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Heightened action in technology counters

Sanjiv Shankaran

SIGNIFICANT buying in technology counters helped the market indices finish on a firm note on Tuesday. The BSE Sensex ended the day at 3,407.32 points, up by 88.65 points (2.67 per cent).

One of the reasons for the sharp jump in technology stocks could have been the impending close of National Stock Exchange's (NSE) settlement cycle. NSE's settlement cycle ends on Tuesdays. Following the downward drift in indices in the recent past, the b ig buying on Tuesday could well have been triggered by the need to buy and thus square up short sale positions ahead of the settlement close.

The day's technical indicators present a mixed picture. Mixed because the ratio of advances to declines was positive, while the ratio to new highs to new lows suggested the underlying problem of a weak sentiment.

About 690 stocks advanced as against 368 that declined. On the other hand, as many as 119 stocks hit new lows in relation to only 24 stocks that touched new highs. The aggregate volume was 8.95 crore shares.

In the immediate future, the market sentiment is likely to be weighed down by the fear that Unit Trust of India's (UTI) flagship scheme US-64 is in a spot of bother. US-64's move towards a market-based net asset value (NAV) in the course of the next year may hold a shock or two in store for the market.

The bright spot for the equity market continued to be the inflow of foreign portfolio investment. In June too, the foreign inflows continued to be positive.

Technology stocks cornered the limelight on Tuesday in much the same manner as they did on Monday. However, there was one crucial difference; they recorded huge gains during the day.

Infosys Technologies continued to be at the forefront. The stock closed higher by Rs 227.50 to close at Rs 3,565.90. The accompanying volume was 5.53 lakh shares.

Satyam Computers was not far behind. The stock registered a big jump to end the day at Rs 176.55, a rise of Rs 21.05. The accompanying volume was 95.20 lakh shares.

Global Tele-Systems and Himachal Futuristic were among the gainers. Global ended higher by Rs 17.40 at Rs 126.35. The accompanying volume was 30.33 lakh shares. Himachal Futuristic closed at Rs 74.45, an increase of Rs 10.25. The accompanying volume was 70.77 lakh shares.

G.V. Films continued to move up significantly. The company seems to be sitting on a blockbuster development for the share price ended at Rs 16.95, a rise of Rs 1.25. The accompanying volume too moved up sharply to touch 6.98 lakh shares.

ICICI seemed shake off all talk of asset quality for the day. The stock turned out to be one of the market favourites for the day and closed at Rs 76, an increase of Rs 5.55. The accompanying volume was 7.26 lakh shares.

The losers had one big name: Hindustan Lever. Constant talk of a slowdown in the consumer goods sector seems to be eroding the market value of the company. Notwithstanding Hindustan Lever's top brass' ideas on making rural India more prosperous, investor s seem unimpressed. The stock closed lower at Rs 197.35. The accompanying volume was 9.88 lakh shares.

Saw Pipes market value seems to be sliding down rather fast. This follows a spectacular rise in market value just a while ago. Market ``gravity'' pulled the stock down to Rs 88.75 from the previous day's level of Rs 93. The accompanying volume was 25.53 lakh shares.

Indian Rayon's decision to acquire a controlling stake in PSI Data Systems does not seem to have gone down well with investors. A day after the company announced the big move in information technology, the stock closed lower by Rs 1.30 at Rs 80.25. The d ip in market value came in the backdrop of a volume of 50,681 shares.