Cautious optimism

STOCKS REPORT

Selective gains in banking and technology blue chips helped the 30-share Bombay Stock Exchange (BSE) Sensex end above the 6,000-mark on Thursday, after trading in the negative territory for most of the day.

The Sensex closed 8.89 points higher at 6,025.47, while the Nifty ended 3.40 points higher at 1,892.05.

The volumes on the bourses were fairly good, with shares worth Rs 1,998.77 crore being traded on the BSE on Thursday compared with Rs 1,781.19 crore on Wednesday. The market breadth was positive with 1,400 gainers and 990 losers.

Brokers said the mood in the market is cautiously optimistic with minor selling pressure at higher levels.

Motilal Oswal, chairman and managing director, Motilal Oswal Securities, said, "The markets are expected to sustain the above 6,000 levels as there is enough liquidity in the system. Also, there are no major triggers to dampen the sentiment."

Banking stocks gained further ground on continued buying. Public sector bank stocks such as Andhra Bank was up 8.82 per cent to Rs 64.80, Punjab National Bank up 7.17 per cent to Rs 305.05, Bank of Baroda up 6.01 per cent to Rs 186.15 and Oriental Bank of Commerce was up 5.60 per cent to Rs 273.60.

The index heavyweight State Bank of India was up 1.60 per cent to Rs 521.50.

Analysts said with many bank stocks trading at a much lower profit-to-earning ratio and with the sector not yet participated in the rally, investors are flocking into these stocks.

Further, hopes of consolidation in the sector with the government in favour of mergers has improved the sentiment.

Among private sector bank stocks, Centurion Bank was up 12.68 per cent to Rs 9.33, Bank of Punjab up 8.17 per cent to Rs 24.50. ICICI Bank ended 1.39 per cent lower at Rs 330.30 and HDFC Bank ended down 0.87 per cent to Rs 478.25 ended lower on profit booking after recent gains.

Tech stocks traded mostly higher. The BSE IT Sector index gained 23.57 points, or 0.93 per cent to end at 2,567.46.

Among pivotals, Satyam Computer was up 4.1 per cent to end at Rs 428.15, TCS up 2.2 per cent to close at Rs 1230.95 and Wipro ended nearly 1 per cent higher to close at Rs 721.45.

Infosys, however, ended lower on profit booking after a smart rally in the past few days. The stock was down 0.29 per cent at Rs 2,066.85.

Dr Reddy's Labs stocks was up 1.80 per cent to Rs 799.60, Ranbaxy Labs was 0.55 per cent to close at Rs 1,054.95, while Cipla slipped 1.53 per cent from Rs 274 to Rs 267.55.