Markets unperturbed by rate hike, Sensex up 60 pts

Mumbai, Apr 20 (PTI) The Bombay Stock Exchange benchmark
Sensex Tuesday snapped the five-day losing streak to close 60
points higher as investors found comfort in a less-than
-expected hike in key policy rates by the RBI.
Markets soared over 159.41 points soon after the Reserve
Bank of India (RBI) announced its policy for 2010-11. The
30-share BSE index, however, pared some of the gains to settle
at 17,460.58 points, a climb of 59.90 points or 0.34 per cent.
The 50-share Nifty index of the National Stock Exchange
gained 0.60 per cent to 5,234.70 points.
Interest rate sensitive sectors -- realty, bankex, auto--
rallied, up 3.08 per cent, 1.53 per cent and 1.19 per cent
respectively. Country's largest lender SBI gained 3.26 per
cent on BSE to emerge as the biggest gainer among Sensex
companies. ICICI Bank gained 1.49 per cent and HDFC Bank was
up 0.33 per cent.
Analysts said investor mood turned bullish as the rate
hike was less than the street expectation, which led to
bankers saying that they will not immediately hike interest
rates.
"Rate sensitive sectors like banking, realty and auto
all gained cheering the positive rate hike by the bank which
will help the fast growing economy to cool-off by sucking some
amount of excess liquidity," Kotak AMC Head–Fixed Income and
Products Lakshmi Iyer said.
Software major TCS's solid Q4 quarter numbers failed to
prop up IT sector stocks as an appreciating rupee against the
dollar raised concerns of revenes from exports being hit.
Infosys Technologies closed down 0.70 per cent, TCS 2.74
per cent and Wipro 1.27 per cent.
The Indian rupee gained by 23 paise to 44.50 against the
American currency on fresh selling of dollars by banks.
Reliance Industries, which carries maximum weight on the
index, moved up 0.81 per cent.
Other major gainers were Maruti (1.63 per cent), Tata
Motors (2.13 per cent), M&M (1.41 per cent) and HUL (1.36 per
cent).
"There are no immediate signs by the financial
institutions to increase their rates, hence these stocks
surged on the market," Iyer added.
The apex bank in its monetary policy for 2010-11 hiked
the repo and the reverse repo--short-tern lending and
borrowing rates--to 5.25 per cent and 3.75 per cent,
respectively, and the CRR, amount banks park with the RBI, to
6 per cent.
Some analysts feel that the rate hike was already
factored in and hence the markets reacted positively to the
news and ended in the positive terrain.
Among scrips that bucked the broader positive trend and
moved down were Hero Honda (2.39 per cent), ONGC (0.12 per
cent), Bharti (0.56 per cent) and Tata Power (0.21 per cent).
Global markets were mixed with the Asian stocks closing
lower while the European markets trading higher. PTI AKH
RDM



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