Strong rumours of an impending settlement between the Ambani brothers and Infosys’ better-than-estimated earnings helped the Bombay Stock Exchange end a five-day losing streak.
The Bombay Stock Exchange’s Sensitive Index, or Sensex, added 299.13, or 3.3 percent, to end at 9,370.49. The S&P CNX Nifty Index on the National Stock Exchange gained 3.3 percent to 2,835.30, its largest gain since December 18.
Reliance rallied 9.5 per cent, rebounding from a four-day, 21 per cent retreat, as the market was abuzz with speculation that Mukesh and Anil Ambani may head for an out-of- court settlement in the two-year old Krishna-Godavari basin gas dispute.
Apart from Reliance Industries, the stocks of three Anil Ambani-led companies -- Reliance Natural Resources (RNRL), Reliance Communications and Reliance Infrastructure surged 12.6 per cent, 10.4 per cent and 9.7 per cent, respectively.
However, a Reliance Industries spokesman termed baseless reports of an out of court settlement or negoatiation between the two parties of any nature. “We categorically all such rumours,” he said.
The Ambani brothers have been fighting it out in the Bombay High Court for the past two years over the gas supply from KG basin. According to a Gas Sale Master Agreement between RIL and RNRL, RNRL is entitled to be supplied 28 million cubic meters of gas per day from the KG basin at a price of $2.34 per million British thermal unit (mBtu) for a period of 17 years.
RIL has refused to supply gas at that price for that period and at that price.
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Meanwhile, Infosys rose 6.1 per cent, extending yesterday’s gains. Tata Consultancy Services felt the rub-off effect, jumping 2.5 per cent before the release of its results tomorrow.
At least three brokerages have raised their ratings on Indian stocks in the past two weeks, advising investors to buy as valuations fall. HSBC Holdings last week raised India’s rating to “overweight” from “neutral,” joining Macquarie Group and JPMorgan Chase & Co in upgrading the market.
The market breadth was fairly positive: Out 2,489 stocks traded,1,402 advanced and 982 declined.
Rajesh Jain, chief executive officer in Pranav Securities, said that the market was oversold because of the Satyam scam and therefore there was a technical reason for a bounce-back.
Sudip Bandhopadyay, chief executive officer of Reliance Money, said positive news led to On Wednesday rally and the markets could see sector-specific rallies in future as well.
| GAINERS GALLERY | ||
| Jan 14, 09 | % Chg* | |
| RNRL | 54.25 | 12.67 |
| R Comm | 185.40 | 10.36 |
| Reliance Infra | 522.35 | 9.70 |
| Reliance Ind | 1,178.15 | 9.00 |
| Other top Sensex gainers | ||
| Infosys Techn | 1304.85 | 6.07 |
| Mah & Mah | 319.95 | 5.39 |
| Tata Steel | 213.45 | 5.23 |
| Jaiprakash Asso | 70.35 | 5.08 |
| Hindalco | 50.60 | 4.12 |
| * Over previous close | ||
| Top 5 BSE sectoral gainers | ||
| Jan 14, ‘09 | % Chg* | |
| Oil & Gas | 5,809.81 | 5.85 |
| IT | 2,255.42 | 5.02 |
| Realty | 1,853.49 | 4.38 |
| Metal | 5,057.89 | 4.18 |
| Power | 1,746.74 | 2.97 |
The oil & gas index went up by 5.85 per cent, IT by 5.02 per cent and Tech Index by 4.57 per cent.
The US markets closed flat with Dow Jones down marginally by 0.3 per cent,S & P 500 and Nasdaq Composite were marginally up by 0.18 per cent and 0.5 per cent, respectively.
Asian markets were also flat with Nikkei 225 and Hang Seng marginally up by 0.29 per cent and 0.27 per cent, respectively. Kospi up by 1.28 per cent.