By IANS,
Mumbai : Despite opening weak Tuesday on profit booking, Indian equities markets surged late afternoon and finished in the green after Finance Minister P. Chidambaram announced that state-owned banks had agreed to cut lending rates.
The 30-share benchmark sensitive index (Sensex) of the Bombay Stock Exchange (BSE) closed at 10,631.12, up 293.44 points or 2.84 percent from its previous close Monday at 10,337.68 points.
With investors resorting to booking profit on gains made during the previous two successive trading sessions, the Sensex opened some 30 points down and soon dipped to hit an intra-day low of 10,116.22 points.
But it began to surge mid-afternoon after the finance minister’s announcement that banks would cut lending rates following his meeting with the chiefs of state-owned banks.
The broader-based 50 share S&P CNX Nifty of the National Stock Exchange (NSE) also opened weak but then recovered to close at 3142.10 points, up 98.25 points or 3.23 percent from its previous close Monday at 3043.85 points.
The BSE midcap index closed at 3,446.22 points, up 90.68 points or 2.70 percent from its previous close Monday at 3,355.54 points.
The BSE smallcap index finished at 4,035.11 points, up 108.01 points or 2.75 percent from its previous close at 3,927.10 points.
As many as 11 of the 13 sectoral indices finished with gains and only telecommunications, media and technology and information technology indices showed losses.
Realty, bank, power and public sector unit stocks were the major gainers.
DLF Ltd finished as the top gainer with a 14.66 percent rise followed by Ranbaxy Laboratories, up 9.88 percent, Jaiprakash Associates, up 9.82 percent and Tata Power, up 8.32 percent.
Satyam Computers shed 7.41 percent to lead the losers, followed by Tata Consultancy Services, down 7.38 percent, Wipro Ltd down 4.80 percent and Infosys Technologies losing 3.32 percent.
As many as 1,809 stocks or 68.14 percent advanced, 777 stocks or 29.27 percent declined and 69 stocks or 2.6 percent remained unchanged.
Besides the finance minister’s announcement that state-owned banks had agreed to cut lending rates, other good news included the fall in the London Interbank Offered Rate (Libor), the rate that banks charge each other to make overnight loans to 0.39 percent Monday, from 0.41 percent Friday – the lowest level since 1997 when the British Bankers’ Association began tracking the rate.
Other Asian markets were also in the green with Nikkei, the key index of the Tokyo Stock Exchange, again regaining 9,000 levels to end with a gain of 6.27 percent.
The Hang Seng, key index of the Hong Kong Stock Exchange also finished with a gain of 0.28 percent.
Analysts said that while there were still no signs of any strong bullish trend, markets should continue to recover from the lows it had hit recently.