Markets rise by another 3 pc

Markets rise by another 3 pc
ENS ECONOMIC BUREAU

MUMBAI, MAY 5: Stock markets ended strong for the second day running, led by institutional buying in technology sector and select heavyweights. The benchmark Bombay Stock Exchange (BSE) Sensex finished 3.07 per cent, or 139.96 points, higher at 4,693.88. The National Stock Exchange Nifty index gained 2.71 per cent or 37.35 points to 1,417.90.

The sentiment was strong after Thursday's five per cent jump in the BSE Sensex due to tax breaks announced for some sectors by the government, dealers said. They said investors also lauded the government's willingness to push ahead with difficult reforms by getting politically-sensitive subsidy cuts passed by the parliament on Thursday.

As many as 16 of the 34 leading software shares ended either limit-up 12 per cent or close to it on institutional buying, dealers said. Sector leader Infosys Technologies ended up 4.01 per cent at Rs 8,5O0, Satyam Computer 12 per cent at Rs 3,274.05, Wipro 9.36 per cent at Rs 3,229.45 and SSI 12 per cent at Rs 3,418.15

Heavyweight Hindustan Lever ended 5.4 per cent higher at Rs 2,540. ``The markets remained firm on Friday but closed even higher due to end of settlement considerations. After Thursday's 219 points rally in the Sensex, the market today opened around 50 points up but gained momentum as the trading progressed. For Monday also, market players expect a strong trend as the supply of stocks from the retail mass has declined substantially. Also the badla rate for Saturday's carry forward session is likely to remain around last week's level only,'' dealers said.

The gains in the Friday's market is mainly attributed to the all-round buying in pivotals. However, according to dealers, a substantial rise in the scrips is also due to short covering. ``After the Sensex had touched its recent low at around the 4100-level on Wednesday, lot of people went short and they had to cover their positions,'' said a dealer.

FIIs made aggressive purchases and were reportedly net buyers in key scrips like Digital Equip, HFCL, SSI Ltd, Global Telesystems, Satyam Computer, Infosys Tech, Pentamedia, NIIT, Silverline and others from the cash section.Domestic financial institutions too picked up stocks which were generally neglected in the current rally. However, shares like Grasim, Indian Hotel, HPCL, BPCL, GACL, Cipla and HDFC suffered a setback on profit selling.

Almost 90 per cent of the software stocks managed to hit the 8 per cent limit on Friday. Also a large number of stocks managed to close at 12 per cent upper limit where the enhanced limit is applicable. Buying interest was also evident on pharma counters. The sentiment also had an impact on pivotals where investment buying took place. Stocks like Telco, L&T, Tisco, Bhel and HLL reported strong buying. Reliance was the only counter which remained dull and showed a negative close.