NEW DELHI, May 29: Stocks rebounded to pare earlier losses completely on the stock market on Friday as domestic financial institutions, led by Unit Trust of India (UTI) stepped into the market towards the middle of session with sizeable buy orders. However, closing rates were still lower.Stock brokers said, market started-off on weak note due to nervous selling in the wake of Pakistan nuclear tests made a significant recovery after the presentation of railway budget in which there was no increase in freight rates.
They said Friday being the last session of current settlement, players were squaring-up their positions which forced them to keep their activity restricted. Despite poor results of Tata Steel and Associated Cement, share prices recovered largely on huge short-covering at lower prices.
Mirroring the wild swings in index-linked stock prices, the benchmark index which plunged to 794 points (intra-session) bounced back to close at 810.45 points, showing a marginal drop of 1.50 points. ''Playersare now waiting for the general budget slated for Monday would determine the market's fate'', said a stock broker on the DSE.
``No general hike in freight in the railway budget also led to a late recovery in stock prices, particularly cements and steels'', said another broker.
The tobacco giant, ITC Ltd after opening lower at Rs 700 nose-dived to Rs 670 to recent lows following nervous selling by foreign investors and bear operators. However, large-scale short-covering by speculators lifted stock prices to Rs 704 before closing at Rs 686.50, showing a fall of Rs 26.50.
Tata Steel which recorded a 31 per cent drop in the net profits at Rs 322 crore, attracted large-scale speculative buying and recovered by Rs 14.05 to Rs 150.40, stock brokers said, though the company has posted lower earnings but are well above the market's expectations.
Associated Cement Co gained Rs 14.70 at Rs 1695.05 on speculators buying coupled with short-covering.
Reliance Industries late buying managed to close a shade higherat Rs 168.30 against previous close of Rs 166.75. Automobile stocks like Hero Honda fell by Rs 12.8O to Rs 1067.15, Bajaj Auto Ltd was down Rs 16.50 at Rs 606, LML fell Rs 11.85 to Rs 125 and TELCO lost Rs 2 to Rs 245.
Other weak spots were Apollo Tyres, HDFC Bank, State Bank of India, HCL Infosystems, Castrol and Carrier Aircon on selling. Undercurrent at close turned better and volume of business good.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
