Sensex ends above 17000 on global cues; all sectors gain
03 Jun 2010
The benchmark Nifty scaled further for the second consecutive day and closed at two-week high on strong global cues, which reacted to better-than-expected US home sales data. The indices closed above key levels - the Nifty stayed above 5100 level and Sensex held 17000 mark.
Short covering too helped the markets to stay on higher side. Today too short positions had been building up since morning and Nifty June futures traded at around 25 points discount. In the last one hour of trade, some of those shorts got covered and discount trimmed to 13 points, as per provisional data.
US pending home sales for the month of April 2010 went up 6% as against expected increase of 5%. The US markets rallied post this news and ended 2.2-2.7% higher on Wednesday. This news pushed other markets too higher. European markets were trading 1.7-2% higher and US index futures were up 0.2-0.5%, at the time of closing of Indian equities.
In Asian markets, Nikkei surged 3.24%. Straits Times, Kospi, Jakarta and Taiwan Weighted gained 2-2.8%. Hang Seng was up 1.6% while only Shanghai declined 0.73%.
The 30-share BSE Sensex closed at 17,022.33, up 280.49 points or 1.68% and the 50-share NSE Nifty went up 90.65 points or 1.81% to settle at 5,110.50. The broader indices also gained 1.1% each.
Stephen Roach, Chairman (Asia), Morgan Stanley said that that the markets were still flushed with liquidity. The Indian economy and markets are quite safe and not likely to be impacted hard by the crisis. He explained that Indian economy is boosted by the infrastructure sector and the strong Foreign Direct Investment (FDI) policy.
