Benchmarks flat, broader markets gain amid mega announcements

Monday, June 28, 2010
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Mumbai: Benchmark indices for Indian equities ended flat for the week amid announcements from both Ambani brothers' firms that they had signed a new gas supply agreement and the government freeing auto fuel prices. The 30-share sensitive index (Sensex) of the Bombay Stock Exchange (BSE) ended almost unchanged from its previous weekly close. It closed Friday at 17,574.53 points after rising a meagre 3.71 points. The Sensex the week before had closed at 17,570.82 points. The broader S&P CNX Nifty of the National Stock Exchange (NSE) too ended the week flat at 5,269.05 points, up 6.45 points, from its previous weekly close at 5,262.6 points. Anil Ambani-promoted Reliance Natural Resources (RNRL) Friday signed a revised gas supply agreement with Reliance Industries (RIL), controlled by Mukesh Ambani, which sent stocks of both the groups soaring. "The said gas supply master agreement is compliant with the gas utilisation policy and eGOM (empowered Group of Ministers) decisions," said a Reliance Industries statement. The government approved rate is $4.2 per million metric British thermal units (mmBtu), but both companies refrained from mentioning the price, tenure of supply and the quantity of gas agreed upon. In other major news, the government Friday freed the price of auto fuels, petrol and diesel, allowing oil marketing companies to price the fuels depending on the international prices of crude oil. State-run oil firm stocks shot up as a result with many gaining over 10 percentage points in a single day. Broader indices reflected gains in oil stocks, consumer durables, healthcare, realty and FMCG scrips. The midcap index ended Friday gaining 1.53 percent and the BSE smallcap index went up 1.62 percent. According to data with the Securities and Exchange Board of India (SEBI), foreign institutional investors bought scrips worth over $1.1 billion during the week. Among other Asian markets, investor sentiments remained jittery after a mediocre economic outlook painted by the US Federal Reserve and financial crisis in Europe. The Japanese Nikkei lost about 2.58 percent to end the week at 9,737.48 points, while the Hang Seng of the Hong Kong Stock Exchange closed at 20,690.79 points, 1.99 percent higher. The Chinese Shanghai composite index too ended among gains at 2,552.82 points, up 1.58 percent from its previous weekly close. Key European indices ended in the red over the gloomy US economic data, while BP's losses to clean the Gulf of Mexico oil spill sent the stock tumbling pulling down investor sentiments. London's FTSE shut shop 3.89 percent down to close the week at 5,046.47 points. Its French peer CAC lost a whopping 4.54 percent at 3,519.73 points, while the German DAX closed 2.35 percent down at 6,070.60 points. It was a weak week at Wall Street as well. The benchmark indices such as the Nasdaq shed 3.74 percent to close the week at 2,223.48 points, and the S&P 500 lost 3.65 percent at 1,076.76 points. The Dow Jones industrial average also closed 2.94 percent up at 10,143.81 points.
Source: IANS
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