Agencies
New Delhi, Oct 23: Finance minister Palaniappan Chidambaram said on Thursday there was adequate liquidity in the banking system and he has advised banks to lend aggressively.
Chidambaram also asked investors not to sell stocks in panic. The minister's comments came after the main stock index plunged to its lowest since June 2006 amid a gloomy global economic outlook.
Markets recovered after the finance minister’s statement and were also helped by the Sebi directive to FIIs to reverse short positions. A positive opening on the European bourses also aided the positive sentiment. Gains in technology and consumer durables led the upmove.
At 2:20 pm, Bombay Stock Exchange's Sensex was at 10,117.18, still down 0.52 per cent or 52.72 points, recovering from a low of 9,681.28.
National Stock Exchange's Nifty was at 3022.90, down 1.38 per cent or 104.8 points. The index touched a low of 2918.10 and high of 3085.10.
BSE Midcap and Smallcap indices were down 1.79 per cent and 2.19 per cent respectively.
Biggest Sensex gainers were TCS (4.96%), Wipro (4.92%), BHEL (4.7%), Infosys Technologies (2.97%) and HDFC Bank (2.8%).
Tata Motors (-10.76%), Tata Steel (-10.68%), Hindalco Industries (-9.56%), Sterlite Industries (-8.71%) and Ranbaxy Laboratories (-5.69%) were under pressure.
Market breadth on BSE showed 1745 declines against 642 advances.
Earlier, investors capitalised on the sharp fall in indices in opening trade and took positions in stocks available at cheaper levels. This triggered a recovery in benchmarks from day’s lows. Metals and realty continued to extend overnight losses.
Benchmarks opened below psychological levels following sharp declines overnight in US and Asian stocks, which tumbled to 5-year-lows, amid heightened worries over a global recession.
In global markets, US stocks plunged on Wednesday as a raft of disappointing corporate earnings from major US companies fueled pessimism about the global economy despite further thawing in credit markets.
The Dow Jones industrial average sank 514.45 points, or 5.69%, to end at 8,519.21, the Standard & Poor's 500 Index slumped 58.26 points, or 6.10%, to finish at 896.79 and the Nasdaq Composite Index slid 80.93 points, or 4.77%, to close at 1,615.75.
Asian stocks tumbled Thursday, with the Nikkei plunging more than 4%, after another dive on Wall Street. The broader Topix lost 4.83%, Hang Seng lost 4.61% and Straits Times declined 2.93%.
Results announced:
Tata Consultancy Services posted 1.5% rise in net profit at Rs 1,271 crore for the second quarter as against Rs 1,251.60 crore in the corresponding quarter last year. Total income rose to Rs 6,784.45 crore in the second quarter of this fiscal on consolidated basis, nearly 18% up from Rs 5,761.82 crore in the July-September quarter of last year. The company whose 50% revenue comes from the overseas operations said that it suffered a loss of Rs 260 crore in the second quarter due to cross currency hedging. The scrip was down 5.05% on the BSE.
The company expects more financial clients to delay contracts. Some orders that were closed in the three months ended Sep. 30 were contracts that should have been signed in the first quarter, Chief Executive Officer Subramanian Ramadorai said in an interview to a news channel.
Goldman Sachs and Macquarie Securities have cut their share price targets after the company said the rupee's biggest slump in 16 years had caused foreign-exchange losses.
Patni Computer Systems has posted a profit after taxation of Rs 152.95 crore for the quarter ended Sept 30, 2008, grew by 80.09 % gainst Rs 84.93 crore for the quarter ended on Sep 2007. Total income increased 30.18% to Rs 444.94 crore in Jul-Sep quarter of 2008 compared with Rs 341.80 crore in the same quarter of previous year. The company shares were down 4.40 per cent to Rs 151 on BSE.