The BSE Sensex rose 54.95 points to close at 18774.24, after a 526 points fall in previous session. The NSE Nifty gained 11.75 points to finish at 5667.65. Experts say the recovery could not sustain for long. They expect further fall from current levels due to rupee depreciation.
Equity benchmarks closed rangebound session with marginal gains on Friday, after previous day’s carnage on rupee depreciation. The recovery was not only seen in equity markets, but also in commodities.
The BSE Sensex rose 54.95 points to close at 18774.24, after a 526 points fall in previous session. The NSE Nifty gained 11.75 points to finish at 5667.65.
Meanwhile, the Indian rupee also appreciated by 29 paise to 59.27 per dollar. It had fallen 1.5 percent Thursday to close at record low of 59.57 per dollar after Federal Reserve chairman Ben Bernanke said if the economy continues to improve the asset-purchasing program could start winding down towards the end of 2013 and wrap up in 2014.
Experts say the recovery could not sustain for long. They expect further fall from current levels due to rupee depreciation.
Girish Nadkarni of Avendus Capital says there is distinctly a possibility that the Nifty will fall below the 5600 level.
He sees more selling pressure in banking space, which has a significant weight in the Nifty and the BSE Sensex. "With interest rate yields going up there will be some amount of pressure on banks. In the medium-term you will find credit quality also deteriorating further from now and therefore we could see the equity markets going down," he reasons.
For the week, both equity benchmarks fell more than two percent while CNX Midcap declined 2 percent and Smallcap slipped 1 percent.
Shares of Infosys, Bharti Airtel, Dr Reddys Labs and Maruti Suzuki rallied more than 2 percent.
Oil and Natural Gas Corporation (ONGC) shares rose 2.56 percent, after Deutsche Bank recommended buying the stock with a target price of Rs 395. Finance minister P Chidambaram after the CCEA meeting, said the cabinet would take up gas price issue in CCEA next week.
Jindal Steel & Power (JSPL) shares slumped 8 percent. In the latest on the Coal scam, the Central Bureau of Investigation (CBI) has sent notice to four Jindal group companies, including JSPL, to join the probe, reports CNBC-TV18 quoting sources. JSPL promoters bought 4.5 lakh shares in the company that led support to the stock in late trade; it has fallen nearly 12 percent to touch a 4-year low of Rs 19.
Hindalco Industries dropped 4 percent while banks and FMCG stocks also declined.
Index heavyweight Reliance Industries declined 0.66 percent at close, which was the gainer in afternoon trade.
The Cabinet Committee on Economic Affairs (CCEA) has decided today to allow power companies to pass on the costs of imported coal to customers. Immediately after the news, power stocks gained 1-3 percent, but all could not sustain their gains towards close. Only NTPC stayed on buyers’ radar with 2 percent gain.
The BSE Midcap Index lost 1.3 percent and Smallcap was down 0.36 percent, as declining shares outnumbered advancing ones by 1330 to 979 on the Bombay Stock Exchange.
Foreign institutional investors have net sold Rs 1,768.6 crore worth of equity shares today, but domestic institutional investors have net bought Rs 1,196.65 crore worth of shares, as per provisional data available on the National Stock Exchange.