Ice Volumes On Bse, Nse At A Record High

Trading volumes on the stock exchanges have been dominated to the extent of 85 per cent by the information technology, communication and entertainment stocks even as ICE stocks prices have plummeted by 50-60 per cent in last six months. This means the hefty decline in the market value of ICE stocks has not daunted traders and speculators from hanging around the ICE stocks. The turnover volumes in ICE stocks soared to a record high during the 13-days' trading of the current month. The combined volume of ICE Stocks accounts for 84.36 per cent of the total volume on the Bombay Stock Exchange and National Stock Exchange. The ICE dominance on the exchanges is so much that, the old economy stocks which account for the 60 per cent of the total market capitalisation on BSE and 90 per cent of private sector net profits, account for a meagre 15 per cent of the trading volume on exchanges Volumes in ICE stocks during the current month have perked up on two counts. Foreign Institutional Investors who were net sellers in the months of June and July 2000, turned net buyers to the tune of over Rs 1,000 crore in the first fortnight of August 2000. The depreciation of rupee by almost three per cent also played a major role in pushing up the attractiveness of ICE stocks. In April 2000, the world wide tumble in tech stocks saw ICE volumes as a percentage of the total turnover drop to a low of 60 per cent from 80.2 per cent in March 2000. The ICE turnover began to look up in May after the major clean up of ICE stocks in April 2000. In May, however, ICE volumes rose to 78 per cent of the total volume and in June it increased to 82.4 per cent of the total volume. The volume drop in July to 79 per cent on selling pressure from FIIs and local Fund. Petrochemical sector, which has been dominated by Reliance Industries account for 2.26 per cent of the total volume""a sharp drop compared to the volume of 17 per cent to the total registered in April, 2000. The fast moving consumer goods (FMCG) sector, dominated by Hindustan Lever accounts measly one per cent of the total volume. Refineries, steel, pharmaceuticals, banks and automobile which dominated the trading volume few years ago are lagging far behind. The trading volume of these sectors account for less than one per cent each.