Additionally, FII investment figures have also turned positive for Wednesday, after a combined selling to the tune of Rs 919 crore during the three previous sessions. And with a little hope from the overseas Nasdaq - which was already up 95 points at the end of the first hour of trading- a rally is in the offing on Friday, feel market players.

Technical analysts also see a corrective rally from the current level. Along with these, since short selling positions on the BSE are also at the previous day's level, brokers expect short covering on Friday would also result in pushing up the prices. On Thursday, after touching a low of 4538.95, the Sensex closed at 4575.67, a net loss of 40.34 points over its previous close.

On Thursday, most of the frontline software stocks - Infosys, NIIT and Satyam - closed higher, although the gains were marginal. But this has enthused the broking community who feel that the market has bottomed out and buying interest is likely to revive on Friday, despite it being the last day of trading in the current account on the BSE. Also, according to dealers, there is some revival in institutional buying in a number of frontline stocks.

On the FII investment front, net investment figures for Wednesday shows a turn towards positive with an inflow of Rs 180 crore.

Begining last Friday, the FIIs had sold equities worth Rs 920 crore in the market which had a dampening effect, mainly in the software counters.

Technically also the market is ready for a corrective rally, feel market players. ``The Sensex is ready for a 200 point corrective rally,'' said Hanuman Bhatia at Parag Parikh Financial Advisory Services.

BSE's long-short figures for Thursday show that while the long positions are almost at the previous day's levels, short positions have gone up only marginally. But the strengths displayed by the software counters during the end of the session, along with other positives, point towards a good opening for the market. According to a dealer with a local brokerage, in acse the market can maintain its level in afternoon trades as well, we can expect short coverings to take place. ``In turn this will again push the prices up during the end session,'' the dealer added.

On Thursday, cement stocks were the main victims. L&T lost 14 per cent. Grasim also lost more than 8 per cent. Other stocks like ACC, India Cements, and Gujarat Ambuja also did poorly. L&T recorded huge trading volume of 66 lakh shares-a 11-month high. Meanwhile, other key stocks in the non-IT category, including ITC, HLL and SBI also remained under selling pressure. Reliance showed volatile moves, and after dipping to a low of Rs 347, it recovered to Rs 361. As for the software stocks, sentiment improved in the second half. Stocks like NIIT, HFCL, and Satyam Computers triggered the recovery. The Sensex opened at 4592.28 points, touched a peak of 4634.46 points, and closed at 4575.67 point.

The low for the day was 4538.95 points. On the other hand, the S&P CNX Nifty lost 11 points, and closed at 1425.25 points. While the low for the day was 1416 points, the high for the day was 1443.25 points.

On the BSE, the number of advances stood at 573 points and the number of declines at 860. Around 170 stocks remained unchanged. The trading volume on both exchanges remained at reasonable levels. It stood at Rs 3041 crore on the BSE and the corresponding figure on the NSE stood at Rs 4483 crore.

Meanwhile stocks which gained more than 7.9 per cent were HDFC, Bombay Dyeing, Elbee Services, Adam Comsoft, Nat Peroxide, West Hatch. Other gainers for the day were NIIT, E Merck, Denim Ent, Ram Info, Tata Honey, Hotel Leela, Movilex Irr, Shetron, VIP, Sab Nife.

At the same time, stocks which dipped more than 7.9 per cent were L&T, Grasim, Castrol, McDowell, Leading Edge, Frontier Info, Sibar Soft, Jupiter Orga, Odyssey Tech, Mobile Tele. Other losers for the day were Pun Tractors, Padmini Poly, TV 18, Smithkline Con, Nalco, SQL Star, Adani Exports, VJIL, Colour Chips, Lippi System, Anco Com.