Nov. 4: Call it the Coal India effect. It was a heady cocktail of the overnight news of the $600 billion stimulus package announced by the US Fed and the listing of the Coal India IPO at a 19 per cent premium to its offer price of ` 245 that saw the Sensex at the highest ever closing of 20,893.57. The last highest closing was 20,873 on January 8, 2008.
The mood was infectious on the exchanges with the oil and gas index being the biggest gainer and stocks like Dr Reddy’s, Hindalco, ICICI Bank, L&T, M&M, PNB, State Bank of India and Tata Motors hitting their 52-week highs.
“The small and mid-cap stocks did not join the party said Pradip Hotchandani of Anagram Securities, pointing out to the lackluster ad-vance decline ratio. There were 738 stocks advancing and 556 closing in the red.
The Sensex was up 427.83 points whilst the Nifty closed at 6281.80 up 121.30 points. CIL closed at 342.55. “There will be a high-powered race to the top during the muhurut trading on Friday evening,” said market strategist, Mr Rajesh Jain.
The positive vibes by the CIL listing will give a fillip to the high powered move. Also Thursday’s splendid rally could be partly due to short covering with the bears once again running for short cover.
Mr Avinash Gupta of Bonanza Portfolio said the rally was led by the FIIs who go for the large cap stocks. There was some genuine buying as those who were sitting on the fence are returning to the market. There is also the CIL refunds coming back.
FIIs are said to have bought shares worth `5,475 crore (provisional figures) and the domestic institutions `874.35 crore.