Sensex leaps 352 pts

Software stocks, which were battered in the last one week, led the charge — Infosys Technologies again at the fore — with most hitting the eight per cent limit-up locker within minutes of the market’s open. Over 100 software scrips in the cash section were locked in the upper circuit filter. The sentiment was also aided by the sharp gains in American Depositary Receipts of Indian firms on the Nasdaq exchange on Thursday.

Sensex (BSE sensitive index) opened with a wide upside gap at 4987.10 and flared up further to the intra-day high of 5222.80 before closing at 5219.20 with a sizable gain of 352.47 points or 7.24 per cent compared to the yesterday’s close of 4866.73. The BSE-100 Index soared by 195.95 points to 2879.72 from previous close of 2683.77. The Nifty on National Stock Exchange closed 7.18 per cent or 104.20 points up at 1,557.15.

Dealers said the market could continue to rise next week as earnings numbers of key infotech stocks start rolling in. Data from the BSE showed 1,245 issues advanced, 383 declined and 118 were unchanged. After falling over 360 points on Tuesday, the second largest points drop ever, the index had bounced back over 520 points.

“Today’s rally is more broad-based. But it is too early to say it will last, we need two more upward moves of this nature to decide finally," said a dealer. Infosys Technologies rose to Rs 9,110, NIIT to Rs 1,592.95, Satyam Computer Services to Rs 3,617.95 and Wipro to Rs 5,312.90 on brisk buying by foreign funds. Fifteen index-linked stocks were also frozen at the upper eight per cent limit. This included ACC at Rs 167.10, Gujarat Ambuja Cements at Rs 221.35, BSES at Rs 237.55, Grasim Industries at Rs 359.70, HPCL at Rs 135.80, ICICI Rs 137.30 and MTNL at Rs 233.15, Reliance Industries at Rs 351 and Ranbaxy at Rs 692.50.

Marketmen said the return of buoyancy on the market was also due to market regulator SEBI’s decision to relax margin rules, asking stock exchanges to refund surplus daily cash margins deposited by brokers.

While the tax demands made on a handful of investors channelling their trade through Mauritius caused some to stop taking subscriptions on Thursday, foreign investors have been active bargain hunters throughout the past few days. Daily figures from the Securities and Exchange Board of India (SEBI) showed foreign investors net buyers of $24 million on Tuesday — the day the market crashed by seven per cent.

The government on Thursday night finally acted to end the uncertainty over the tax status of a few of the 150 foreign investors using Mauritius as their gateway to India. It said there would be "no further action" on the tax demands issued to five firms and past tax liability cases would not be re-opened, and clarified that capital gains earned in Mauritius would not be taxable in India.