Equity benchmarks rallied Wednesday after the Economic Survey said that the current economic downturn may have run its course, and things were looking up. Midcap shares continued to be under pressure as cash-strapped traders unwound their positions, unable to pay the margins required to hold them.
Brokers say stocks would have also got a leg up due to short covering of positions after Tuesday’s crash when the Sensex shed over 300 points.
But they said today’s rise notwithstanding, near term outlook on the market had soured, unless the Finance Minister had some solid positive surprises in the Budget. The Economic Survey too raised plenty of red flags even as it provided a glimmer of hope.
Jet Airways led gainers in the Sensex, climbing as much as 20 percent intra-day after Etihad Airways said it had paid USD 70 million for three slots of Jet at London’s Heathrow airport. The stock closed at Rs 534.85, up 19.3 percent over its previous close. The latest development raised hope among investors that Etihad is on track to buy a stake in Jet. The stock had fallen sharply on Tuesday on concerns that the deal may not materialize.
Larsen & Toubro, ONGC, Bajaj Auto, Mahindra & Mahindra and BHEL were the other key gainers, rising between 2-3 percent.
Core Education was the biggest loser among midcaps, falling 46 percent to close at Rs 60, even as the management maintained that the company was doing fine operationally.
In the last three sessions, the stock has fallen nearly 80 percent.
Shares of Educomp Solutions, Opto Circuits, Pipavav Defence, Welspun Corp and Delta Corp were down between 4-8 percent.
At 14.39 PM, the 30-share BSE Sensex touched high point of the day rising 194.56 points or 1.02% at 19209.70, and the Nifty climbing 54.35 points or 0.94% at 5815.70.
The 50-share NSE Nifty extended gains in afternoon trade, rising above 5800 level especially after announcement of Economic Survey for fiscal 2013-14. The index moved up 41.70 points to 5,803.05, helped by ICICI Bank, Reliance Industries and L&T.
At 12.55 PM, the Sensex was up 132.97 points or 0.70% at 19148.11, and the Nifty was up 34.80 points or 0.60% at 5796.15.
At 12.14 PM, the Sensex was up 88.28 points or 0.46% at 19103.42, and the Nifty moved up 19.50 points or 0.34% at 5780.85.
The sell-off in midcap shares intensified on Wednesday, with rumours swirling that the promoters of some of these companies could be teetering on the edge of bankruptcy.
Serious damages have begun to unfold in the broader markets, serving as a grim reminder to bloody Tuesday and threatening to spill over to largecaps. At 10.36 AM, the Sensex was down 2.61 points at 19012.53, and the Nifty fell 6.30 points to 5755.05.
At 09.17 AM, the Sensex was up 89.13 points at 19104.27, and the Nifty gained up 32.65 points at 5794.00. Top largecap gainers on the indices were Bhart, Sterlite, BHEL, Jindal Steel, HDFC, DLF, JP Associates and Sesa Goa.
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Economy turning for sure but cant say for mkts: DSP