FII buying props Sensex up 15 points

Our Markets Bureau

Mumbai, May 16: HEAVY institutional buying particularly by foreign institutional investors (FIIs) helped the bourses to end in positive territory for the second day in succession on Wednesday.

The benchmark indices, though, remained in a narrow band posting marginal gains. BSE Sensex gained 15 points while S&P CNX Nifty was up 4.50 points.

The US Fed Reserve’s announcement to cut the interest rate for the fifth time firmed up US markets. On the back of it the domestic market opened firm. Sensex opened at 3585.79 as compared to the previous close of 3576.96 which was its intra-day low and touched the day’s high of 3630.26, where it met with some resistance before closing at 3592.06, netting a gain of 15.10 points. Nifty followed suit by gaining 4.50 points to close at 1151.15 as compared to previous close of 1145.30.

JM Mutual Fund dealer Dharmesh Desai said, “The market looks very strong for the momentm, though it traded in a very narrow range on Wednesday. FIIs were very aggressively buying across the sectors, particularly the so called defensive stocks in the old economy sector.” Fears of a stocks crash after the market regulator decided to ban badla from July 2 had already been discounted as FIIs and domestic financial institutions welcomed the Sebi decision.

Another dealer with a domestic brokerage also confirmed that FIIs bought heavily on Wednesday after Fed’s announcement. The FII buying was also promoted because of a firm trend on the Nasdaq on Tuesday night, he added.

Trading turnover at the BSE rose marginally as the sentiments perked up. The turnover at the BSE rose to Rs 1,360.17 crore as compared to Rs 1,315.16 crore registered on Tuesday. Satyam Computer, Zee Telefilms and Infosys Technologies were the most active counters clocking turnovers of more than Rs 100 crore each.

Satyam Computer rose to Rs 245 after its ADS listed at a premium of 15 per cent at NYSE but met with resistance and closed at Rs 224.75 as compared to its previous close of Rs 228.20.

Zee Telefilms was in the limelight with a trading volume of 86.13 lakh shares valued at Rs 103.57 crore. The stock jumped up from Rs 114.85 to a high of Rs 123.90 and closed at Rs 122.20.

Infosys Technologies, however, met with selling pressure and closed down from Tuesday’s close of Rs 3,907.95 to Rs 3,797.45. Philips India, United Phosphorous and Bausch & Lomb were also in demand and were locked in then upper circuit of 16 per cent.

Pharma stocks were on the rise on the back of the optimism that the Centre would soon prune the list of drugs under price control order. Glaxo India, Ranbaxy Laboratories, Cipla, E Merck and Burrough Wellcome — all witnessed modest to sharp rise in the prices with some of them hitting the upper circuit of 8 per cent or more. However, some of the MNCs pharma stocks like Novartis and Smithkline Pharma were down 4.45 per cent and 2.64 per cent respectively at Rs 290.90 and Rs 398, on the news that these companies may not benefit from the new move.

Carrier Aircon was once again stole the show with a gain of about 10 per cent to close at Rs 94.05. The closing price is about to touch the offer price of Rs 100 offered by the US parent.