FMCG, IT provide succour

STOCKS REPORT

Recovery in mid-caps and renewed buying interest in select FMCG and frontline IT stocks pushed the markets in the positive territory after a sharp correction on Monday.

Brokers said, the markets are expected to exhibit volatility as it lacks fresh impetus for an upside. After a sharp correction, there was a bounce back on buying support in select frontline stocks. However, the markets are expected to trade sideways for the next couple of days, said a leading NSE broker.

The Bombay Stock Exchange (BSE) Sensex hit an intra-day high of 6722.55, before closing 51.56 points or 0.77 per cent higher to close at 6715.11. The Nifty ended 15.15 points higher to close at 2087.55.

A equity dealer with a domestic broking firm said, "Tuesday's recovery was more of a pull back after a sharp correction. There are signs of a slowdown in FIIs inflow across Asia including India and monsoon will prove to be the next big trigger for the markets."

A fund manager with a domestic mutual fund said, "The focus has entirely shifted to mid-cap segment and the broader index may just underperform in the short term."

The BSE Small-Cap index was the biggest gainer in Tuesday's trading as many of these stocks recovered after a correction in the past few days. Torrent Cables jumped 10 per cent to Rs 220, KEC International was up 8 per cent to Rs 219.60, and Alstom Projects was up 8 per cent to Rs 242.25.

The breadth of the market, however, was negative with 770 advance as against 837 declines. The volumes were moderate and accounted for Rs 1,753.37 crore on BSE and Rs 3,968.91 crore on the National Stock Exchange (NSE).

BSE IT and BSE FMCG indices were the other two big gainers in Tuesday's trading, while investors sold capital goods stocks with the BSE Capital Goods index losing 0.34 per cent to close at 3595.81.