The Hindu : Sharp rally in cyclicals takes Sensex to new high

Online edition of India's National Newspaper
Thursday, Jun 26, 2003

Business

Business

Sharp rally in cyclicals takes Sensex to new high

MUMBAI JUNE 25. Riding on a broadbased strong positive sentiment, disinvestment programme, good progress of monsoon and corporate performance, the benchmark index today closed past the 3,500-mark, up by more than two per cent, despite a two-day correction. The BSE-30 index spurted by 69.82 points to close at a new 15-month high of 3517.27 at the Bombay Stock Exchange on Wednesday.

Foreign funds and domestic institutions made heavy purchases in key scrips from various sectors like pharma, auto and those from old economy heavy weights.

For a change, IT sector stocks were not a major item on the shopping list of fund managers, dealers said. IT scrips are already overvalued and draw a limited interest, a fund manager with foreign owned mutual fund, said.

``Today's rally is indicative of strong investment interest due to better corporate performance, economic reforms including prospective initial public offerings of PSE stocks'', Motilal Oswal of Motilal Oswal Securities said.

Favourable monsoon conditions spread evenly over major parts of the country also gave the market the much needed boost for a sharp rally, dealers said. The sectoral BSE-PSE index also finished at an all-time high of 2298.26, up by 40.69 points on the back of upsurge in select public sector enterprises (PSEs) counters like HPCL, BPCL, EIL, HMT, ITI, MTNL, BEML and public sector banks such as BoB, Corporation Bank and OBC. There is substantial retail interest in the stock market and foreign funds have caught on the ``India story'' based on good corporate fundamentals, analysts said.

In the specified group, 153 including 26 index-based counters registered sharp to moderate gains while 40 others finished with losses. State Bank of India touched a new 9-year high, Grasim 3-1/2 year high and HPCL near its 6-year high during the trading session.

The volume of business was relatively up today at Rs. 1,235.45 crores from Rs. 1,048.35 crores yesterday with SBI topping the list of highest traded securities. — PTI

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