The Hindu Business Line : Wipro, Infy gain on FII buying

THE stocks of Infosys and Wipro gained on Monday when most of the top counters witnessed selling. Dealers said that several European FIIs were purchasing the stocks of these two companies.

The main factor for the interest is that many of the FIIs had gone underweight on IT sector and now they are increasing it. This is being done mainly to replace old economy stocks from their portfolio.

In addition, there is buying in these counters ahead of their stocks going ex-bonus. This is being done mainly by several high net worth individuals whose focus is on tax planning. Infosys gained 1.58 per cent to close at Rs 5,348.20 on the BSE while Wipro closed at Rs 1,568.55, up 3.66 per cent.

Core sector under pressure

AT a time when there is some revived interest in IT sector, stocks from old economy sectors like cement and steel are continuously remaining in sell mode.

Last week's increase in the prices of coal and petroleum products have further aggravated the market sentiment on these two sectors. If market talk is to be believed, several broking firms have started advising their clients to reduce their holdings in these two sectors.

With increase in the price of coal and petroleum products, the freeing rates and cost of production would go up. The talk is that cement companies are likely to be affected more as their cost of transportation is high.

Some of the stocks that are slowly being offloaded by market players include Tata Steel, SAIL, Essar Steel, Gujarat Ambuja, India Cement, Grasim and Madras Cement.

Aluminium cos back on buy list

SHARES of aluminium companies are back on the buy list of market players. Going by market talk, the international prices of aluminium are likely to remain firm through out this year.

Moreover, the domestic demand for aluminium is also good and this is attracting market players to these stocks. Initially, several market players had turned bearish on aluminium stocks in line with the fall in the price of most of the commodities.

But the view has changed in the last few days. On Monday, several market players bought shares of these two companies. Nalco gained 2.11 per cent to close at Rs 128.10 on the BSE while Hindalco closed at Rs 943.20, up 2.56 per cent.

Virendra Verma

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