Politics Plays The Devil Again

For the nth time, political developments played havoc with sentiment. However, with both the United States and Asian markets in a bad state at the moment, players seem to bank on the hope that FIIs may not decide to withdraw money from the Indian markets. Reason: they have no alternative markets for investments at present.

The Dr Reddy's Laboratories share is witnessing sustained buying interest from foreign funds despite weakening sentiment. On Wednesday, a foreign fund is reported to have bought around 40,000 shares. Yesterday, too, there was good amount of institutional buying interest at the counter which sent the scrip soaring to new 52-week highs during intra-day trading.

Pharmaceutical shares were the flavour of the day yesterday with funds reported to have made purchases at the Wockhardt, Cipla and E Merck Counters.

Flashback

On Wednesday a leading domestic fund is reported to have picked up around 4 lakh shares of the Telco, which resulted in trading being frozen at the counter. Key index scrips witnessed good amount of buying and selling interest on Wednesday.

A UK-based fund is reported to have sold around 80,000 shares of Reliance, while a local brokerage with a US tie-up is reported to have sold close to 4 lakh shares. A domestic brokerage is reported to have picked up around 5 lakh shares though it could not be confirmed whether the purchase was on behalf of a local or a foreign fund.

The MTNL scrip also changed hands actively with two foreign funds reported to have purchased around 4.75 lakh shares between them. Against these purchases, a US-based brokerage is reported to have sold a little over 4.5 lakh shares of MTNL.

Ranbaxy seems to have lost favour with a couple of foreign funds, which sold around 45,000 shares between them. Other scrips on the selling list included Hindalco and SBI. While 31,000 shares of the Hindalco were sold. close to 2.5 lakh shares of the SBI were dumped by another fund.

Disappointing results from Colgate seems to have prompted a foreign to sell around 1 lakh shares of the scrip on Wednesday. On the buying side, a fund is reported to have purchased around 12,000 shares of Infosys Technologies.

The mutual fund of a leading bank is reported to making aggressive purchases over the past few trading sessions. It is reported to have picked up around 1 lakh shares of ITC and almost a similar quantity of Satyam Computers.

The operator at the ITC counter seems to be finding it difficult to support the stock. Despite institutional buying, the scrip yesterday breached the Rs 600 levels. A scrip which was once tipped to cross the Rs 600 levels by players is now languishing below Rs 150 in the absence of any buying interest. Worse, it touched a new 52-week low on Wednesday following a large sell order of 2.75 lakh shares at the counter by a foreign institutional investor. Surprisingly, the counter remained steady yesterday though the general trend was weak.

Tailpiece

Are the bourses heading for a crash?. Seems unlikely if one were to look at the long short positions released by the BSE. Despite the market going down by 36 points, the short positions have actually gone down. This is surprising simply because even after things looking bleak all around, the bear operators have covered their short positions instead of creating fresh ones. The short position at the end of Wednesday stood at Rs 269 crore which came down to Rs 250 crore.

On the other hand, the long position has also dipped marginally to Rs 690 crore yesterday from its Wednesday's level of Rs 695 crore. This could be another ploy adopted by the operators.