Sensex up 92 pc from 2009 lows

Despite doubts about the continuity of the rally, bulls stepped up purchases as firm global markets and higher US index futures boosted the sentiment for the second straight day. The BSE Sensex rose 339.81 points, or 2.25 per cent, to 15,466.81 its highest closing since August 11, 2008. The S&P CNX Nifty was up 104.95 points, or 2.31per cent, to 4,655.90 its highest closing since June 5, 2008.

The BSE index has surged more than 60 per cent this year, after slumping by 52 per cent in 2008 when foreign funds pulled out about $13 billion. It has soared 92 per cent from 2009 lows in early March, mainly driven by foreign fund inflows of almost $7 billion. Comments by Petroleum Secretary R S Pandey that the government is committed to reforms in fuel pricing also boosted the sentiment. Realty stocks fell even as capital goods stocks rose. Banking stocks pared intra-day gains. “Stocks extended their recent strong gains on a view that ample global liquidity and a return of risk appetite will help India Inc help raise funds for expansion which in turn will boost corporate profits,” said an analyst. India Inc has already raised Rs 5,000 crore from qualified institutional placements (QIPs) so far in 2009 and announced plans to raise another Rs 24,000 crore.

Foreign funds are aggressively buying Indian stocks. FII invested another Rs 738 crore on Wednesday, taking the total investment in June to Rs 3,055 crore.

However, a section of dealers are skeptical about the rally. “I am not comfortable with this rally. The index is being led up by big stocks like Reliance and L&T, but even they can experience profit-booking. We will see a big correction soon,” D D Sharma, vice president at Anand Rathi Securities, said.Starved off gains last year, investors were buying whatever came their way after a stable government came to power last month in India, Bank of America Merrill Lynch equity strategist Vijay Gaba said. “In the melee, valuation is probably the last thing in the minds of the insatiated investors at this point in time,” Gaba wrote in a note titled ‘Hunger Knows No Taste’.

Still, there are concerns pricey shares and a raft of potential equity offering could threaten the stock surge. Net inflows into domestic equity mutual funds rose to Rs 1,930 crore in May 2009, the highest in 14 months, and more than twice the amount in the first four months of 2009, according to data from the Association of Mutual Funds in India.

Finance minister Pranab Mukherjee’s meeting with bank chiefs was also a positive development for the market.

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Stocks seen up; 14th weekly gain on track

Equities are set to open higher on Friday, putting them on course for a 14th straight weekly gain for the first time in four years, as solid US economic data rekindled hopes the world economy was healing.

India's industrial output is likely to have shrunk marginally in April from a year earlier, its fourth fall in five months, but analysts think the worst has passed and output will start picking up. The data is expected around noon.

Fraud-hit outsourcer Satyam Computer, which has jumped 10 per cent on each of the past three sessions after releasing figures that showed it was profitable, will be watched after its chairman said the company was under great stress and its revenue outlook was not great in the near future.

Oil and Natural Gas Corp will be in focus after its chairman said on Thursday the state-run explorer may have suffered a 30 billion rupee ($632 million) loss of revenue for selling gas at government-fixed prices in 2008/09.

Most Asian markets were higher on Friday, with Japan's Nikkei up 0.9 per cent by 0351 GMT, while MSCI's measure of other Asian markets was flat.

US retail sales rose in May for the first time in three months and the number of workers filing new claims for jobless benefits last week hit a January low, fostering hope the recession was abating.

Nifty futures traded in Singapore were up 0.4 per cent, pointing to a higher opening in India.

On Thursday, the 30-share BSE index ended down 0.36 per cent, or 55.34 points, at 15,411.47, as investors pocketed a portion of profits from a three-month rally that had boosted the benchmark more than 90 per cent.

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Buckle up, Indians and Chinese are coming: Obama to Americans

WASHINGTON: US President Barack Obama has exhorted his countrymen to buckle up as the Indians and Chinese are catching them fast, as Americans have now settled into mediocrity. 

"Our kids are falling behind when it comes to science. We have kind of settled into mediocrity when we compare ourselves to other advanced countries and wealthy countries," Obama said in a town hall speech on health care in Green Bay, Wisconsin. 

"That's a problem because the reason that America over the last hundred years has consistently been the wealthiest nation is because we've also been the most educated nation," he said. 

"It used to be by a pretty sizable factor we had the highest high school graduation rates, we had the highest college graduation rates, we had the highest number of PhDs, the highest number of engineers and scientists," Obama said. 

The President said though the Americans used to be "head and shoulders above" the people of other countries, especially in the field of education, they were fast loosing that position.