Volatile Sensex recovers 500 pts intra-day on PSU stake sale

Fri, Nov 6 05:38 AM

Led by bruised telecom stocks, Dalal Street climbed nearly 1 per cent on Thursday as bargain hunters stepped in toward the close of day's trade after the market fell more than 2 per cent. The 30-share BSE Sensex recovered almost 500 points from the intra-day low and closed up 151.77 points at 16,063.90 following the government's announcement about stake sale plans in public sector companies. The 50-share NSE index closed 1.2 per cent higher at 4,765.55.

After a weak opening, the sentiment turned bullish within minutes of home minister P Chidambaram announcing the Cabinet decision to divest 10 per cent stake in all listed companies. The government also decided to list all profit-making public sector firms with a positive net worth. The Sensex had plunged to 15,564 points at one stage.

"The markets initially lost its gains made on Wednesday on the back of news that the country's indirect tax revenue fell by 24 per cent. But when reports came out that the Cabinet had decided that there should be at least 10 per cent public holding in all profitable PSUs, the market gained momentum," said an analyst with Geojit BNP Paribas Financial.

The stock market has been volatile in recent sessions, with the benchmark Sensex rising 3.3 per cent on Wednesday after falling 8.4 per cent over six sessions. Bharti Airtel and Reliance Communications rose 4.50 per cent and 5.34 per cent respectively after they had slumped in the past one month.

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