Date:04/11/2008 URL: http://www.thehindubusinessline.com/2008/11/04/stories/2008110451991000.htm

Back Nifty stocks stun with 15 to 60% gains in five days

Commodity stocks rule on the list of winners.

Aarati Krishnan

BL Research Bureau Were you intrepid enough to buy stocks when the markets plunged to a panic low last Monday? If you were, you’d already have hefty gains to show for your effort.

Despite the past trading week being curtailed by two holidays, some index heavyweights have notched up gains of anywhere between 15 and 58 per cent since last Monday.

In the Nifty basket, Unitech (up 58 per cent), Tata Communications (48 per cent), Hindalco (46 per cent), Ambuja Cement (43 per cent) have been the top gainers in this period.

Commodity stocks, beaten down to rock-bottom valuations in the recent rout, dominate the gainers list, as hope gained ground that prices for key commodities such as aluminium, steel and oil may have already factored in a worst case scenario for the global economy.

Hindalco, Reliance Industries, Sterlite Inds, and SAIL were among the commodity names that figured on the gainers’ list.

Interest cut

RBI’s successive interest rate cuts also bolstered the case for investing in rate-sensitive sectors — contributing to gains on stocks such as M&M and Tata Motors.

Were the stocks that were most beaten down so far this year also the ones to recover the most? That held true for realty major Unitech (up 58 per cent last week, but still down 90 per cent off its January highs) and ICICI Bank (up 39 per cent this week, but still 65 per cent down this year). But stocks such as Tata Communications, and L&T, which had not done as badly as some of their peers this year, have also managed to post strong gains.

Investment gurus often point out that staying out of the market on its 10 best days can leave a big dent on your long-term returns. Last week’s events certainly seem to prove that point.