The Hindu Business Line : Sensex rises 206 pts on Diwali-eve — Thin volumes indicate low investor participation

However, volumes on BSE and NSE were quite low indicating poor investor participation. The upturn in most of the Asian markets also boosted market sentiment. Selling pressure seems to have eased out and the markets appear to be consolidating at current levels, brokers said. They said corporate earnings would continue to dominate sentiment and lead to short-term volatility.

Stock prices opened firm in the morning, and as the day progressed they bounced up further. Dealers said the initial rise in the stock prices was due to sharp fall in stock prices in the last few days and an upturn in most of the Asian markets.

However, after the BSE Sensex made a gain of over 100 points, some short-sellers turned active and started selling at these levels anticipating that the rise would not be sustained. But, the selling pressure failed to dampen sentiment, prompting short-sellers to cover their position. This drove shares up further in the last 30 minutes of trading. At close, BSE Sensex recorded a gain of 206.68 points (2.69 per cent) at 7,892.32 and NSE's Nifty closed at 2,370.95, up 54.9 points (2.37 per cent).

But trading volumes were much lower compared to previous trading sessions. The total turnover on BSE was Rs 2,115.51 crore compared to average trading turnover of Rs 2,955 crore, and, on NSE, the turnover was Rs 4,625 crore compared to Rs 5,181 crore on Friday. In the derivatives segment also, the turnover was low.

Brokers said low turnover was due to lack of investors' participation. "There are just two full trading sessions this week; therefore, nobody is keen to trade," said a dealer with a domestic broking firm.

He said that Monday's rise in the stock prices could not be considered as if the market has bottomed out. "Prices have increased along with low volume which is not a good sign," he added. Among the major gainers in today's trading were Titan Industries, India Cement and Suzlon Energy.

Muhurat trading: BSE and NSE will hold a special 75-minute Muhurat trading on Diwali day. The trading will begin at 6.05 p.m. and close at 7.20 p.m.

Meanwhile, there will not be any trading on Thursday and Friday on BSE and NSE on account of Bhaubeej and Ramzan holidays, respectively.

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Sensex rises 206 pts on Diwali-eve — Thin volumes indicate low investor participation