Sensex hits a 22-month high

Sensex hits a 22 month high
The Sensex traded in a narrow range of 320 points in this week and touched 22 month high at 17790 from a low of this week of 17338 before closing up 75 points or 0.43% at 17540 and the Nifty ended up 0.84% at 5245, led by strength in the metals, consumer durables and energy stocks pack.

KGN Industries, Aban Offshore, Sobha Developers and Tata Tea were the prominent gainers in the the mid-cap space, while Bombay Burmah and Uttam Gulva were gainers in the small-cap space.

Meanwhile, food inflation slipped by 1.61 percentage points to 18.22 during the week ended December 26 from 19.83 per cent in the previous week as vegetable prices fell marginally on weekly basis. But the prices of pulses, potatoes and cereals were still ruling high.

The RBI is scheduled to review its monetary policy stance later this month and has hinted at tightening the money supply.

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And the Q3 results season starts from next week, with the IT major Infosys technologies declaring its results on January 12.

The leading gainers on the Sensex were Grasim (strengthened by 8.2% at Rs 2754), DLF (hardened by 7% at Rs 390) and Hindalco (firmed up by Rs 6.1% at Rs 173). Tata Power, Jaiprakash Associates and Sun Pharma gained between 4% and 6% each.

Index heavyweight, Reliance added 2.4% at Rs 1101.

On the other side the IT sector faced some pressure on higher levels during the week ahead of the results season and also as the rupee touching a 15-week high against the US dollar, the information technology service providers are expected to see flat to negative revenue figures in rupee terms for the quarter ended December 2009.

TCS weakened by 6.8% to Rs 700, Infosys shed 5.7% to Rs 2464 and Wipro shed 3.5% to Rs 669. Mid-cap IT stocks, however, bucked the trend, with Financial Technologies, Aptech and Moser Baer gaining between 4-11%.

The auto sector retraced after touching 52-week highs in the previous week, with Maruti Suzuki, Tata Motors and Bajaj Auto correcting 7.6%, 4.6% and 4.4% respectively.