Mumbai, Apr 24: Carryforward rates on the Bombay Stock Exchange (BSE) further dipped to a low of 2 per cent on April 24, before stabilising in the band of 6-8.1 per cent on an average. Brokers attribute the fall in the badla rates to the steep decline in the carry forward positions on the exchange coupled with the rise in the short positions at select heavy weight counters. Of the 148 stocks offered for carry forward top 40 scrips accounted for a badla position of nearly Rs 961 crore, with the gross long positions on the exchange having dipped to below Rs 1,200 crore mark. About 10 heavy weight stocks including HLL, ITC, ACC and Reliance attracted backwardation at the bourse. Mumbai based brokers say the backwardation or `undha badla' mirrors the short positions at these counters which has been on a steady rise during the past few sessions."Despite the political uncertainities the FIIs have been net buyers on the exchanges during the week ended April 23. This is a positive sign. If the problem on thepolitical front is sorted out we should see a 200 points rally from the current levels," BSE treasurer, Jayesh Sheth said.
ACC attracted a backwardation charge of Rs 14.45 on account of the rise in the short positions at the counter. Similarly Hindustan Lever attracted a backwardation cost of Rs 15.21.
Based on the backwardation charges attracted by these and other stocks, market pundits are of the strong opinion that the market is poised for a strong rally as fresh purchases would pour in at these levels.
"The short positions at these counters have superceeded the long positions. Delivery based purchases have also taken place at these counters.
Considering the high backwardation in the midst of falling carry forward rates we should witness fresh buying coupled with short covering," said a BSE broker.
Brokers also highlighted that since the week ended April 30 would witness only three trading sessions on the BSE on account of the two holidays-namely on April 27 & 30, operators would rush to covertheir positions on Monday itself.
Stocks like SBI, MTNL and HPCL where UTI was rumoured to have sold heavily during the week ended April 23, attracted carry forward charges to the tune of 7.50-8.09 per cent on an average.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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