Reliance Energy’s stock quadrupled in 2007 but the stock dropped over 20% year to date. The popularity of Reliance Energy spilled over to Reliance Power when the Reliance Power IPO of $20.37 billion was oversubscribed on the Bombay and National Stock times by 7.6.
News out of Reliance Energy regarding a stock buyback should bolster shares after the stock has lagged behind key indexes for the entire year. Some traders are now speculating that any renewed confidence in Reliance Energy may spill over into the U.S. markets.
One trader remarked, “Smart money buys groups and with oil over $100 a share and demand for energy good, I don’t see any reason why we shouldn’t be long energy at this time.”