The Indian market may extend its previous session's rally on Thursday, with positive sentiment across global markets and data showing continued buying by foreign funds, underpinning sentiment.
Asian stocks are seeing broad-based gains this morning, lifting the MSCI Asia-Pacific Index to a two-week high, after U.S. manufacturing grew faster than estimated and the International Monetary Fund raised its 2010 growth outlook for South Korea, easing worries about the global economy.
Foreign institutional investors (FIIs) bought shares worth Rs 359.81 crore on a net basis Wednesday, provisional data shows. Net buying by FIIs totaled Rs. 538.40 crore on Tuesday, according to data released by market regulator SEBI.
Meanwhile, the government admitted that there were mistakes in the first-quarter economic growth rate number released on Tuesday and issued a correction to the demand-side numbers. However, overall GDP growth for the June quarter has been retained at 8.8 percent.
"Inadvertently, there have been use of inappropriate deflators in converting 'Quarterly estimates of expenditures of GDP at market prices in Q1 (April-June) of 2010-11 (at current prices)' to 'Quarterly estimates of expenditures of GDP at market prices in Q1 (April-June) of 2010-11 (at 2004-05 prices)," the ministry of statistics and programme implementation said in a statement.
On Wall Street, stocks saw substantial gains on Wednesday, as data showing a pickup in manufacturing activity in both the U.S. and China recharged hopes of a continued economic recovery. The rally was further fueled by a better than expected reading on resource-linked Australian GDP. The major averages ended near their best levels of the day. The Dow rallied 2.5%, while the Nasdaq and the S&P 500 climbed about 3% each.
The Indian ADRs also closed sharply higher across the board. Among the top gainers, MTNL and Sterlite climbed about 7% each, Infosys, ICICI Bank and HDFC Bank rallied around 4% each, and Wipro and Mahindra Satyam ended up about 2% each.
Crude oil prices sailed higher on Wednesday as improvement in the U.S. manufacturing industry eased some fears about the strength of the global recovery. Light, sweet crude for October delivery rose $1.99 or 2.8% to close at $73.91 a barrel on the New York Mercantile Exchange.
The Indian market rallied on Wednesday, joining its peers in Asia and Europe, after a slew of economic data eased worries about softening global growth. The benchmark 30-share Sensex ended up 235 points or 1.31% at 18,206, with 27 of its components closing firm, while the 50-share Nifty rose by 69 points or 1.29% to 5,472.
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