Alagappan Arunachalam

CONCERNS on rising crude prices and falling Asian markets appear to have caused the negative sentiment that took control of the markets in the later part of the day.

The negative sentiment was subdued with a majority of the sector-oriented indices having shed value despite the advances-ratio favouring the gainers. The health care, auto, consumer durables and oil & gas indices were the saving graces of the day.

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The small cap index defied all odds to march its way northwards, recording 1.6 per cent gain. A few select stocks recorded sharp gains on the back of positive information.

The BSE Sensex, which opened almost flat, recorded gains in the early part of the day. However, with a majority of its constituents losing more than one per cent, the Sensex moved into negative territory. It closed for the day at 7,780.76 points recording a fall of 30.6 points.

The S&P CNX Nifty, which opened on a strong note, moved in the positive territory in the early hours but with the negative sentiment having set in, it appeared to have yielded pressure from the bears and lost the intra-day gains. The Nifty shed five points to close at 2,383.45.

Accompanied by a three-fold rise in volumes, Hinduja TMT recorded a gain of 2.85 per cent to close at Rs 338.9. Earlier in the day it announced its acquisition of a BPO outfit in Bangalore.

Announcements by Lupin that it had received approvals from the US FDA to sell its antibiotic used to treat respiratory and urinary tract infections prompted buying interest in the stock. Lupin gained Rs 34.6 to close at Rs 780.

Punjab Alkalies, which had been languishing in the Rs 70-80 band, skyrocketed to its 52-week high after the Punjab Government's announcement that the divestment process in the company would be complete by the end of September. Aided by a five-fold jump in volumes, the stock closed at the upper circuit of Rs 96.75, recording a gain of nearly 20 per cent.

Media reports of Mr Anil Ambani buying 14.9 per cent stake in Spanco Telesystems and announcements by the latter that it had bagged outsourcing orders worth Rs 5 crore created buying interest in the stock. About 15 lakh shares were traded on its counter compared to the two-week average of five lakh shares. Spanco, on the back of Thursday's gain of 19.6 per cent, recorded a 15 per cent gain.

Despite weak volumes on the L&T counter, the stock inched its way forward by 1.1 per cent after it announced that it had bagged an order worth Rs 450 crore for construction of a residential property in Dubai.

The Government announcement on merging Kochi Refineries with BPCL failed to create interest among investors; volumes remained almost flat on the Kochi Refineries' counter while there was a dip in volumes on the BPCL counter. The stocks, however, inched their way forward by 20 paise and Rs 1.4 respectively. The swap ratio has been determined at 4:9.

Media reports on Novartis AG of Switzerland being in discussions to acquire stake in Cipla prompted buying interest in the stock. The stock, which opened on a strong note, recorded high volatility as the stock moved back and forth within a band of 2.5 per cent. It closed for the day on a flat note.

Heavy buying activity took place on the counter of Geojit Financial Services, close to seven lakh shares changed hands. The stock closed with a smart gain of 9.5 per cent. Media reports of Geojit being in talks to buy UTI Securities appear to have caused the surge in investor interest.

Hindustan Construction, which announced that it had bagged two orders worth Rs 505 crore, recorded a two-fold jump in volumes. The stock closed with a gain of 5.92 per cent; it has been recoding gains over the last 21 trading sessions. The stock has gained 43 per cent over this period.

Significant gainers among the Nifty constituents were Ranbaxy, M&M, ONGC, Maruti, Sun Pharmaceuticals, and TCS.

Prominent losers on the Nifty were Dabur India, Bharti Tele-Ventures, ICICI Bank, VSNL, BHEL, and Tata Steel.

(This article was published in the Business Line print edition dated August 20, 2005)
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