Oil fires rally in market, bank & auto stocks recover

• Fall in crude prices and short covering resulted in a sharp recovery in the market. Crude oil extended its overnight loss of 8% by falling a further 5% resulting in a sharp rally in the Indian oil producing and manufacturing space.

[caption id=“attachment_4870” align=“alignleft” width=“380” caption=“Markets surge on slump in oil prices. Spencer Platt/Getty Images”]  [/caption]

• The BSE Sensex jumped by 308 points up 1.69% to close the day at 18,518.81, NSE Nifty closed at 5551.45 a rise of 91.65 points.

• Banks and auto companies, which had taken the brunt of the fall over the past nine days, saw some sharp recoveries as traders booked profit on their short position. Banking Index was the top performing sector with a jump of 3.73%, followed by auto that moved up by 3.07%.

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• The market breadth turned positive with 1637 advances, 1147 declines and 116 stocks remaining unchanged.

• The biggest gainer in the Sensex pack was Tata Motors, up 5.49%, followed by ICICI Bank ,up 5.23%. There were only five stocks among the Sensex pack which were in the red during the day. The stocks that fell were Bharti Airtel (down 2.10%), Reliance Infra (down 1.64%), Sterlite (down 1.47%), ONGC (down 1.34%) and Hindalco (down 0.10%).

• Two pharma companies, Glaxo and Cadila announced their results. Glaxo, but for an exceptional item, posted moderate sales and profit growth. Cadila, on the other hand, outperformed analyst expectation by posting an over 50% growth in profit. Glaxo closed the day at Rs 2,305 higher by 2.10%, while Cadila closed the day at Rs 880, higher by 3.65%.

• Among the other results was Tata Sponge, which posted a profit growth of 28.43% to close the day at Rs 356, higher by 6.5%. Rolta too posted a strong 25.25% bottomline growth closing the day at Rs 137 up by 3.66%. NIIT Technologies posted a profit jump of 21% to Rs 192.50.

• SKS Microfinance fell 20% after JP Morgan slashed its target from Rs 550 to Rs 200. Cairn India, whose open offer was closed by Sesa Goa, fell by 2.47% to Rs 338.45. The acquiring company Sesa Goa too fell by 2.66% to Rs 290.70. Bharti Airtel, which posted below par numbers, continued its fall by losing 2.28% to Rs 349.75. Shriram Transport Finance company, which lost nearly 25% of its value in five days, recovered by 7.48% to close the day at Rs 654.10. The company was affected by RBI’s ruling that NBFC’s will no longer be considered as priority sector.

• Reliance Industries, the index heavy weight did not participate in the rally, the stock was up by only 0.66%.