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Buying activity that picked up steam during the latter half of the day, continued right till the end, enabling indices in the Indian stock market to close strongly in the positive today. BSE-Sensex edged higher by around 200 points while gains on the NSE-Nifty stood at around 53 points. The BSE-Midcap and BSE-Small cap indices also flexed their muscles and closed higher by more than 1% each. Around four stocks gained for every one that closed the day in the negative on the Sensex today.

As far as Asian indices are concerned, they closed mostly in the red today. Europe on the other hand is witnessing buying interest currently. The rupee was placed at 45.7 to the dollar at the time of writing.

After falling four weeks in a row for only the second time since the Lehman crisis erupted, the markets finally found their footing today as seen by the strong closing witnessed. Today's buying we believe could mainly be on account of bargain hunting as the decline of the past few weeks made stocks look attractive from a long term perspective. Whether the trend will last is anybody's guess but even at these levels, the long term investor is likely to make good returns provided he invests in fundamentally sound stocks run by strong management team.

Power equipment major BHEL closed strongly today with gains in the region of 2%. As per reports, the state owned company is targeting a net worth in the region of Rs 238 bn in the current fiscal as the same will increase the company's prospects of bagging the prestigious Maharatna status. Once this target is reached, the company will have an average networth of over Rs 150 bn for three straight years, one of the considerations needed for the Maharatna status. It should be noted that a Maharatna company has the freedom to take decisions on investments to the tune of Rs 50 bn. It need not take the government's approval for the same. Currently, BHEL is a Navratna company and has the freedom to take investment decision of only upto Rs 10 bn. The Maharatna status will therefore enable the company to pursue acquisitions more aggressively.

Another PSU that saw a very strong buying interest was steel major SAIL. The stock surged around 7% today. After already embarking on a huge expansion plan to the tune of Rs 700 bn, SAIL will further invest Rs 102 bn to develop mines so that increased raw material requirement can be taken care of. It should be noted that post expansion, the company's iron ore requirement would increase to Rs 39 m tonnes from the current levels of around 23 m tonnes. Investment towards mine development is therefore planned to address this issue. The company runs 7 major ore mines presently, four of which are in Jharkhand and three in Orissa.

Source: India Markets Monday Wrap-Up: Buying Makes a Comeback