Business | Markets
Indian shares rally to highest close in eight weeks
Indian shares rallied late on Friday to their highest close in almost eight weeks, but trade was choppy after inflation topped 12 per cent for the first time in 13 years and raised more monetary tightening worries.
- Reuters
- Published: 00:01 August 9, 2008
Mumbai: Indian shares rallied late on Friday to their highest close in almost eight weeks, but trade was choppy after inflation topped 12 per cent for the first time in 13 years and raised more monetary tightening worries.
The main index rose 0.3 per cent and notched a fifth weekly gain in a row, registering its best run this year. But traders said the outlook was uncertain and would depend upon global factors such as oil prices, credit crisis fallout and US economic woes.
"Market drew comfort from cooling oil prices and staged an upward move towards close but concerns on inflation still remain," K K Mital, head of portfolio management Services at Globe Capital, said.
The 30-share BSE index rose 0.33 per cent , or 50.57 points, to 15,167.82, with half its components gaining. It firmed 3.5 per cent in the week but is down a quarter in 2008.
The benchmark spent most of the day in negative territory, falling as low as 14,888.12 at one stage after analysts said late on Thursday inflation was yet to peak and the central bank was not done with monetary tightening as the wholesale price index rose 12.01 per cent in the 12 months to July 26.
Boost from oil
Traders said the market got a boost after oil fell below $118 a barrel, easing the threat of further rate hikes immediately. No 2 lender ICICI Bank rose 2.9 per cent to Rs728.90 taking gains in the week to 13.5 per cent .
HDFC Bank climbed 2.1 per cent to Rs1,280.20 and the sector index climbed 1.5 per cent .
Shares in software services companies fell on concerns of weaker outsourcing prospects in the US, their biggest market, after insurer American International Group posted a big loss. Infosys Technologies fell 2.4 per cent to Rs1,679.85 and No 4 Satyam Computer Services dropped 1.8 per cent to Rs409.
Reliance Industries fell 0.9 per cent to Rs2,250.45 after the Economic Times newspaper said a government committee had recommended a windfall tax for private refiners to help pay for oil subsidy.
The paper cited the panel as saying private-sector oil producers such as Reliance will have to part with half their revenue above $75 a barrel to help keep retail price of fuel low.
Oil and Natural Gas Corp rose four per cent to Rs1,064, to its highest close since March 28.
The broader 50-share NSE index rose 0.12 per cent to 4,529.50.
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