The Hindu Business Line : Infosys scrip braves brokers' boycott

UNCERTAINTY regarding issues such as turnover tax and the increase in FDI in the telecom and insurance sectors continues to prevail over the market. The markets, which had a dull day on Monday, ended Tuesday on a negative note.

Brokers, day traders and arbitrageurs abstained from the market on Tuesday in a protest against the proposal on transactions tax. This ensured that the volumes in the market remained low, as was the case on Monday.

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The BSE Sensex declined by 45 points to close at 4899 points, down from its previous closing of 4944 points while the Nifty, ended the trading session lower by 17 points, to close at 1539.30 points.

The Sensex began the day on a strong note at 4961.87 points. The benchmark index remained strong during the earlier hours of the session, buoyed by buying activity in index heavyweight Infosys, which had just announced its results.

However, the gains could not be sustained, and the Sensex plunged into the negative territory. Only six stocks out of the 30-strong benchmark index advanced, reflecting the negative moods in the markets.

Outside of the Sensex, the BSE PSU Index was the worst affected, declining 1.18 per cent. The stocks of ONGC, SAIL, BPCL, Container Corporation were the major losers among the PSU stocks. However some of the public sector banking stocks such as IOB, PNB, Oriental Bank and Vijaya Bank traded firm.

There was selling pressure across the index heavyweights with the exception of Infosys, which gained 1.90 per cent. The stock gained following the announcement of its result for the first quarter of the fiscal. The company had posted a 40 per cent rise in net profits for the quarter. The results appeared to have triggered of buying activity in other IT stocks as well.

The BSETECk index was the only index on the BSE to remain in the positive, although the appreciation was only marginal at 0.77 per cent. Stocks that gained include Satyam, Patni Computers, Hexaware and Polaris to name a few. The stock of Patni gained 5.54 per cent.

Uncertainty regarding the monsoon resulted in cement and fertiliser stocks taking a beating. The stocks of ACC, Gujarat Ambuja, Rashtriya Chemical Fertiliser, Madras Fertilizers and Nagarjuna Fertiliser are some of the stocks that declined.

Stocks of the auto sector, Tata Motors, Maruti, Hero Honda to name a few, also slumped, which could be, in part, attributed to the uncertainty in monsoon.

The stock of Grasim tanked by Rs 53.2 to close at Rs 959.2. Selling pressure drove the stock down following the decision of the company's Staple Fibre Division to curtail production by about 80 tonnes per day owing to the uncertainty in the monsoons. Some stocks managed to gain on the back of positive news. The stock of Bajaj Hindusthan gained marginally by Re 1 to close at Rs 45.55 on the back of its proposal to raise Rs 100 crore through sale of shares for the purpose of expanding capacity.

The stock of Praj Industries gained Rs 2.55 to close at Rs 131.35. This gain comes on the back of the company's recommendation of a final dividend of Rs 2.25 per share for financial year 2003-2004.

The stock of Sakthi Sugars gained Rs 1.2 to close at Rs 29.9 on the back of its allotment of 18,00,000 equity shares of Rs. 10/ each at a premium of Rs 40 per share to Global Small Cap fund on preferential basis.

The stock of Indian Overseas Bank gained marginally following news of its proposal to issue unsecure, subordinate and redeemable bonds in the nature of promissory notes aggregating to Rs 200 crore by way of private placement basis