Funds pull Sensex up 110 points

With metal and FMCG stocks leading the way, the Sensex on Friday bounced back by 110 points to finish just 50 points short of 11,000, ending a three-day slump.

Strong fund-based buying made sure the market opened strong at 10,852 points and made continuous gains throughout the day, negating the 100-point loss of the last three sessions.

The 50-stock Nifty at the National Stock Exchange ended at 3,279.80, up 1.01 per cent or 32.65 points after testing a high of 3,286.20 points during intra-day trade.

It also touched a low of 3,242.60, five points below its opening level. Led by foreign institutional investors and mutual funds, retail investors jumped on to the bandwagon later in the day, taking the Sensex close to the psychologically important 11,000-point mark for the second time in its lifetime.

Short-covering by derivative traders due to the impending expiry of the March contracts, too, added to the rise, according to market sources.

The sentiment was lifted by the overnight rally at the London Metal Exchange, which saw most of the metal stocks like SAIL, Sterlite, Tata Steel and Hindustan Zinc open strongly, despite the considerable upswing in yesterday's session.

The gains on Friday were concentrated in blue-chip stocks as institutional investors cashed in on lower valuations due to the three-day slide. Banking, pharmaceuticals and health care, capital goods and the information technology sectors were the key movers.

The BSE metal index went up by 3.51 per cent, largely due to gains in SAIL, Hindalco, Sterlite, JSW Steel and Hindustan Zinc. The FMCG index, too, ended up 2.29 per cent riding on the back of stocks like McDowell, ITC, Dabur and Tata Tea.

The third sectoral gainer was pharmaceuticals, with the BSE health care index closing 1.05 per cent up. Stocks like Matrix Laboratories, Cipla, Aurobindo Pharma and Ranbaxy outshone the rest in this sector.

The market was equally poised between gainers and losers while volumes were much lower than yesterday. In the NSE cash market, the turnover was Rs 7,762 crore, less than yesterday's Rs 8,885.64 crore, and on the BSE, Rs 4115.89 crore. The market breadth was neutral with exactly 1,271 advances and 1,271 declines, and 75 stocks ended the day with no change in their value.