MUMBAI: Shares finished higher on Wednesday led by old-economy stocks such as
petrochemicals major Reliance Industries Ltd. as sentiment improved on slackened
selling by foreign funds, brokers said. Traders said the absence of alarming
developments so far in the stand-off between the United States and Afghanistan
also encouraged investors to hunt for bargains among battered bluechips.
"It is a confused market," said a head of research at a domestic
brokerage. "We are watching the situation in Afghanistan, and until there
is a real danger of war, investors could cautiously invest and earn good returns
in 12 months from now." Reliance Industries rebounded from its 18-month low
hit on Tuesday. The stock, which accounts for 12.23 per cent of the Bombay
index, rose almost 10 per cent to Rs 226.80.
The benchmark 30-share Bombay Stock Exchange index closed up 1.91 per cent at
2,667.34 points, off its day's high of 2,682.59. At Wednesday's close, the
bellwether index has lost 32.85 per cent since the start of the year. The market
breadth was slightly positive as gainers led losers 480 to 466. The traded
volume was 61.7 million shares, lower than 63.4 million on Tuesday but above
Monday's 51.06 million. The broader 50-share National Stock Exchange index
closed up 1.48 per cent at 874.15 points (provisional).
Technology stocks staged a late recovery on expectations of a firm start at
Wall Street after Nasdaq futures rose while trading in Europe. Infosys
Technologies rose 3.81 per cent, Satyam Computer climbed 3.22 per cent, while
Wipro Ltd. jumped more than 13 per cent. Foreign funds have been a key factor
driving domestic sentiment in recent days. Data from the Securities and Exchange
Board of India showed that after the September 11 attacks, offshore funds have
been net sellers of Indian shares in seven of the 10 trading days so far.
Latest data showed they have been net sellers of Indian shares worth $74.1
million so far this month. And with just a few days to go in September, analysts
expect offshore funds will close this month as net sellers for the first time in
2001.