Financial Daily from THE HINDU group of publications
Wednesday, May 05, 2004
Columns - Sensor
Sensex recoups losses on all-round buying
AFTER steadily plummeting in the last couple of trading sessions, the markets bounced back with renewed vigour on Tuesday.
The Sensex, which shed 70 points on Monday, soared 62 points on the back of across the board rally, to close at 5647.15 points up from the previous close of 5585 points. The Nifty also appreciated smartly and ended the day at 1793.10, up from its previous close of 1766.70 points. Cement, auto, technology and banking stocks were the flavour of the day, with buying interest picking up in steel and aluminium stocks as well.
Many stocks that had declined on Monday, recovered their losses on Tuesday on the back of value buying. The Sensex opened the trading session on a high note at 5616.41 points and remained in the positive territory for the entire trading session. The mood in the market was decidedly bullish with 72 per cent of the stocks registering an appreciation in prices.
Of the stocks constituting the Sensex, 23 advanced while 7 declined. Although the benchmark index rose by about 1.11 per cent, the buying interest in the key index heavyweights remained subdued.
ONGC and SBI, which together have a little more than 10 per cent weightage in the Sensex, posted impressive gains on the back of value buying. Both these stocks had registered sharp declines on Monday.
Cement stocks rose, fuelled by the higher dispatches reported by the cement majors in April. ACC, Gujarat Ambuja and L&T ended the day with impressive gains while Grasim ended the day marginally lower. India Cements, Madras Cements, Mangalam Cements, Prism Cements and Mysore Cements were also among the top gainers.
Buying interest was also prominent in tech stocks. i-flex Solutions, Polaris Software, Wipro and Patni Computers gained more than 2 per cent. Satyam Computer appreciated by a sharp four per cent. This appreciation in stock prices could be viewed in light of the strengthening dollar.
Banking stocks, which took a beating on Monday, were the hot favourites. Allahabad Bank attracted heavy buying interest, appreciating by Rs 6 to close at Rs 43.85. This comes on the back of impressive financial results that the bank declared for the quarter ended March. The bank is also considering another equity issue in the order of Rs 100 crore.
Other stocks that gained included UCO bank, Canara bank, Indian Overseas Bank, Andhra bank, Vijaya Bank and Oriental Bank of Commerce.
In the auto sector, the stock of Mahindra & Mahindra spurted by Rs 13.35 to close at Rs 464.85. This could be viewed in the backdrop of the company's improved offtake in April by about 43 per cent. TVS Motors also gained sharply. The sales of the Scooty have crossed the one million mark while the sales of the newly-launched Centra have already crossed the 50,000-mark.
Steel and aluminium stocks, which have been on the losing end owing to fears of a slow down in China's economy, recovered on Tuesday. Tata Steel and Hindalco ended the day higher by 2.16 percent and 3.42 percent respectively. Shipping stocks also recovered from their fall on Monday.
Sugar stocks continued their unabated rise. Stocks that gained included Dhampur Sugar, Balrampur Chini and Bajaj Hindusthan to name a few. Bajaj Hindusthan gained Rs 3.05 to close at Rs 64.70. The company has bid for 24 sugar mills, which are being divested by the Government of Uttar Pradesh. Textile stocks remain on the uptrend. Alok Industries, Indian Rayon, Mahavir Spinning, Welspun India, Bombay Dyeing, Zodiac Clothing and Raymond apparel were among the stocks that gained. Indo-Rama Synthetics also gained marginally following its announcement of a hike in prices.
The stock of Radico Khaitan gained Rs 2.2 to close at Rs 120.15. The company has recommended a dividend of Rs 2 per share of Rs 10 each.
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