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Partha Pratim Sinha
Mumbai, Aug 16: Led by the stocks which are being promoted to group A of the Bombay Stock Exchange after the recent re-shuffling and also the cement stocks, the markets witnessed good trading activity on Monday. According to brokers, the reshuffle is going to change the outlook of the market vis-a-vis these 27 new entrants, as these are already being re-rated. While the BSE Sensex gained 70.37 points to close at 4558.23 points, the S&P CNX Nifty on the National Stock Exchange closed 18.05 points higher at 1309.90 points.
Combined with the rally in the stocks promoted to group A, the results from the recent exit polls, indicating a majority for the BJP and its alliance in the coming elections, and no bad news coming from the Indo-Pak borders also had a positive effect on the markets.
Monday being the first day of the current settlement, speculators were also taking up positions which gave some impetus to the market, said a broker. According to another broker, however, supply of pivotal scrips from thedomestic institutions, at the higher levels, dampened the sentiment of the market to some extent. Tata Chem was one scrip which witnessed huge supply at a higher level.
The Sensex opened the day on a firm note with a gap (upward) of 73 points at 4560.31 points and during the day, the index inched up to touch the day's high of 4585.39. Thereafter, as the day's trading neared closing, selling pressure took the Sensex down to the day's low of 4548.39 and closed at 4558.23 against Friday's 4487.87 points.
The Nifty, on the other hand, opened marginally higher at 1292.35 (the day's low) and touched the day's high at 1314.15 points. However, the Nifty closed at 1309.90 points, against Friday's 1291.85 points. According to Rajiv Sampat at Parag Parikh Financial Advisory Services, the markets have become ``event driven''.
According to market players, almost all the cement stocks witnessed moderate to heavy activity on both the exchanges. Expectations of a further increase in cement prices coupled with higherdispatches attracted huge buying in the cement counters. As a result, most of the cement stocks - ACC, Grasim, India Cements and Kesoram Industries, hit the upper circuit. L&T and Gujarat Ambuja Cements also recorded gains of more than five per cent.
Apart from the cement stocks, some of the infotech stocks also showed good upward movements, others charted sideways movement. Infosys touched the day's high at Rs 5,690 and with a net gain of Rs 90, it closed the day at Rs 5550. And after going ex-bonus on BSE, Satyam and Pentafour also attracted good buying interest. Apart from these three and Digital Equipment, the new infotech entrants into group A - Silverline, HCL Infosys, Tata Infotech and Tata Elxsi managed to show impressive gains.
Other counters where impressive gains were recorded are BSES, United Phosphorus, Bharat Forge, Telco, Tata Chemicals, Videocon International, Blue Dart, Esab India, Wockhardt, Nicholas Piramal, Blue Star, Vikas WSP and Amaraja Batteries. For Tuesday, in case there is nobad news, ``It is expected to remain steady,'' says Sampat. However, looking at the technicals, some are bullish on the market.
``Going by Monday's closing levels, we are bullish on the market. In case the Sensex crosses the 4575 level tomorrow, we can see the index touching a high of 4650. At the current moment, index heavyweight Hindustan Lever looks attractive and any rally in the stock during the next few sessions would have a positive effect on the Sensex,'' says Chirag Sanghvi at Asit C Mehta Investment Intermediaries. According to a dealer, at the current levels, the pharma stocks are looking good.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.
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