Earlier, a technical snag on the BSE during the opening hours resulted in some short sellers being forced to cover their positions in a haste when the bourse opened an hour late. As the BSE closed half-an-hour late to compensate for the time lost in the morning, the Sensex gained almost 40 points during that half-an-hour. HLL was the most prominent among the counters which witnessed heavy buying on the BSE duringthat time and closed at Rs 2696 compared to its NSE close of Rs 2636. Telco and Tisco were the other pivotal counters which also showed substantial price differential among the two exchanges.

During the opening hours a number of operators who had short sold on the BSE and carried forward their positions were caught on the wrong foot as the operators on the NSE went all out to push the prices higher on the latter exchange. This, according to one broker, forced a number of operators to cover their short positions in the counters like Pentafour and Digital, which went up substantially during the day.

On Monday, despite a marginally higher opening at 4728.19 points (also the day's low), the BSE Sensex closed 122.53 point higher at 4832.56 against its Friday close of 4709.93 points. The day's high for the index was at 4839.16 points.

On the other hand, the S&P CNX Nifty on the NSE closed at 1390.20 points, a gain of 15.25 points against its previous close of 1374.95 points. Even though the BSE Sensex closed2.6 per cent higher against a 1.1 per cent rise in the Nifty, the total turnover on NSE was much higher at Rs 2179.55 crore compared to over Rs 1500 crore on the BSE. On the first day of the new 3-day settlement on the NSE, the total turnover in this segment (where only compulsorily demated scrips are allowed) was at Rs 4.11 crore from 1.72 lakh shares. For Tuesday, market players expect the markets to open strong as there is some discrepancy in prices in some of the counters. However, as the trading continues, the market might weaken and close weaker.

According to Rajiv Sampat at Parag Parikh Financial Advisory Services, ``it's time for the day-traders to keep away from the market till the polls are over when the markets is likely to remain volatile.''

On Monday, on the BSE, the Digital scrip touched the day's low at Rs 603 and then hit the upper circuit at Rs 681 before closing at Rs 665 with the all-time high volume of 23.89 lakh shares. On the NSE too, the scrip hit the upper circuit at Rs 683 afterit hit a low of Rs 595. The total turnover in the counter on this bourse was around 30 lakh shares.

What the technicals hold for software stocks

It was the day for software stocks. Reports that software stocks are back in action on the Nasdaq had its impact on the domestic market. Led by Infosys Technologies, the first to hit the upper end of the circuit, nearly 25 software stocks (nearly half of the listed software stocks) hit the ceiling. Almost all the leading software stocks feature in this list.

The all-round buying is good for investors who have a position in these stocks. But for those who want to make a fresh entry, are the current levels appropriate? A close look at the technicals can provide the answer.

Infosys: Closing above its minor resistance of Rs 5,715, the stock has entered virgin territory which is an extremely bullish signal. If this is any indication to go by, the uptrend in this counter is likely to continue. An attractive investment even at thisprice.

Pentafour Software: After a nine-day downtrend, declining from a peak of Rs 660 to Rs 533, the stock has rallied. This rally can simply be termed as a technical correction. For a complete reversal, the stock needs to form a higher bottom. As such, for a fresh entry, one can wait it out to form a higher bottom. And, the chances look bright.

Satyam Computers: The drop in Satyam counter was not as sharp as that of Pentafour. In fact, Satyam Computers appears healthier compared to Pentafour as far as the medium term trend is concerned. However, for fresh entry, one can wait for a higher bottom.

Digital Equipment: It was the most volatile stock in the software segment. For traders, unless it makes a good base, fresh entry is clearly avoided. Since the earlier fall was very sharp and forced the stock into a negative territory, sustaining the current rally would be difficult.

Silverline: Since the rally is of a corrective nature, sustaining it would be aproblem.

Rolta: Similar is the case with Rolta. The stock faces a strong resistance in the range of Rs 148-155. The second hurdlle is at Rs 161. Unless it breaks the Rs 161 level, the trend for the stock will continue to be negative, or at best sideways.

Deepak Singh Tanwar