Sensex jumps by 3.2% during the week

The sensex flared up by 3.2% to a two-month high of 6707.72, extending its gaining streak for the fourth consecutive week on the back of sustained purchases by domestic funds and fresh buying support from operators despite negative FII activity.

In the week upto May 28, the BSE Benchmark 30-share Index fluctuated widely between 6772.74 and 6499.21 before ending the week at 6707.72 against the last weekend's close of 6499.50, a net rise of 208.22 points.

Indian Financial Institutions, which have become the sole driving force behind the market since the beginning of May, reported net purchases of Rs 765.06 crore in the first four trading sessions of the week, taking the total net investments by local funds to Rs 3389 crore so far in the month.

FIIs, however, remained net sellers. They reported net sales of Rs 294.40 crore in the week's first four days.

The market was bolstered by a positive statement by Finance Minister P Chidambaram on the country's economic growth and downtrend in the inflation number.

Reports that the government will hike prices of natural gas prompted a smart rally in ONGC, which concluded the week up by 6.25%.

Chidambaram projected the government borrowings for 2005-06 less than the estimates and expressed its intention to ensure that inflation is kept under control and the interest rates are benign to achieve about seven per cent growth.

Inflation fell to 5.55% for the week ended May 14 from the previous week's level of 5.61%.