The Bulls came back to a battered Dalal Street with vengeance today as concerns about the global credit crisis eased. Joining the global stock rally, the 30-share BSE Sensex rose 928 points (6 per cent) to 16,217.49, its second biggest single-day rally in points as well as percentage terms. The rally was triggered by JP Morgan raising the Bear Stearns acquisition price by 5 times and US economic data that showed US new home sales had risen 3 per cent in February 2008.

ICICI Bank and Infosys Technologies rose more than 9 per cent each, while Reliance Industries added 5.2 per cent. The three stocks account for more than 30 per cent of the Sensex. Tata Motors rose 2.7 per cent to a three-week closing high of Rs 679.95, ahead of an expected deal this week to buy Ford Motor’s premium brands Jaguar and Land Rover.

Investors across the world were heartened by the news that JP Morgan Chase had raised its offer for subprime-hit Bear Stearns five-fold to $10 a share from $ 2 a share. The new offer signals that investors’ losses might not be as sizable as feared. Monday saw strong gains on Wall Street with the Dow Jones closing up 187 points, putting on over 400 points since Thursday. “A re-evaluation of the Bear Stearns deal price by JP Morgan gave investors added belief that the credit crunch was coming to an end,” said a dealer.

Religare Securities Ltd president (equity) Amitabh Chakraborty said, “As expected, the Indian markets rebounded today as we’ve neared the F&O expiry on Thursday. We have seen markets across the globe rebound during the week but markets like India, the Hang Seng and Shanghai have witnessed good gains as they have underperformed the global equity markets over the last few weeks.” According to him, though overall global sentiment remained weak, the acquisition of Bear Stearns by JPMorgan Chase has brought some relief to the financial markets. “Similarly we saw sectors like realty, banking, capital goods and IT as the best performers during the day’s rally, as these sectors have witnessed strong correction during the recent market fall,” Chakraborty added.

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