Sensex recovers 175 points on short covering

MUMBAI: The Sensex on Monday staged a smart recovery of nearly 175 points to close at 10684.30 as investors covered positions unloaded in the previous two sessions.

After a weak start at 10461.73, the Bombay Stock Exchange 30 share sensitive index (Sensex) reversed the direction and gradually moved upwards to the intra-day high of 10704.78 before closing at 10684.30 against Friday's close of 10509.53, a net rise of 174.77 points or 1.66 per cent.

The Sensex had fallen by 410 points or 3.76 per cent in the last two sessions on selling triggered by a decision against disinvestment followed by rumours of resignation by Prime Minister Manmohan Singh.

On the National Stock Exchange, the S&P CNX Nifty firmed up by 66.15 points or 2.15 per cent to 3142.

Crediting the rally partly to an official dismissal of rumours on Mr. Singh's resignation, market players said operators as also foreign institutional investors were seen heavily covering short positions in the derivatives segment.

Market participants were believed to be heavy buyers in the futures segment on the back of shortcovering by FIIs.

Sentiment was also aided by a firm trend in Asian markets.

Leading the pack were IT stocks, which scored sharp gains on expectations of excellent first quarter results from IT majors such as Infosys Technologies, Satyam Computer and TCS.

IT bellwether Infosys is scheduled to kickstart the earnings season for the IT sector with its quarterly results on July 12, while Wipro and Satyam will announce their results later next week. PTI

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