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Sensex gains 52 points on institutional buying, short covering

The market closed on a firm note on Friday on buying support in select Old as well as New Economy stocks.

After moving in a range of 80 points, the Bombay Stock Exchange (BSE) 30-share Sensitive Index (Sensex) settled with a gain of 51.92 points to 3,456.78.

Foreign institutional investors (FIIs) turned buyers in some New Economy stocks. Today, being the last day of the financial year for Unit Trust of India (UTI), the country's largest mutual fund was believed to have made purchases in heavyweight stocks to prop up net asset values of its schemes, informed players.

Meanwhile, speculators unwound their large positions in some stocks (positions taken after 14 May 2001) ahead of the 2 July 2001 deadline banning carry-forward trading. The surge in the Sensex was partly attributed to the covering of short positions.

The Sensex opened with a gap of 2 points at 3,406.79. It sank into the red in early trades and touched the day's low of 3,394.91 at 10:45 IST. However, renewed institutional buying and short- covering in heavyweight pivotals pushed the Sensex into the positive zone. It touched a high of 3,474.91 at 14:30 IST. The Sensex finally settled at Rs 3,456.78, gaining 51.92 points or 1.52% over its previous close.

The National Stock Exchange's S & P CNX Nifty Index gained 13.90 points to 1,107.90.

Turnover on BSE dropped further to Rs 1,196.72 crore (Rs 1,016.03 crore on 28 June 2001) from 8.28 crore shares traded. Of the 1,509 issues traded, advances outnumbered declines with 740 gainers and 622 losers. 147 issues remained unchanged.

Pivotal stocks

Pivotals displayed mixed trends.

Bhel (up 7.20% to Rs 176.40) rose further on institutional buying. Local as well as foreign institutions were believed to have been active on the counter. The state-run electrical equipment major has recently bagged a Rs 285-crore order for the supply of gas turbines for a power project in Gujarat.

Institutional buying was also said to have taken place in heavyweights like Hindustan Lever (up 3.30% to Rs 203.50) and Infosys Technologies (up 4.31% to Rs 3,761.35).

Petrochemicals giant Reliance Industries (RIL) moved up from a low of Rs 360.20 to Rs 373.80 before settling at Rs 369.50, gaining 1.95% over its previous close. Foreign brokerage houses like Jardine Fleming and C.L. Securities were said to have been active on the RIL counter. Over 13 lakh RIL shares were traded on BSE.

Media major Zee Telefilms (up 4.06% to Rs 119.10) recovered from an intra-day low of Rs 109.65 on renewed buying support. Over 42 lakh Zee shares were traded on BSE.

Among the other tech pivotals, NIIT came off from a high of Rs 404.50 to Rs 366 before settling at Rs 381.40, gaining 2.65% over its previous close. The stock had witnessed substantial institutional activity recently.

Satyam Computer slipped from a high of Rs 180.80 to Rs 168.05 before settling at Rs 170.45, still gaining a marginal 0.38% over its previous close. Over 51 lakh Satyam shares were traded on BSE.

Hindalco displayed unusual volatility. After moving in a narrow range for the better part of the session, the aluminum major spurted to a high of Rs 859.70 towards the close. However, it declined on fresh selling at higher levels. The stock ended at Rs 834.40, gaining 4.29% over its previous close.

Dr Reddy's Laboratories (DRL) was also volatile. The stock opened weak after the Reserve Bank of India (RBI) said late on Thursday that investment by FIIs in the company was near the approved ceiling. The apex bank prohibited FIIs from fresh buying of DRL shares without its approval. However, after touching a low of Rs 1,555, the stock bounced back to a high of Rs 1,655 as the company clarified that the FII limit was not yet reached. Eventually, the stock settled at Rs 1,610.25, gaining 2.06% over its previous close.

Cipla (up 2.87% to Rs 1,143.30) also gained ground on institutional buying.

Nestle (up 2.38% to Rs 558), HPCL (up 1.35% to Rs 158.10), Colgate (up 1.24% to Rs 163) and MTNL (up 1% to Rs 126.25) recorded modest gains.

Meanwhile, pharmaceutical pivotals like Ranbaxy Laboratories (down 3.68% to Rs 481.20) and Glaxo (down 3.30% to Rs 316.25) slipped on unwinding of long positions by speculators as well as profit- booking, after recent gains.

M & M (down 2.96% to Rs 80.20) also declined on unwinding of long positions. The tractors and utility vehicles major touched a new 8-year low of Rs 79.20 towards the close of the session.

ITC came off from a high of Rs 777.95 to a low of Rs 747.20 on unwinding. It settled at Rs 754.95, losing 2.24% from its previous close.

Stocks like Castrol (down 2.52% to Rs 215.05), ICICI (down 1.91% to Rs 72), Tata Steel (down 1.40% to Rs 115.80), Reliance Petroleum (down 0.84% to Rs 47) and Telco (down 0.24% to Rs 62.55) settled in the red.

Tech stocks

Among non-Sensex tech stocks, R. S. Software (Rs 66.05), Aftek Infosys (Rs 162.40), Kale Consultants (Rs 42.55) and Orient Information (Rs 43.75) hit 16% upper limit of the circuit breaker on buying by speculators.

Infotech Enterprises (up 14.03% to Rs 111.35), Pentasoft Technologies (up 10.19% to Rs 74.60) and HCL Technologies (up 9.51% to Rs 293.15) exceeded 8% upper limit.

Ramco Systems (Rs 315.10), Geometric Software (Rs 77.50), VisualSoft (Rs 91.80), Subex Systems (Rs 55.15) and Soffia Software (Rs 33.40) hit 8% upper limit.

Information Technologies (up 7.49% to Rs 55.95) was firm ahead of the announcement of its FY 2001 results. After market hours, the infotech company of the Usha group posted a 49.43% drop in net profit to Rs 35.55 crore (Rs 70.30 crore) on sales of Rs 192.54 crore (Rs 237.23 crore).

Selective buying was seen in other tech stocks like Aztec Software, Sierra Optima, Digital Equipment, Fujitsu ICIM, DSQ Software, Mascot Systems, Trigyn Technologies, Sonata Software, Hughes Software, SSI, Mastek, Wipro, Rolta India and Silverline Technologies.

On the other hand, Mphasis BFL, PSI Data Systems, Aptech, HCL Infosystems, Tata Infotech and Polaris Software settled in the red.

Telecom stocks

Among telecom stocks, Global Tele-Systems (GTL) moved up from an intra-day low of Rs 150.20 to hit 16% upper limit of the circuit breaker at Rs 175.75. The stock settled at Rs 175.60, gaining 15.87% from its previous close. While institutional buying was believed to have taken place on the counter, some short-covering was also reported. Close to 31 lakh GTL shares were traded on BSE.

HFCL also bounced back from an intra-day low of Rs 81 to a high of Rs 92.60 before settling at Rs 87, gaining 4.25% over its previous close. The stock topped volumes on BSE with close to 57 lakh shares being traded.

Among the other telecom stocks, Krone Communications (Rs 127.50) hit 8% upper limit of the circuit breaker on buying by speculators.

Punjab Communications (up 12.78% to Rs 42.85), Goldstone Technologies (up 9.43% to Rs 26.10) and Tata Telecom (up 8.61% to Rs 81.95) crossed 8% upper limit of the circuit breaker.

Among optical fibre makers, while Aksh Optifibre (Rs 135.10) hit 8% upper limit, Sterlite Optical (up 2.02% to Rs 339.20) recorded smart gains.

Shyam Telecom (up 4.22% to Rs 62.95) gained ground after the company posted impressive FY 2001 results on Thursday. For the year ended 31 March 2001, the company recorded a net profit of Rs 16.37 crore (Rs 4.45 crore) for 18 months) on sales of Rs 215.34 crore (Rs 111.72 crore).

Buying was also seen in other telecom stocks like Birla Ericsson, Mobile Telecom, Framatome Connectors, Vindhya Telelink and Usha Beltron.

Surana Telecom, VSNL, ITI and Finolex Cables ended in the red.

Media stocks

Among media stocks, Crest Communications (Rs 66.40) hit 16% upper limit of the circuit breaker after posting impressive yearly results. For the year ended 31 March 2001, the animation film maker posted a 117.30% rise in net profit to Rs 5.10 crore (Rs 2.34 crore) on sales of Rs 24.30 crore (Rs 16.13 crore).

Cinevista Communications (up 4.01% to Rs 44.05) recorded gains even after the company posted disappointing FY 2001 results. For the year ended 31 March 2001, the TV content provider posted a net loss of Rs 11.99 crore (net profit Rs 8.78 crore) on sales of Rs 39.67 crore (Rs 43.92 crore).

Buying was also seen in other media stocks like Creative Eye, Pritish Nandy Communications, Jain Studios, Tips Industries, Balaji Telefilms, Pentamedia Graphics, Padmalaya Telefilms, Sri Adhikari Brothers, Adlabs Films, TV 18 and Mukta Arts.

Banking stocks

Bank of Baroda (up 5.66% to Rs 56) gained ground after the bank announced its FY 2001 results on Thursday. For the year ended 31 March 2001, the public sector bank posted a net profit of Rs 274.66 crore (Rs 502.77 crore) on an income of Rs 6,463.62 crore (Rs 5,860.80 crore). For the Q4 ended 31 March 2001, it posted a net loss of Rs 154.55 crore (net profit Rs 130.77 crore) on an income of Rs 1,735.84 crore (Rs 1,622.32 crore).

Selective buying was seen in Dhanalakshmi Bank, Bank of Rajasthan, Corporation Bank, UTI Bank, Global Trust Bank, HDFC, J & K Bank, Federal Bank, Oriental Bank of Commerce, IndusInd Bank and Bank of Punjab.

On the other hand, United Western Bank, ICICI Bank, HDFC Bank and IDBI Bank settled in the negative territory.

Pharmaceutical stocks

Among non-Sensex pharmaceutical stocks, Orchid Chemicals (up 10.70% to Rs 88.45) crossed 8% upper limit of the circuit breaker.

Krebs Biochem (Rs 90.70), Suven Pharma (Rs 115.90) and Torrent Pharma (Rs 116.60) hit 8% upper limit.

Buying was also seen in other pharmaceutical stocks like Shasun Chemicals, Abbott Laboratories, Wyeth Lederle, Nicholas Piramal, Kopran, Lupin Laboratories, German Remedies, Pfizer, Burroughs Wellcome, Panacea Biotech and Morepen Laboratories.

Novartis (down 4.15% to Rs 230.75) slipped ahead of the announcement of its FY 2001 results. For the year ended 31 March 2001, the life science major posted a net profit of Rs 52.66 crore (Rs 103.42 crore) on sales of Rs 403.33 crore (Rs 824.35 crore).

Selling was also seen in Sun Pharma, Aurobindo Pharma, Glenmark Pharma, SmithKline Beecham Pharma, Ipca Laboratories, Hoechst Marion Roussel, E. Merck, Cadila Healthcare, Alembic, Knoll Pharma, Parke Davis, Rhone Poulenc and Duphar Pharma.

Side counters

Among side counters, Vikas WSP (up 13.87% to Rs 21.75), TVS Electronics (up 14.38% to Rs 35) and DSQ Biotech (up 9.44% to Rs 35.35) crossed 8% upper limit of the circuit breaker.

Amtek India (Rs 51.45), Emco (Rs 35.35) and Century Enka (Rs 52.40) hit 8% upper limit.

Buying was also seen on other side counters like Tata Power, Voltas, Trent, Indo-Gulf Corp, Adani Exports, Bayer India, Clariant India, Foseco India, Bharat Forge, TVS Suzuki, ABB, Syngenta India, Apollo Tyres, Esab India, Saw Pipes, Ashok Leyland, Shree Rama Multitech and Punjab Tractors.

On the other hand, HEG (Rs 26.70) and Ceat (Rs 17.50) hit 8% lower limit of the circuit breaker.

Selling was seen in Apollo Hospital, Mirc Electronics, Ingersoll Rand, Modi Rubber, Thermax, Raymond, ONGC, Philips India, Ballarpur Industries, Sesa Goa, Max India, Jaiprakash Industries, Jindal Steel, Cummins India, Titan Industries, IPCL, Atlas Copco, BPL, Essel Packaging, IBP, Bharat Electronics and Exide Industries.

Source: www.capitalmarket.com

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