Short-covering does the trick

STOCK REPORT

Key indices ended over 1 per cent up on Thursday on buying by foreign funds after the US Federal Reserve kept interest rates unchanged Wednesday, dealers said.

Short covering ahead of September derivatives expiry next week also added to the rise, they said.

Nifty September futures contract ended at 5-point premium to the spot index, and open interest rose 1 per cent.

Sentiment was also up as advance tax collections detailed Wednesday indicated another robust earnings quarter.

Government collected Rs 216 billion between September 1-16 as second instalment of advance tax, up 33 per cent on year.

Bombay Stock Exchange's 30-share Sensex ended at 12274.27, up 165.13 points or 1.4 per cent from Wednesday, after moving between 12167.91 and 12285.90 intra-day.

National Stock Exchange's 50-share Nifty ended at 3553.05, up 50.25 points or 1.4 per cent, after moving between 3506.70 and 3556.35 intra-day.

Combined turnover on the exchanges was roughly Rs 105 billion compared with Rs 99 billion on Wednesday.

CNX Midcap and S&P CNX 500 were up 1 per cent each.

On BSE, advances led declines marginally, 1.2:1.

Bank shares were the top gainers, after the Fed decided Wednesday to keep interest rates unchanged at 5.25%, expecting similar decision by Reserve Bank of India at its next quarterly monetary policy review in October. BSE Bank Index ended up 2 per cent.

Oriental Bank of Commerce, up 7 per cent at Rs 247, was the top Nifty gainer.

Hindustan Lever, up 4 per cent at Rs 259, and Bajaj Auto, up 3 per cent at Rs 2,895, were other major Nifty gainers.

Jet Airways, down 2 per cent at Rs 642, was the worst hit on Nifty after the company Wednesday said it had postponed plans to raise capital from overseas.

Hero Honda Motors, down 1 per cent at Rs 768 was the other major laggard.