Sensex April surge highest in 12 yrs

Index Jumps 402 Points On Short Covering, Posts 17.5% Monthly Gain

Mumbai: Backed by strong buying in software, banking and oil & gas stocks prompted by short covering on the day of expiration of the April derivatives contracts, the sensex surged 402 points on Wednesday to close at 11,403—its highest close in six months. The day's gains extended sensex's monthly gains to 17.5%, its highest single-month surge in nearly 12 years.
    The day's gains in sensex also reversed its 370-point loss on Tuesday and investors were richer by Rs 90,000 crore with BSE's market capitalisation now at Rs 35.6 lakh crore.
    The 17.5% jump in sensex during April—from its March closing at 9,709 to its Friday closing at 11,403—made India the best performing market in Asia during the month. The gains this month form part of the seven-week rally that has added a little over 42% to the benchmark index.
    However, post these heady one-way gains in such a short duration, brokers and dealers are taking a cautious approach. "There was substantial short covering today. Also there were arbitrage trades between cash and derivatives segments that helped lift the indices. So we are taking a cautious stance for Monday,'' said an institutional dealer with a domestic brokerage. The market is closed on Thursday for Lok Sabha elections, where both the national bourses are based, and on Friday on the occasion of Maharashtra Day.
    Experts also feel that with election results set to be announced in two weeks, there could be increased volatility over the next few weeks and a downside can't be ruled out.
    In Wednesday's market, ICICI Bank topped the sensex gainers with a 8.7% surge to Rs 478. The other top gainers were Jaiprakash Associates, up 6.9% at Rs 139, Sterlite Inds, up 6.8% at Rs 409 and Tata Power, up 6.6% at Rs 494. Among sensex stocks, only one—Grasim—ended lower marginally by 0.5% at Rs 1,778.
    Winners outnumbered laggards with 1,433 advances to 1,025 declines. Wednesday being the expiration day, the combined turnover of the two exchanges was Rs 1 lakh crore, with NSE's derivatives segment contributing Rs 80,000 crore.

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