Sensex up 39 points on back of sustained purchase by foreign funds, speculators

Our Markets Bureau

Mumbai, Jan 3: Bolstered by gains in technology stocks, the Sensex gained 39 points on Thursday, extending its gains for the second consecutive day on sustained buying by foreign funds and speculators. The Sensex would have ended on a stronger note, but due to weak closing of non-tech Sensex heavyweights gains were capped

The Sensex closed up 38.86 points at 3308.02 after opening on a firm note at 3282.68 points. However, the Sensex lost steam in morning trades and touched an intra-day low of 3272.21 points in afternoon trades.

Buying by select private mutual funds and foreign institutional players like government of Singapore and Janus International led to a rally in the Sensex during closing hours to touch an intra-day high of 3309.38 points. On the NSE, S&P CNX closed up 11.50 points at 1072.25 points.

The BSE Teck closed 47.27 points at 986.84 points.

A dealer at a domestic brokerage said: “The rally in software stocks was seen in anticipation of a strong performance in Q3 to December results which is likely to be posted in the next two weeks.”

He said, “Worries of a sharp fall in software exports to the US since the terrorist attacks on the US on September 11 has led to a sharp battering of these stocks, thus making valuations cheap. Also, expectations abound that most frontline software stocks will post decent results and that the terrorists attacks have not impacted fresh orders.”

Technology stocks which rallied sharply on the bourses include NIIT up 10 per cent at Rs 241.30, Zee Telefilms up 10 per cent at Rs 118.70, Mastek up 20 per cent at Rs 281.45 and HCL Infosystems up 10 per cent at Rs 105.60. All these technology stocks hit its respective upper circuit limits.

Among the blue-chip software stocks, Infosys closed up 6.30 per cent at Rs 4,295.70, Satyam up 8.24 per cent at Rs 256.75 , Wipro up 2.88 per cent at Rs 1,678.45.

Select cement stocks that had a smart run include Grasim and Gujarat Ambuja on expectation of rise in December cement sales figures and prices by Rs 7 in Mumbai, effective Tuesday. Losers which put a lid on further gains in the Sensex include, Reliance Petroluem, Reliance Industries, ITC Ltd and HLL.