Foreign funds lend buoy

STOCKS REPORT

The BSE benchmark Sensex closed at a 10-month high, buoyed by foreign fund inflows. The rally was led by gains in banks, cement, steel and energy stocks.

The Sensex closed up 26 points at 6,035.95 points, just above last Thursday's nine-month peak of 6,035.80.

So far this week, the index has gained 1.3 per cent. The broader Nifty index gained 11.45 points to end at 1,904.05.

On the BSE volumes were high with the BSE recording a turnover of Rs 1,890 crore. There were 1,447 gainers and 939 losers.

The weakness in the dollar was one of the reasons cited for the funds inflows into the country. Dealers said that this is expected to continue to sometime now.

Foreign funds have bought a net $800 million worth of shares in November so far, following net investments of more than $2 billion in the previous three months.

Foreign funds have invested nearly $6.5 billion so far in 2004, not far from their record single-year investment of $6.7 billion last year, drawn by expectations of strong growth in the economy.

Shares of banks went up due to expectations that higher interest rates would boost their income with loan disbursals going up. Hopes of consolidation in the sector is also boosting the stock, sources said.

Among bank stocks Corporation Bank rose 1.6 per cent, while Canara Bank moved up 1.8 per cent. HDFC rose 3 per cent.

Incidentally S A L Steel made its listing debut in the exchanges and closed at Rs 19.55 against its offer price of Rs 14 per share.

However in the booming market, Reliance stocks struck a jarring note, with speculation still rife on the family split. Reliance Industries and Reliance Energy both fell around 2.5 per cent. Together they make up almost 13 per cent of the BSE Sensex. Reliance Capital also went down 2.1 per cent.

ITC closed up 5.21 per cent to close at Rs 1,254.45 on sustained buying interest. Other index heavyweights which recorded gains were Hindustan Lever, which closed up 2.07 per cent to Rs 132.90, State Bank of India closed up 0.33 per cent to Rs 517.90, ICICI Bank ended up 0.31 per cent at Rs 326.40, while ONGC went up 0.86 per cent to Rs 810.15.

Among cement stocks ACC went up 1.09 per cent to Rs 287.60 and Gujarat Ambuja Cements closed up 1.11 per cent at Rs 367.75 with the companies raising cement prices in Mumbai.