Sensex scales another peak

Oil refiners led by IOC help the index gain 53.71 points to 16,899.54.

The BSE climbed to its fifth straight record. Indian Oil Corporation led the refiners higher after the government said that it may give oil bonds to help reduce losses at refiners.

"The oil bonds will help curb losses at refiners with crude near record highs,'' said RK Gupta, who manages stocks worth $75 million at Credit Capital Asset Management in New Delhi. The sale prices of fuel are controlled by the government.

State Bank of India and Larsen & Toubro declined after some investors judged recent gains to be excessive.

The Sensex added 53.71, or 0.3 per cent, to 16,899.54. The Nifty gained 6.65, or 0.1 per cent to 4,938.85.

Both the exchanges were shut between 11:25 am and 12:10 pm because of possible disruptions in satellite communication. As a result, the trading was extended until 4:15 pm, 45 minutes after the normal close. The change in trading hours will be in effect until October 9.

Indian Oil, the largest state-run refiner, gained by Rs 31.9, or 7.9 per cent, to Rs 436.2. Hindustan Petroleum, the second-largest state refiner, advanced by Rs 8.75 or 3.4 per cent, to Rs 265.2. Bharat Petroleum, the third-largest refiner, climbed by Rs 23.75, or 7.3 per cent, to Rs 348.5.

India may issue Rs 120 billion ($3 billion) in bonds by October 15 to state-run refiners, according to MS Srinivasan, secretary, oil ministry. The government may give bonds worth Rs 240 billion for the financial year ended March 31, he added.

The bonds are issued to make up for losses incurred by the refiners while selling fuels below the cost price to retail consumers. The government bars refiners from raising retail prices of fuels in line with increases in crude oil costs, to control inflation.

A newspaper report suggesting that Bharat Petroleum discovered gas reserves estimated at 10 trillion cubic feet in partnership with UK's Premier Oil drove the stock up by as much as 21 per cent earlier. Bharat Petroleum later said it has no knowledge of any gas discovery.

State Bank, the nation's largest lender, fell by Rs 29.35, or 1.6 per cent, to Rs 1,803.85 after reporting 13 per cent advances this month.

The stock's relative strength, a moving average based on advances and declines in the previous 14 days, has been above 70 for three days. A reading of 70 indicates a possible fall, according to some analysts

Larsen, the country's largest engineering company, slid by Rs 32.3, or 1.1 per cent, to Rs 2,864.55. Larsen's relative strength has been above 70 since September 20.

"With the stocks at record levels, the investors are taking some money off the table,'' said Gupta.

Overseas investors pumped in Rs 9.24 billion on September 21, according to the latest figures provided by the Securities & Exchange Board of India's website.