The Telegraph
Since 1st March, 1999
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Petro selloff hopes drive sensex to new high

Mumbai, Dec. 2: A Prime Ministerial reassurance that selloff in oil companies was still on the table ignited a rally in public sector companies, helping the sensex race to a four-and-a-half month high at 3270.36 points.

Atal Bihari Vajpayee said the government is considering divesting its shares in HPCL and BPCL, bringing cheer to a market that had almost written off the PSU story.

The 30-share index opened strong at 3247.60, declined to a low of 3238.89 but bounced back on brisk buying to 3277.37 before ending at 3270.36 ó up 41.54 points or 1.29 per cent. This is the highest close since July 15.

Market watchers said operators and institutional investors made heavy purchases in PSU and technology shares. The mood was lifted by Sebiís decision last week to expand the list of shares for derivative trading, and giving exchanges more freedom on what to choose.

HPCL, BPCL and Nalco were among the state-owned companies that carried the day on Dalal Street; Nalco zoomed over 10 per cent at Rs 90.25, HPCL surged Rs 10.75 or 5 per cent to end at Rs 230.75, while BPCL finished 5 per cent higher at Rs 200.40.

Analysts attributed the buying in the oil companies to expectations that they would figure at the meeting of the Cabinet Committee on Disinvestment over the weekend.

The Nalco stock firmed up in the wake of reports that Rus-Al, the Russian aluminium major, is one of the contenders in race the governmentís stake. A V Birla groupís Hindalco Industries is another big aspirant. Investors also take a shine to front-line technology majors like Infosys, Satyam Computer and Wipro. Second-rung software counters were in the thick of action too, finishing with sharp gains on the back of speculative buying.

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