Sensex recovers 500 points from day’s low

Mumbai: August 09, 2011 – The Indian markets have made a spectacular recovery, with the Sensex gaining nearly 500 points from the day’s low, as investors bought stocks at bargain prices. At 1208 hours, the Sensex was down only 85 points, trading at 16,904 and the Nifty was down 23 points to 5,095.

The Indian markets mirrored Asian stocks that closed off the day’s low. South Korea’s Kospi, once down 8 per cent, closed 3.5 per cent lower while Japan’s Nikkei was down just over 1.5 per cent. The Chinese indices were in the green.

“We are searching and looking for bargains…prices have come down sometimes by 20 per cent, “Mark Mobius of Templeton Asset Management said, adding, “We are very interested in getting something in India and hopefully we can pick up some nice bargains… We want to be more exposed to India… it is just a matter of price.”

The recovery was in contrast to over 500 points plunge that the Sensex witnessed in early trade. The Nifty had slipped below 5,000 for the first time since June, 2010.

Analysts said Indian equities are attractively valued while the government has maintained that the economy is resilient and will bounce back. A fall in crude prices will pull down inflation and force the RBI to hit a pause on successive rate hikes that have affected corporate margins.

Auto and FMCG stocks jumped back into the green and realty stocks also saw buying interest. However, IT stocks continued to remain under pressure and were trading over 2.5 per cent lower.

On the Sensex, 14 of the 30 stocks bounced back into the green led by M&M that reported a 8 per cent jump in net profits on Monday. M&M and Bajaj Auto were trading with over 3 per cent gains. Sterlite, DLF, ITC, SBI and ONGC also saw buying interest.

Among the laggards, TCS remained at the bottom of the Sensex, with a 4 per cent loss. Sun Pharma, Wipro, Tata Motors, Infosys and Tata Steel were trading 2.5-4 per cent lower.

The market breadth had improved substantially and 29 per cent stocks were trading higher on the BSE 500 index.

Suresh Mahadevan of UBS said in the immediate short term high beta markets like India get sold down. “In the immediate short term, the big risk is outflows… Once we get over that, valuations may act as a trigger,” Mr Mahadevan said. The Indian markets received a record $30 billion inflow in FY11. While there might be a lot of pain in the short term, the Indian markets are bound to bounce back in the medium to long term. “The next 2-3 months will be tough for Indian markets but once we get into October things would get better,” Mr Mahadevan said.

The early plunge came on the back of the sixth biggest point decline ever on the Dow Jones Index, which tanked 644.76 points, in its worst drop since December 2008. Worries about the US economic recovery have spooked sentiments. Growth in manufacturing and services has been flat in July and consumer spending has also slowed. The US GDP grew at its slowest since the end of the Great Recession in June 2009. Besides the fears of European debt crisis spreading to bigger countries like Italy and Spain have kept invests on tenterhooks. (ndtv)

Tags: , , , , , , ,
Dr. Raj Baldev, Cosmo Theorist

About Dr. Raj Baldev, Cosmo Theorist

Dr. Raj Baldev, Cosmo Theorist, Ph.D., D. Litt., D Sc. (H.C), Editor-in-Chief of International Reporter, Chairman Media International Ltd., Born on 15 January 1927 in Montgomery, now in Pakistan. Internationally known, man of letters with over dozen of books and thousands of articles to his credit on various subjects including theories on the Creation of the Universe, the Black Holes, Supernovas and other functions of the Universe, Nature and Life , which he described both ways, philosophically and scientifically. He further elaborated how the entire Cosmos were formed. He holds spiritual wisdom of predicting and curing powers of the human problems, so much so, he is popularly known as Destiny Repairer, hence people call him with respect as Swamy Ji. He got the privilege of leading various Parliamentary Delegations abroad on good will missions; he also got the privilege of being invited by differnt Heads of State on state visits. He is the Founder of God Believers (GBA) who place belief in “FAITH”, Universal Modern Religion. FAITH is not a religion but a human service, an encyclopedia of creating healthy balance between Science and God. The main purpose of this mission is to defend the Identity of God from Scientists on one hand and to help fight Global Environmental Abuses, to create awareness of high risks of Excessive Nuclear Stockpiles, global service to the Human Rights and Justice on the other. He is a very simple man, he commands special respect as a holy man with high spiritualism and people address him as His Holiness. He is equally dedicated to the cause of media and journalism where he has been serving the people through his writing for over 50 years; he has also served as Member of Press Council of India. His main aim is to serve the humanity and all kinds of life on the Earth, to serve the elders, women and children, the blind, crippled, lepers and the needy, he is committed to save the Mother Earth from the abuses caused by humans and the nature through the social mission of God Believers (GBA), which also serves the World Peace. In short, he is a global social reformer. Google