The Hindu Business Line : Sensex swings in volatile trade, gains 118 points at close

INSTITUTIONAL investors bought key index stocks in the afternoon trading session today and helped the BSE Sensex end a volatile day with a 118-point gain over its previous close.

In extremely choppy trade, the benchmark 30-share index moved in a range of 206 points. After falling 75 points, the Sensex recovered to end with a gain of 117.91 points (1.98 per cent) at 6,064.10, snapping its two-day losing streak. The NSE S&P CNX Nifty index also ended with a gain of 34.70 points (1.83 per cent) at 1,935.35.

Brokers said stock prices rose mainly on the back of strong buying in index (Sensex and Nifty) by some FIIs. In addition, buying gained momentum in the final hour on account of short covering.

A news report that South Korea's largest steel manufacturer Posco has hiked steel prices by 11-14 per cent effective next month brought increased interest into steel stocks, especially for Tata Steel. The Tata group company's stock gained nearly five per cent to close at Rs 457.20.

Buying in the country's largest bank SBI also aided the bullish sentiment. The stock closed at Rs 659.60, up 3.80 per cent. Other major gainer (outside the Sensex or Nifty) is Maruti, up 5.55 per cent at Rs 422.50, on reports that the company has been included in the Nifty index.

Officials at top broking firms said the overall mood is still mixed in the market due to increased volatility. They said the rise in prices in today's trading was on low volumes indicating that there is no active buying.

Even the advance-decline ratio on the BSE was in favour of bears; of the 2,154 shares traded, 875 advanced, 1,204 declined and 76 remained unchanged.

There has also been concern over the slowdown in the FIIs' inflows in the last few days. FIIs turned sellers in the last two trading sessions, when the stock market had seen a sharp fall. "If FII inflows slow down or are negative in the next few sessions, further fall in stock prices is possible," said an official of a broking firm that has several FII clients.

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