0.8-1.5 per cent.
However, capital goods major L&T dropped nearly 2 per cent on slowdown concerns. Expressing concerns about the slowdown, AM Naik, CMD, L&T said that business confidence is significantly hurt while the power division has been worst hit. Unhappy with government’s inaction, Naik emphasized that coal block issues could have been resolved in weeks.
ONGC, ICICI Bank, Maruti and Wipro were down 0.3-0.8 per cent.
The broader markets underperformed benchmarks - the BSE Midcap Index was down 0.6 per cent and Smallcap down 0.7 per cent.
Declining shares outnumbered advancing by 1624 to 1139 on the BSE.
On the global front, European markets like France's CAC, Germany's DAX and Britain's FTSE were trading 0.2-0.5 per cent higher.
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