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Our Market Bureau
Mumbai, Oct 23: The downgrading of the country's sovereign rating by international credit rating agency Standard & Poor's did not have much of an impact on share prices as reports of the government coming out with an announcement on share buy-back perked up the sentiment.
Union finance minister, Yashwant Sinha's statement in Mumbai that the downgrade would have no impact on the economy too helped in providing a booster to the market sentiment.
Rumours of an FII picking up about 5 lakh shares of ITC added to the good news and led the Sensex to register a gain of about 20 points. The Sensex opened at 2,757.04 points, saw a high of 2,798.88 and touched a low of 2,741.22 before closing at 2,784.46 points compared to its previous close of 2,764.16 points registering a net rise of 20.30 points. The S&P CNX Nifty also gained 5.75 points to close at 817.35 points.
After initial lows, equities staged a modest recovery on the back of squaring up on the last day of the settlement at the Bombay StockExchange.
"BSE opened around 2,747.09 on bear pressure but later good support by FIIs to cover up oversold positions kept the market steady. Persistent shortcovering by FIIs and support by domestic operators with buying at lower levels kept the Sensex from falling", a BSE broker said.
A further fall in the Sensex was also arrested as a huge chunk of around 4 to 5 lakh shares of ITC were rumoured to have been bought by a leading FII which has till now been in the news for having been a heavy seller at the bourses. Another top FII, Capital International was rumoured to have sold huge chunks of HLL which led to fall in the scrip price by Rs 66 to close at Rs 1,585 from its previous close of Rs 1,651 on the BSE. The scrip had registered a loss on the National Stock Exchange (NSE) on Thursday.
"Short-covering by operators on the last day of the current trading cycle and buying support by domestic institutions in index scrips resisted a fall in the market", said Chetan Shah, a BSE broker.
According tofigures collated by NSE FIIs were net sellers to the tune of Rs 11.95 crore with FIs net sellers at Rs 6.84 crore.
FIIs sold shares of ITC, Hindalco and HLL and continued to make purchases in heavy weighted shares for squaring up positions on the last day of the current account on the BSE. Speculators also found themselves caught in short positions owing to a number of holidays during the week.
The offshore fund of Canbank mutual fund is reported to have sold 25,000 shares of Dr Reddy's Lab and bought 2 lakh shares of Telco. Capital International is reported to have sold about 40,000 shares of HLL. SBI mutual fund is rumoured to have bought Satyam Computers (25,000), Zee telefilms and Bausch & Lomb (60,000). The Templeton AMC is rumoured to have bought 1.75 lakh shares of MTNL on Tuesday.
A negotiated deal of around 1.67 lakh shares of Grasim at a price of Rs 140-145 reportedly took place in the market. Another negotiated deal was witnessed in the scrip of Vashisht Detergents at a price of Rs 54-55 pershare.
UTI is reported to have made token purchases at the counters of Nestle, SBI and Satyam Computers with the UTI offshore fund selling Hoechst Marion Russel. Local institutions evinced buying interest in software stocks like Infosys Technologies, NIIT and Satyam Computers. LIC the insurance major bought SBI, Reliance and Telco.
The Over The Counter Exchange of India (OTCEI) saw a turnover of Rs 2.5 crore today being the first day of fulfledged trading on OTCEI. 48 brokers logged on to OTCEI for trading. "We will see a lot of trading from Monday onwards as there were a number of holidays this week with hardly much positions to shift to OTCEI", said Joseph Bosco, managing director, OTCEI.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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