Sensex, Nifty at new highs

The Indian stock market ended the first week of the new year on a positive note with both key indices "" the Bombay Stock Exchange's Sensex and the National Stock Exchange's Nifty 50 "" scaling new lifetime highs, propelled by heavyweights Oil & Natural Gas Corp and Reliance Industries, on rising crude prices, coupled with the government's announcement to hike retail oil prices by this month-end.

Big buying by domestic institutions and Finance Minister P Chidambaram's plea to bank chiefs to reduce lending rates to maintain economic growth also boosted sentiment, said dealers.

The Sensex was up 341.69 points, or 1.68 per cent, to 20,686.89 while rival National Stock Exchange's S&P CNX Nifty Index gained 95.75 points, or 1.55 per cent to 6,274.30.

The first week of 2008 saw the Sensex and the Nifty rising 2.38 per cent (479.94 points) and 3.20 per cent (194.60 points), respectively.

This is a strong start for the market for this calendar, after its record-breaking 47 per cent gain in 2007.

"Sectors such as domestic consumption, infrastructure and financial services look good. We are bullish on telecom, engineering, capital goods and banking space," said Puneet Nanda, executive vice-president and chief investment officer of ICICI-Prudential Life Insurance.

Domestic institutions have bought a net of over Rs 1,768 crore this week, negating selling pressure from foreign funds, who sold a net of Rs 1,300 crore in the same period. On Friday, the domestic institutions were net buyers for Rs 520 crore. FIIs were net buyers for nominal Rs 16 crore today.

ICICI-Prudential Life, which is the second biggest investor in Indian equity markets among insurance majors (after government-owned Life Insurance Corp), has seen its assets under management growing from Rs 15,800 crore to Rs 28,000 crore since March 31, 2006.

The BSE Oil & Gas Index, which rose 2.31 per cent, was the biggest gainer among sector-specific indices.

Elsewhere, the Japanese markets had its worst new year start, with its Topix index declining by 4.3 per cent.

The Nikkei 225 Stock Average slumped 616.37, or 4 per cent, to 14,691.41 at close in Tokyo, the lowest since July 2006. But, Hong Kong's Hang Seng, China's Shanghai and Korea's Kospi ended higher.