During the opening hours of the trading session on Tuesday, the Sensex gradually went up to surpass the psychological 4000 points level and touched the day's high at 4001.98 points. This, however, was attributed to short covering by operators who were not sure of the next course of the market after the spectacular intra-day recovery on Monday. Shortcovering by operators was witnessed in the counters of Hindustan Lever, L&T andMahindra & Mahindra.

However, during the last half-an-hour the market witnessed massive all-round selling pressure in almost all the counters. This led the Sensex to touch the day's low at 3892.30 points, only to close slightly higher at 3901.73 point. Thus on an intra-day basis, the Sensex witnessed a 109.68 points fluctuation on Tuesday.

Market players are confused about the possible path that the market is going to take over the next couple of days and expect rumours to play a major part during the intra-day period.

"The short-term trend of the market will be dictated by the rumour mill which will keep on drowning the market and reviving it and any neagtive rumour will send the bulls scurrying for shelter and safety. The undertone of the market is firm but the uncertainty will plague the market which will rule the fortunes," says Dilip Bhat, a BSE broker.

On Tuesday, software stocks once again came in for heavy beating by the operators. Also market favourites like Satyam Computers and PentafourSoftware witnessed offloading by the institutions and the stocks closed with substantial losses against their respective Monday close. During the end of the session, Pentafour came under heavy selling pressure and was frozen at the lower end of the circuit at Rs 945.90. Among the other market favourites, SBI lost Rs 10 to close at 233.25.

In the GDR market, during the mid-session, the Skindia GDR Index was down 3.11 per cent at 734.76 points. The ITC GDR was down 5.65 per cent, L&T 3.45 per cent, Ranbaxy 4.89 per cent, SBI 4.42 per cent and Bajaj Auto 2.5 per cent.