Mumbai: Powered by a consistent upsurge in key stocks under the lead of cement and
public sector undertakings (PSU) shares, the SENSEX flared up by 1.57 per cent over
the week on the Bombay Stock Exchange (BSE) that witnessed revival of foreign
intelligent investors (FII) activity and selective buying from speculators.
The rally in PSU shares was kindled by strong speculation that there would be sharp
hike in the bidding price of IPCL shares which earlier was expected at around Rs 160
per share while key cement counters hogged the limelight on the fact that the
industry has registered double digit growth in April.
Though negative factors like prevailing fluid political situation arising out of
continuous communal violence in Gujarat coupled with a fresh slide in NASDAQ
Composite Index which has lost considerable ground in the last few weeks were
discounted by the market, stock brokers optimistic of upward trend seemed to be
concerned that the NASDAQ losses would cap any rally in Indian technology stocks.
In the prevailing situation, PSU stocks once again emerged as investors' favourites
for the simple reason that the government which has almost overcome the political
problems arising out of crucial Gujarat issue, is unlikely to delay privatisation of
the sector any more.
Revival of purchases by FIIs has turned out to be the prime positive factor. FIIs
which were net sellers to the tune of Rs 65 crore during last week, have made net
purchases of Rs 135 crore in four sessions between May 6 and 9.
Besides making fairly good purchases in key counters, FIIs and domestic operators
were believed to have picked up sizeable chunk of shares of second-rung low-priced
scrips.
During the week, the BSE Benchmark 30-share Index fluctuated in a range between
3,478.02 and 3,372.24 before ending the week at 3,431.32 as against last weekend's
close of 3,380.61, netting a sharp rise of 50.71 points.
The broad-based BSE-100 index firmed up by 24.82 points to close the week at
1,711.73 from previous weekend's close of 1,686.91.
PTI
