Infosys recovers as sensex spurts 110 pts in volatile trade

Infosys Technologies which was influenced by the overnight sharp rise in the company’s ADR at the Nasdaq stock exchange attracted fresh spell of buying support at prevailing lower levels and hit the upper end of the circuit-filter. SSI Ltd after remaining locked in the lower end of price band for several sessions, rebounded to recover part of its lost ground.

Sensex (BSE sensitive index) which was pushed sharply down to the day’s low at 4608.11 at around mid-session recovered to finish at 4866.73 with a handsome gain of 109.67 points or 2.31 per cent compared to the yesterday’s close of 4757.06. The BSE-100 index too shot up by 45.70 points to 2683.77 from previous close of 2638.07. The Nifty index of the NSE gained 17.70 points to 1452.65 from 1434.95.

In the specified group, Digital Equipment and Ballarpur were locked in the upper circuit filter while HDFC Bank, Titan Ind, Dabur India and McDowell hit the lower price band. “Several technology shares which were 8 per cent down in the morning session recovered by afternoon. It seems the worst is over,” said a broker.

Satyam Computer was the most active scrip with a turnover of Rs 435.87 crore of the total volume of business of Rs 2,931.39 crore on the BSE. However, the scrip dipped by Rs 98.65 to Rs 3,350. HFCL was down by Rs 46.30 at Rs 1,272, GACL by Rs 5 at Rs 205, ITC by Rs 23 at Rs 678, MTNL by Rs 3.30 at Rs 215.90, NIIT by Rs 122.15 at Rs 1,475, TELCO by Rs 3.95 at Rs 127.95 and TISCO by Rs 2.45 at Rs 114.50.

“There is some support from a few local and foreign funds," said a dealer with a local brokerage. A seven per cent plunge on Tuesday mirroring the Nasdaq’s losses and fears of tax claims on Mauritius-based foreign funds has hurt the market sentiment and most of the speculators are using every rise to cut positions.

"The `new economy’ is still there," said an investment strategist at CEF Securities. "But we have to separate the good stocks from the bad in the high-tech sector." The market’s love affair with infotech’s initial public offerings is likely to cool for a while, with listing hotbeds like Hong Kong likely to see the biggest shake-outs, analysts said. A 13 per cent intra-day plunge in the Nasdaq earlier this week and a 17 per cent drop as of Wednesday since its high in March have taken the shine off Internet and "new economy" stocks.