The Hindu Business Line : Gains on active interest

IN yet another volatile trading day, the Infosys Technologies stock saw heavy volatility. However, at close the stock gained mainly on back of active buying from institutional investors.

According to market talk, several funds sold heavily in the morning in line with the overall fall in IT stocks. However, the buying by several London-based FIIs in afternoon lifted the stock price.

Dealers said that there has also been increased buying in the stocks as the outlook for the sector and company looks very positive in the next few quarters.

Sources said that Infosys would be very aggressive on the acquisition front this year; this is also leading to some buying in the counter from informed buyers.

The stock gained 1.72 per cent to close at Rs 5,461.95 on the BSE with volume of 3.45 lakh shares. On the NSE it closed at Rs 5,439.45, up 1.48 per cent with volume of 6.15 lakh shares.

Hedge fund on selling spree

THE heavy volatility in the stock market on Thursday was attributed to heavy selling by some hedge funds. Dealers said that a leading foreign broking firm sold index (Sensex and Nifty) valued around Rs 100 crore for hedge funds.

The selling by the hedge funds was between 2 p.m. and 2.30 p.m. This was the main factor for the sharp fall in the stock indices in the afternoon. The talk is that several hedge funds which had invested in India through participatory notes (PNs) have started selling part of their holdings.

Dealers said that the maturity of PNs is usually around 90-180 days. The recent SEBI clarification on PNs is also leading to selling. The talk is that selling by these hedge funds to continued in the next few weeks.

New FIIs bullish

AT a time when there is concern in the market over selling by hedge funds, the talk is that several new FIIs have shown interest in the market and with every dip in the market they have been buyers.

Two leading foreign broking firms are slated to hold their annual meets in India shortly for FII clients. Dealers said after the annual meet, where several listed corporates would be meeting the FIIs, the inflows into Indian markets are likely to increase. Some of the FIIs, that are already present in the market, have also increased their allocation to India in 2004.

Virendra Verma

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