Overseas winds help Sensex to soar 84 pts

With local pressure points such as the Budget and the transaction tax out of the way, and the monsoon reviving, the Indian equity market is closely following the lead of the international markets.

If yesterday's 25-point fall in the Sensex was led by technology stocks following the selloff in the sector all across Asia, today's gains were driven by overseas winds.

Technology scrips were among the biggest gainers on the bourses today, albeit in thin volumes. The Bombay Stock Exchange (BSE) Sensex surged 1.62 per cent (83.71 points) to close at 5,252.78, a three-month high.

Today's rise is line with gains reported in most other Asian indices, which closed higher on the back of relief buying in technology stocks. Sentiment across Asia was also boosted after the OPEC said it had enough reserves to pump out to cool crude oil prices. The statement eased the pressure on crude oil prices.

Blue chips were in the limelight, with 27 of the 30 scrips in the Sensex basket closing higher and gainers outpaced losers 13:5 on the BSE. Among sectoral indices, the BSE IT index was the biggest gainer, closing 2.68 per cent higher.

The Wipro scrip was the biggest gainer in the Sensex basket, up 6.23 per cent to Rs 564.45, Satyam Computer gained 2.81 per cent to Rs 349.35 and Infosys Technologies was up 0.47 per cent to Rs 1,556.95.

The BSE Bankex was up 2.47 per cent and the capital goods index rose 1.82 per cent today. Automobile scrips reported gains after witnessing profit taking in the last few sessions. Hero Honda Motors was up 4.01 per cent to Rs 447.65 and Tata Motors gained 2.35 per cent to Rs 435.85. Among heavyweights, the Hindustan Lever scrip gained 3.36 per cent to Rs 116.80.

The only losers in the Sensex basket were Zee Telefilms, down 0.82 per cent to Rs 139.45, Ranbaxy Labs, which fell 0.37 per cent to Rs 929.65 and Bharti Tele-Ventures, which lost 0.23 per cent to Rs 150.30.

Market sources said that lower global oil prices and hopes that the rate of inflation will not rise further helped sentiment today. Technology scrips were also buoyant on the excellent response to the Tata Consultancy Services IPO.

Deepak Chabbria, chief operating officer, institutional equity, at IL&FS Investmart, said, "The markets look positive but rangebound. Institutional buying after two days of losses helped the market rise."

He added that short covering in the derivatives market also helped fuel the rally which led to the August series Nifty futures contract closing at a premium to the spot Nifty.

Brokers said this trend is positive for the market in the medium term. The National Stock Exchange (NSE) Nifty was up 28.40 points to close at 1654.95 while the August series futures Nifty closed at 1656.80.

Cash segment volumes were marginally higher than on Wednesday, with the BSE reporting a turnover of Rs 1858.33 crore and the National Stock Exchange (NSE) reporting a turnover of Rs 4439.65 crore.