Sensex closes above 13000 led by bank, tech stocks

01 October 2008

Markets went up and ended higher for the second consecutive day, however volumes were low. Both sessions saw similar kind of pullback rallies on the hopes that US Congress will clear the bailout package. Today's rally was mostly on the back of short covering and lack of selling pressure. Banking and technology stocks were leaders for this session.

The Sensex turned back above 13000 mark and held the same level throughout the day. It closed at 13,055.67, a gain of 195.24 points or 1.52%, after hitting an intraday high of 13,203.86 and low of 12,697.30.

The Nifty had touched 4000 mark during the day, but was unable to hold the same. It was up 29.55 points or 0.75%, to close at 3950.75. It has touched an intraday high of 4000.50 and low of 3861.25.

Laurence Balanco, Asian Technical Research, CLSA, sees major resistance on the Sensex at 15000-15500 and on Nifty at 4500-4600 levels. Balanco said the long-term downtrend is still intact, despite short-term consolidation. The Nifty has a meaningful support at 3000 levels. The Sensex could fall to 8,900 if it were to break below 12,300 levels, he said.

Independent Market Analyst, Dhiraj Agarwal feels there is no upside seen in the market now. He said that the destruction phase is over. However, construction will take some time and in that period there will be trading rallies on oversold stocks that are bought. Therefore he expects the markets to trade in a range for some more months.

After failure of first USD 700 billion bailout plan, US Republican members are forging alternative bailout plan. The proposal will be an alternative to that proposed by US Treasury Secretary Henry Paulson. Experts believe that bailout plan may be passed by end of this week, due to which US markets had bounced back sharply on Tuesday.