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Saturday, Jan 26, 2002

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Fears of R-Day trouble affect sentiment

Reshma Krishnan

THE stock market that has been quite fickle in the past few trading sessions has finally found some direction albeit southwards. This fall, second day in a row on Friday, could be on the back of fears of potential trouble during the Republic Day celebrations on Saturday.

The 30-share, Bombay Stock Exchange Sensex, closed down by 0.76 per cent, which is 25.49 points to end the week at 3332.30 points from the previous days close of 3357.79 points. The index opened at 3358.2 points and traded within a range of 39.93 points between an intra-day high of 3366 points and a low of 3326.07 points.

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The broad market trend (new highs to new lows), which usually indicates the underlying market sentiment was finally reflective of the losses made at the bourse on Friday as it turned negative for the first time this week. There were 14 new highs in comparison to 22 new lows. The undertone had remained positive since the beginning of the week despite declines during a couple of trading sessions. The advance/decline ratio was negative as the number of issues advanced in value was 515 compared to 573 issues that declined.

The market was not in favour of old economy stocks. It could have been a case of profit-booking following a rally in expectations of strong performances by key companies for the quarter. They losers were the likes of Hero Honda, ITC, and United Breweries. The gainers were Bayer India, Hindalco, HDFC and Novartis. ITC, Cipla and Infosys Technologies were among the Sensex constituents that saw a fall in value.

Hero Honda Motors, country's biggest motorcycle maker, saw itself out of investor favour during the day's trading. The share dropped by Rs 14.15 to end the day at Rs 317.85 from the previous day's close of Rs 332. Trading volumes stood at 1.09 lakh shares.

Drug maker Novartis India on the other hand saw a good day. The stock rose as much as 4.2 per cent, up by Rs 7.75, to end at Rs 236.20 from the previous day's close of Rs 228.45. This rise could have come after the company reported that its net profit doubled in October-December from a year ago. Novartis said its net profit rose to Rs 17.53 crore from Rs 8.73 crore. Net sales edged up to Rs 125 crore from Rs 123 crore. Trading volumes stood at 50,509 shares.

ICI India, a chemicals maker, also had its day at the bourses. The stock went up by Rs 4.04 to end the day at Rs 74.05 from the previous days close of Rs 70. The rise in share price could have been fuelled by the news that the company has agreed to sell its pharmaceuticals unit to Nicholas Piramal for Rs 70 crore.

ICI India's pharmaceuticals business operates in the cardiovascular and anaesthesia segments and had sales of Rs 69 crore for the financial year ended March 2001. Trading volumes surged to 17,919 shares from 2,334 shares traded on the previous day.

Software maker Mascot Systems was not as lucky. It's stock fell by Rs 7.45 to end at Rs 187.20 from the previous day's close of Rs 194.45. This fall could have been guided by company reports that its net profit before extraordinary items fell 31.3 per cent to Rs 10.51 crore in the October-December period compared with a year ago. An extraordinary expense had depressed net profit to Rs 5.97 crore in the previous year.

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