Buoyancy Continues On Bull Frenzy, Fii Buying

The Bombay Stock Exchange Sensex began from where it left off on Tuesday to cross the 3,300-mark, registering a gain of 114.73 points over the previous close of 3227.13 to finish the day at 3341.86.

However, marketmen say that bulls have taken a speculative position and that neither the foreign institutional investors nor the domestic institutions were aggressive buyers yesterday in the market.

The Sensex resumed at 3233.71, compared to 3227.13 and touched a high of 3344.35. The index has risen by over 200 points in two sessions and this means the overall market capitalisation for 30 shares has gone up about 6.3 per cent.

 

The market has not shown a rise of such magnitude in a short period of two trading days in recent months.

The scenario has undergone a sea change with bulls playing a key role in the current rally. Leading speculators of major centres have resumed buying operations and were building up positions in prominent scrips on hopes of a further rise in prices. The foreign investors have also become active buyers but their purchases were confined to low priced growth potential shares.

The RBIs credit policy has brought some confidence in the market but the current rally is mainly due to technical considerations as the market had experienced a long bear-phase.

However, many feel that the rally is short-lived and is not expected to sustain for long. Says a source at a leading institutional brokerage: The market will witness a barrier at around 3400-levels and then it is expected that they will hover around the 3200-levels. The FIs as well as FIIs are adopting a wait and watch policy. There is also a redemption pressure on these institutions.

All pivotals registered smart gains. The SBI stock continued to hog the limelight. It opened at Rs 230.50, touched an intra-day high of Rs 240.25 and finished at Rs 230, gaining Rs 11.25 over the previous close.

Reliance gained Rs 8, while ACC registered a smart recovery, gaining Rs 94.25 points.Arvind Mills gained Rs 8.50, while MTNL gained Rs 10.