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Rains hold stocks aloft

Mumbai, June 30: Strong buying support from foreign institutional investors (FIIs) and operators in heavyweights in the wake of a good monsoon propelled the BSE sensex past the 3600-level to a new 15-month high.

The positive close belied predictions made by many that the stock rally would lose steam in a long-overdue “correction”. Though there was a bout of profit booking in many stocks, Hindustan Lever and State Bank of India helped the market sustain its spell of gains.

The 30-share index opened higher at 3585.57, scaled its intra-day high at 3632.84 before closing at 3607.13 against Friday’s 3583.06 — up 24.07 points or 0.67 per cent.

Sources said Lever perked up on reports that rain gods have been benevolent so far. Good rains boost rural demand, the mainstay of companies like Lever. The stock climbed more than 2 per cent to Rs 178.45. SBI too rose by over 2 per cent to Rs 384.20 on the hope that it, too, would stand to benefit from a rejuvenated economy.

Drug firms and steel shares also performed well. While steel firms jumped on the speculation of a price hike, medicine makers like Cipla, Dr Reddy’s and Ranbaxy received a shot in the arm from heavy FII purchases.

Index circuits

The BSE announced index-based circuit breakers for the quarter July 1 to September 30, 2003. This follows a 2001 Sebi decision to introduce circuits breakers that will be activated at three stages of movement either way — at 10 per cent, 15 per cent and 20 per cent.

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