Markets end higher led by banks, oil stks; Nifty above 4000

18 September 2008

Positive statement from Finance Minister has helped markets a lot to witness sharp recovery in last one hour of trade. Our markets have also taken a cue from Asian and European markets, which recovered from days low after global banks taken measures to improve liquidity in markets. Benchmark indices closed with marginal gains, supported by banking, oil, capital goods, power and few auto stocks. However, realty, technology, telecom, pharma and few metal stocks remained under pressure followed by midcap and small cap stocks.

The Sensex gained 52.70 points or 0.4%, to close at 13,315.60 and the Nifty ended with a gain of 29.9 points or 0.75% at 4038.15. The Sensex recovered 757.46 points and the Nifty 238.6 points from days low of 12,558.14 and 3799.55, respectively. The Nifty has struggled a lot to stay above 4000 mark.

Finance Minister P Chidambaram assured that PSU banks have virtually no exposure to Lehman. According to him, credit crunch globally will impact credit availability in the Indian market. He said that there is no cause for any alarm that any Indian bank is vulnerable.

FM still maintains FY09 economic growth close to 8%. He said that the government will take steps to provide liquidity.

FM said that a lot of people are making case to ease ECB norms. Government has received full report from Tata AIG management and the solvency margins are adequate, he added. Tata AIG has also assured that all commitments will be met.

In order to improve liquidity in global markets, global banks took measures, which has helped Asian and European markets to recover from days low. US Federal Reserve authorised USD 180 bllion expansion of temporary FX swap lines. The Dow Jones Futures was up 75 points and Nasdaq Futures rose 20 points.