Indian shares rally as Bush races ahead in US

Indian shares rally as Bush races ahead in US

By siliconindia staff writer   |   Wednesday, 03 November 2004, 08:00 Hrs
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MUMBAI: India's blue-chip equities, led by technology stocks, staged a sharp rally in intra-day trade Wednesday as reports indicated that US President George W. Bush was set to get a second term in the White House.

Stocks investors see Bush's victory as a positive sign for the Indian stock market and especially for scores of technology companies who handle the back office operations for big US corporations.

The stock market opened for the day with a small positive gap after closing with a gain of nearly one percent in the previous session.

The market index gained as much as one and a half percentage points in the early trade after Bush was projected to be just one electoral vote away from winning a second term in the White House.

At noon, the stock market barometer 30-share Bombay Stock Exchange sensitive index or Sensex was trading at 5,815.79, representing a gain of 61.03 points or 1.06 percent over its previous session's close.

The market shed some its early gains on reports that Democratic presidential candidate John Kerry has refused to concede defeat in the crucial state of Ohio, which carries 20 electoral votes.

Currently, the incumbent Republican president leads Kerry by 51 percent to 49 percent in the popular vote in Ohio.

Earlier, Fox and NBC TV networks projected that Bush had won the key battleground state. The win would make Bush just one electoral vote short of the 270 needed to win the presidency.

"The market mood is clearly upbeat on signs that Bush is going to elected the next president," said Parul Inamdar, an equity market analyst with Prabhudas Lilladher, a leading brokerage firm.

"The rally in the market started due to hectic buying in technology shares and gradually spread to other counters boosting the overall sentiment. The entire environment is looking up," Inamdar told IANS.

"Investors are expanding their portfolios by adding leading tech counters on hopes that outsourcing business would continue unabated with the victory of Bush in the election."

Outsourcing and loss of American jobs have been hot-button issues in the US presidential election held Tuesday. The US is India's prime business destination.

Democratic presidential candidate John Kerry, who had made off-shoring of US jobs overseas a key election campaign topic, had said he wanted to plug loopholes that give American firms incentives to ship jobs out of the country.

India's educational system and training programmes have helped transform the country into a global outsourcing superpower.

The $2.6 billion business process outsourcing (BPO) industry in Asia's fourth largest economy has now become one of the top money-spinning ventures for the country and is set to grow at a dazzling clip in the years ahead.

The US presidential election added to the simmering protests against job losses due to transfer of jobs, with Kerry transforming the shipping of jobs to countries like India and China into a threat to the US economy.

Reflecting the bullish sentiment on the bourses, Infosys Technologies, India's second largest software exporter, was quoting 2.1 percent higher at 1,950 in the intra-day trade.

Bangalore-based Wipro, the third largest software exporter, was up 1.7 percent at 671 while Satyam Computer was quoting at 386.60, representing a gain of 3.5 percent over its previous close.

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