Indian markets rally for the fifth straight week

Mumbai -  Indian equities markets rallied for the fifth consecutive week with investors buoyed by the hope that the economy could shrug off the sluggishness of the past few months that would result in increased inflow of overseas funds.

The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) ended the week at 17,604.96 points, up 2.15 percent or 370.98 points from its previous week's close at 17,233.98 points.

The 50-scrip S&P CNX Nifty of the National Stock Exchange also gained 2.32 percent or 121.15 points during the week to close Friday at 5,325.85 points.

Since the beginning of the year, Indian markets have been riding a firm bull rally. The Sensex has shot up 13.91 percent or 2,150.04 points till Feb 3. The Nifty too has shot up 15.17 percent or 701.55 points in little over a month.

Foreign fund flows have also led to a strong recovery in the value of rupee, helping alleviate worries of investors. The Indian rupee closed Friday at a 3 month high at 48.68 against a US dollar.

Strong overseas inflow have of course played a big role in the current rally. Since the beginning of the year, foreign institutional investors have pumped in over $2 billion.

Also helping is a clear indication from the Reserve Bank of India (RBI) that it would from now on focus on supporting growth. The RBI had in January cut the cash reserve ratio (CRR), the amount against deposits which commercial banks have to keep as liquid assets such as cash, by 50 basis points to 5.5 percent from 6 percent.

During the week under review, the biggest gainer on the Sensex was Bharti Airtel, whose scrip rallied handsomely after the Supreme Court cancelled 122 telecom licences tainted by the 2G scandal.

The Airtel scrip closed the week with a 7.8 percent gain at Rs.388.60.

Other gainers on the benchmark included: Hindalco, up 6.7 percent at Rs.152.65; TCS, up 6.2 percent at Rs.1,168.15; Tata Motors, up 6 percent at Rs.247.95 and Reliance Industries, up 5.2 percent at Rs.837.75.

Major losers on the 30-scrip index were: BHEL, down 7.1 percent at Rs.263.80; Coal India, down 5.6 percent at Rs.326.20 and ITC, down 2.6 percent at Rs.200.55.