The Telegraph
Since 1st March, 1999
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Sensex races past 4000-mark

Mumbai, Aug. 19: The sensex clambered atop the 4,000-mark 29 months after it was knocked off the peak in a March mayhem that triggered a searing stock meltdown.

Bombay Stock Exchange’s (BSE) gauge of market vitality leapt across the magic mark around 10 this morning, barely a few minutes after trading began for the day.

Leading it up the heights were old-economy war-horses like Hindustan Lever, Reliance Industries, ACC, Grasim and HDFC. The Lever share sizzled on the back of hopes that the good monsoon will shower purchasing power in the heartland, where most of its customers live off farms.

The wads of cash that went into those shares came from foreign institutional investors (FIIs), which pumped more than Rs 550 crore last week, and $ 1.6 billion since May. This tally is more than two times the $740 million they invested in 2002. Local institutions, however, continued to sell at every available opportunity on the high to rake in the profits.

Will the rally continue apace' While few in the markets think it will not, most share the notion that the climb from this point will be punctuated with pauses.

Says Ramesh Damani, a BSE broker: “After a stunning three-month rally, the market will pause for breath before climbing to still newer heights.”

A sign of that came through this afternoon itself, when the sensex retreated from its intra-day high of 4026.27, slipped below 4000, but bounced back to close at 4006.91 —up 29.18 points against its previous close of 3977.73; the BSE-100, however, dropped 8.18 points to 2072.89.

The march left steel companies by the wayside, as their shares slumped on bouts of profit-booking after Monday’s show-stopper performance sent SAIL racing past Wipro in market capitalisation sweepstakes. The PSU did touch new highs today but failed to hold on to the gains. At the close, most firms found themselves in the red.

In fact, the 50-share National Stock Exchange index closed 0.29 per cent lower at 1277.70 points largely because of the manner in which the SAIL share gyrated. The other reason was that losers outnumbered gainers by one on the country’s biggest exchange.

In the BSE’s A group, only 59 stocks, including 11 from the index, advanced, while 136 lost ground. Dalal Street’s turnover rose to Rs 2188.61 crore from Rs 1706.90 crore.

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