Sensex bounces back by 168 points

MUMBAI, FEB 24: Stock markets rebounded from Wednesday's losses to end higher on Thursday as speculators pushed rumours out of their minds...

MUMBAI, FEB 24: Stock markets rebounded from Wednesday8217;s losses to end higher on Thursday as speculators pushed rumours out of their minds to tuck into key index stocks. Shrugging off the hangover from previous day8217;s crash, Sensex bounced back by 168 points as funds and speculators picked up stocks at low levels minutes before the closing.

The index had ended 4.09 per cent weaker on Wednesday on rumours that Indian regulatory authorities were planning a crackdown on speculators. On Thursday, the market shrugged off such concerns to end strongly after both the Securities Exchange Board of India SEBI and Reserve Bank of India RBI clarified that they had no such intentions. The recovery was led by Hindustan Lever and Infosys.

Sensex BSE sensitive index opened sharply up at 5764.16, gradually moved upwards to the day8217;s high of 5816.16 and dipped to 5620.83 before closing at 5810.17 with a sizeable gain of 167.71 points compared to yesterday8217;s close of 5642.46. The BSE-100 index edged up by 4.90 points to 3588.17 from the previous close of 3583.27.

8220;The market was going rudderless till the last half-an-hour. Speculators and funds aggressivly picked up index-based shares. As a result, Sensex soared in the last 10 minutes. Speculators are going too far. Investors should be careful while buying shares,8221; said a fund manager.

The rally was led by consumer goods firm Hindustan Lever Ltd which closed at an all-time record high at both the exchanges. Hindustan Lever ended at Rs 3,099.55, up eight per cent at the BSE. On the NSE, it ended 7.10 per cent higher at Rs 3,106. Operators said funds continued to find Lever attractive after the firm announced a stock split and 32 per cent profit growth for 1999 on Wednesday.

Tech stocks were mixed with Infosys Technologies closing 3.3 per cent higher at Rs 9,494.50 and NIIT closing 2.23 per cent lower. Diversified firm Wipro ended eight per cent down at Rs 7,494.15 for the third day in a row. Others like Rolta, Silverline, Pentasoft and BFL Software also closed lower.

The broad market continued to be mixed with decliners just beating advancers 928 to 912. Dealers said heavy fund buying in key index stocks had buoyed the market despite consistent selling by speculators. The net long positions at the Mumbai exchange fell to Rs 4,413 crore on Wednesday from Rs 4,931 crore on Tuesday. Dealers expect the figure to fall further on Thursday.

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Power firm BSES ended 3.52 per cent higher at Rs 284.50 on newspaper reports that it has decided to acquire an E-commerce portal. Shares of consumer firm Cadbury India Ltd rose eight per cent to Rs 816.40 after the firm announced it is considering a bonus issue in the ratio of one share for every two shares. The firm also reported a higher net profit of Rs 367 million for 1999.