The Hindu Business Line : Institutional support props up Sensex in last hours

HESITANCY amongst investors continued to influence the performance of the major stock indices on Tuesday. The investment climate at the stock markets seemed to have been influenced by the sustained lack of any clear positive signals.

Despite the available indicators pointing to a reasonably good performance for the corporate sector during the first two quarters of the current fiscal, the continued rise in inflation and the possible fallout it may have on interest rates and corporate bottomlines has been affecting trading sentiment at the bourses during the last few weeks.

Click here for table

The lack of support at the markets was evident right after the opening of the session on both the BSE and the NSE. Trading volumes during the first couple of hours were low.

The uncertain sentiment at the markets and the fluctuating support levels during Tuesday's session meant that a number of stocks' valuations also yo-yoed and witnessed large swings between their intra-day highs and intra-day lows.

Despite the hesitant trading, Tuesday's closing was in the positive, due largely to institutional support that kicked in towards the end of the session.

Increased buying in key index constituents and sector-specific stocks such as in the automotive, banking, energy, commodity, FMCG and information technology segments, helped pull up the indices into the black after the initial dive into the red during the opening hour of the trading session.

However, there were a few stocks from these sectors that were in the red. Also telecommunications and entertainment stocks were hit due to heavy selling pressure during Tuesday's session.

At the BSE, the 30-share Sensitive Index (Sensex) hit a high of 5,270 points during mid-session, after seeing a low of 5,240 points and eventually closed the day at 5,264 points, an increase of about 18 points over the previous close. There were an equal number of stocks whose valuations either advanced or declined during the day. Traded value of Sensex stocks stood at Rs 693 crore.

Amongst the traditional Sensex heavyweights that advanced on Tuesday were ACC (up 0.5 per cent), HDFC (up 0.4 per cent), ITC (up 0.7 per cent), Reliance Industries (up 1.65 per cent), HLL (up 2.64 per cent), State Bank of India (up 1.46 per cent) and Tata Motors.

The other gainers were BHEL, Dr Reddy's Laboratories, Gujarat Ambuja Cements, HDFC Bank, Hero Honda Motors, Infosys Technologies, Tata Steel and Wipro.

The stocks that witnessed a decline in valuations were Bajaj Auto (down 1.44 per cent), Bharti TeleVentures (down one per cent), Cipla (down 1.02 per cent), Grasim Industries, Hindalco, HPCL, ICICI Bank, MTNL (down by a huge 3.8 per cent), Maruti Udyog, ONGC, Ranbaxy Lab, Reliance Energy, Satyam Computer, Tata Power and Zee Telefilms.

Zee, which had gained marginally during Monday's session after making the winning bid to bag the telecast rights from BCCI for all the cricket matches played in India during the next four years, came under selling pressure from investors who were probably worried over the profitability of the company after the huge payout that the bid will require.

The possibility of litigation by competing specialised sports entertainment companies that could potentially challenge the award of telecast rights also seemed to affected trading sentiment in the stock on Tuesday.

Other entertainment companies' stocks that came under pressure included Balaji Telefilms and ETC Network. Television Eighteen was the exception to this trend and posted a 0.8 per cent jump in valuation on Tuesday.

Apart from software bell-weathers Infosys and Wipro, the other IT stocks that were seen closing higher were HCL Technologies, i-flex, Mastek, Moser Baer, Mphasis BFL and Polaris Labs.

The possibility of the monsoon stabilising and with indications that the spread and precipitation has improved during the last few weeks, tractor stocks were in the limelight on Tuesday. Amongst the gainers were Escorts (up nearly five per cent) and Punjab Tractors (up 2.44 per cent). However, tractor market leader Mahindra & Mahindra was down marginally at Rs 442.

More Stories on : Stock Markets | Commentary | Sensor

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Govt borrowings in April-Sept down at Rs 55,000 cr

Religion is the word

The five rupee FMCG lure

Chandra leads from front as Zee pads up

Ministry proposes EPF investment in equities

Institutional support props up Sensex in last hours

Unique ID number extended to corporates

It's back home for textile exporters as quotas go