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Robust economic growth data boosts Indian stock market
Thursday, 01 April 2004, 20:30 IST
MUMBAI: Enthused by robust economic growth data for the quarter ended December 2003, India's benchmark share market index staged smart rally Wednesday even as sell-off in tech stocks continued on unabated rise in the rupee.
Dealers said that the stock market opened for the day little changed after closing with moderate loss in the previous session. The market index slipped into the negative zone in the early trade following profit taking on tech counters.
The stock market, however, managed to shrug off the bearish pressure as surged higher as soon as the news of sharply higher economic growth in the October-December quarter reached the trading ring.
The stock market barometer 30-share Bombay Stock Exchange sensitive index or Sensex closed at 5,590.60, representing a gain of 70.16 points or 1.27 percent over its previous session's close.
"The market mood was mainly boosted by the impressive economic growth figures," said a broker with the Bombay Stock Exchange.
"Although most of the fund investors have already factored in the possibility of India registering a blistering economic growth in the current fiscal year, the quarterly figures comes as a temporary boost," the broker added.
"While the overall market mood is likely to remain firm in the coming few sessions on the strong quarterly economic performance, the sustained rise in the value of the rupee will continue to act as spoilsport."
Powered by sharply higher farm output, the Indian economy grew by a dazzling 10.4 percent in the quarter ended December, outstripping China's growth rate and making it one of the most dynamic economies globally.
The announcement is sure to give ammunition to the country's ruling coalition, which is hard-selling its economic achievements in the run-up to the general election next month.
China's economy rose 9.1 percent in 2003, according to official figures. The Chinese government has officially targeted a much lower growth rate for 2004 of around seven percent
According to the government's Central Statistical Organisation (CSO), the gross domestic product (GDP) showed a 10.4 percent growth in the October-December quarter of the current fiscal year that ended Wednesday.
The GDP had expanded by just two percent in the October-December quarter of fiscal 2002-03, according to CSO.
The sharply higher growth in the quarter ended December 31, 2003, over the same period in fiscal 2002-03, was on account of improved agricultural and manufacturing production.
Meanwhile, the rupee also rose to its highest in more than four years, gaining 0.9 percent to 43.65 per dollar on the economic growth news.
In the old economy sector, Tata Motors, a leading passenger cars and commercial vehicles maker, rose 3.5 percent to 
485.70 on hopes that a sharply higher economic growth would boost the company's sales.
Other automobile stocks such as Bajaj Auto gained 3.1 percent to touch 574.35 and Hero Honda Motors ended 2.5 percent higher at 490.45 on fresh institutional buying interest.
Other major gainers in the sector included Grasim Industries, Larsen and Toubro, Gujarat Ambuja Cements, Associated Cement Companies, Hindustan Lever, State Bank of India, Reliance Industries, and Ranbaxy Laboratories.
In the technology sector, Hyderabad-based Satyam Computer declined 2.6 percent to 293.50 on fears that the unabated rise in the value of the rupee against the dollar would dent the earnings of export-oriented IT industry.
Infosys Technologies, India's largest listed software exporter, ended nearly two percent lower at 4,938.15 and software major Wipro closed with a loss of 1.3 percent at 1,359.35.
Source: IANS
485.70 on hopes that a sharply higher economic growth would boost the company's sales.
Other automobile stocks such as Bajaj Auto gained 3.1 percent to touch 574.35 and Hero Honda Motors ended 2.5 percent higher at 490.45 on fresh institutional buying interest.
Other major gainers in the sector included Grasim Industries, Larsen and Toubro, Gujarat Ambuja Cements, Associated Cement Companies, Hindustan Lever, State Bank of India, Reliance Industries, and Ranbaxy Laboratories.
In the technology sector, Hyderabad-based Satyam Computer declined 2.6 percent to 293.50 on fears that the unabated rise in the value of the rupee against the dollar would dent the earnings of export-oriented IT industry.
Infosys Technologies, India's largest listed software exporter, ended nearly two percent lower at 4,938.15 and software major Wipro closed with a loss of 1.3 percent at 1,359.35.
Source: IANS