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Friday, Feb 15, 2002

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PSU stocks continue to be red hot

Suresh Krishnamurthy

ON Thursday, the uptrend in stock prices continued with the Sensex at the BSE closing at a level close to its day's high.

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The Bombay Stock Exchange (BSE) Sensex opened the day on a confident note but thereafter meandered in a close range. A surge in prices in the closing session saw its value vault to the day's high of 3,564. The Sensex ended the day at 3,557 gaining a shade more than 1 per cent over the Wednesday's close. Similar trading patterns were in evidence at NSE with Nifty closing at 1,150 gaining 1.31 per cent. Broader indices such as BSE 200 and BSE 500 gained more than 2 per cent. Interestingly, S&P CNX 500 under performed these two indices and settled with a 1.5 per cent gain.

The surge in prices, however, was not accompanied by any surge in trading volumes. Turnover in both these exchanges registered declines. At the BSE, turnover dipped to Rs 1,261.90 crore from Rs 1,353.3 crore and at the NSE to Rs 2,138.4 crore from Rs 2,421.8 crore. The advance-decline ratio, at both the NSE and the BSE, was in favour of advances - 439 stocks advanced while 284 declined at the NSE while 783 advanced and 595 declined at the BSE.

At the BSE, advancing shares accounted for 89 per cent of the day's turnover - up from 68 per cent on Wednesday. The BSE 100 index accounted for close to 80 per cent of the day's volumes.

Foreign institutional investments also registered a rise on Wednesday and this may have propped up sentiment on Thursday.

The BSE Capital Goods Index and BSE PSU Index recorded significant gains during the day. In the capital goods sector, apart from PSU stocks, stocks such as Elgi Equipment, SKF Bearing, KEC International, Widia India and KSB Pumps recorded gains of more than 6 per cent. In the case of PSU stocks, star performers were Bharat Earth Movers, Neyveli Lignite, Hindustan Organic, ITI and Rashtriya Chemicals. These stocks gained close to 20 per cent. Stocks such as Engineers India, Dredging Corporation, ONGC Corporation and Shipping Corporation also recorded significant gains of more than 10 per cent.

Some of the Government-owned banks and FIs were also in trading limelight. Stocks of Dena Bank, IDBI, Bank of India, Bank of Baroda and ICICI recorded gains. State bank of India, which gained 3 per cent also figured in the top traded list. ICICI Bank, which is to be merged with ICICI, also ruled firm.

The stock of Investment Trust of India, which is one of the promoters of Pioneer ITI Mutual Fund, also gained during the day. Other gainers included HCL Infosys, Procter & Gamble, Siemens and Titan Industries.

Major losers during the day were from the consumer goods and the healthcare sector. Stocks such as VST Industries, Godfrey Phillips, Godrej Foods and Morepen Labs shed more than 3 per cent.

The downtrend in VST Industries and Godfrey Phillips needs to be seen in light of the reports of 9 per cent decline in cigarette volumes during the first nine months of the financial year.

The stock of ETC Networks, whose counter has been witnessing robust trading volumes in recent trading sessions, lost 6 per cent during the day. The stock of Mid-day Multimedia and Ashima also lost more than 6 per cent. The day also saw the rally in the stock price of Cummins India and Corporation Bank curtailed.

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