Sustained selling pressure in tech as well as select Old Economy stocks dragged down the market further on Thursday, after a steady opening.

Moving in a intra-day range of 35 points, the 30-share BSE Sensitive Index (Sensex) settled with a loss of 16.30 points at 3,040.79.

The NSE S & P CNX Nifty Index shed 4.75 points to close at 963.25.

Despite weakness, the overall trend in the market was mixed. While gains continued in some Old Economy stocks, tech stocks slipped on sustained selling pressure following the recent strengthening of the Indian rupee against the US dollar. Stocks of public sector undertakings (PSUs) and banks advanced further on sustained buying support. Defensive sector stocks displayed a mixed trend. Stock-specific activity continued on the side counters.

The undertone of the market remained cautiously optimistic amid hopes that a satisfactory rainfall this year may boost the demand for goods and services in the country's farm-dependent economy. According to reports, this year's monsoon is expected to be close to normal, after the nation faced its worst drought in 15 years in 2002.

Meanwhile, foreign institutional investors (FIIs) have stepped up their purchases on the bourses. On Tuesday (20 May 2003), FIIs pumped in a net Rs 88.60 crore, compared to their inflow of Rs 51.20 crore on Monday (19 May 2003).

ICICI Bank (down 5.92% to Rs 131.15) lost ground on selling pressure after a recent recovery from the lower levels. Close to 3 lakh ICICI Bank shares were traded on the BSE.

Hero Honda Motor (down 4.79% to Rs 222.75) slipped on profit-booking.

HCL Technologies (down 4.66% to Rs 122.75), Infosys Technologies (down 3.53% to Rs 2,689.05) and Satyam Computer (down 3.47% to Rs 160.10) lost further ground amid fears that the strengthening Indian rupee will further squeeze the margins of the tech sector.

After touching its two-year high of 46.75 on Wednesday, the rupee was trading at 46.90/91 against the US dollar on Thursday.

Heavyweights like ITC (down 1.72% to Rs 693.55) and Hindustan Lever (down 0.68% to Rs 147) also accounted for the weakness in the Sensex.

Hindalco (up 3.55% to Rs 686) gained further ground on sustained buying support. Over 29,000 Hindalco shares were traded on the BSE.

GlaxoSmithKline Pharma (up 2.63% to Rs 364.95) rose on selective buying support following reports that the company has received bids up to Rs 80 crore for its Worli real estate.

Tisco (up 1.24% to Rs 142.95) and Telco (up 1% to Rs 166.20) rose on sustained buying support following the hopes of improved results from these companies next week.

Reliance Industries (up 0.94% to Rs 275.05) and State Bank of India (up 1.03% to Rs 328.15) limited the Sensex's loss.

L & T (up 0.85% to Rs 207.50) and Grasim (up 0.79% to Rs 383.40) held on to their gains on selective buying support.

Ramco Systems (up 6.91% to Rs 462) gained further ground on sustained buying support amid rumours of the company bagging a major overseas order.

Hexaware (up 1.04% to Rs 112.05) ended flat, off its day's high of Rs 124.40 on selling pressure. The stock rose by over 12% earlier in the session after PeopleSoft announced that it will expand its presence in India with an investment of around $ 30-40 million. The investment, which would be made over a three-year period, is focused on establishing and growing its new services centre in Bangalore, in partnership with Hexaware.

Non-Sensex frontline tech stocks like Hughes Software (down 8.14% to Rs 203.25), Polaris Software (down 6.55% to Rs 113.45) and Wipro (down 3.95% to Rs 824.05) lost ground on selling pressure after recent gains.

Banking sector stocks like Bank of India (up 7.24% to Rs 48.15), Bank of Baroda (up 5.68% to Rs 128.35), J & K Bank (up 4.76% to Rs 207.80), Punjab National Bank (up 3.99% to Rs 149.75) and Oriental Bank of Commerce (up 2.09% to Rs 134.30) rose further on sustained buying support.

Alembic (up 7.50% to Rs 208.65) rose after the company announced that it is planning to expand its bulks drugs business to the highly regulated US markets by joining hands with certain America-based formulators.

Divi's Laboratories (up 3.51% to Rs 331.85) firmed up, rising from the day's low of Rs 316, on fresh buying support after the company announced its results. For the quarter ended 31 March 2003, it posted a net profit of Rs 19.16 crore on sales of Rs 63.15 crore. The company declared a 60% final dividend for FY 2002-03.

Shaw Wallace (up 10.19% to Rs 40) advanced following reports that SABMiller Plc., the world's second-largest beer company, will take management control of Shaw Wallace Breweries, a 50:50 joint venture between Shaw Wallace and Mysore Breweries, a subsidiary of SABMiller India. The two parties have decided to combine their operations in India in the largest merger-cum-acquisition in the liquor industry. They will have 50% stake each in the merged entity, with SABMiller investing $132.8 million (Rs 625 crore) in it.

Arvind Mills (up 5.79% to Rs 38.40) rose on the back of reports that the textiles major is set to report its highest-ever net profit of Rs 128 crore on a turnover of Rs 1,500 crore for the year ended 31 March 2003. The company had reported a loss of Rs 500 crore for the 18-month period, less than two years ago.

Fertiliser PSU stocks like Madras Fertilizers (up 9.77% to Rs 11.80), RCF (up 8.82% to Rs 25.30), FACT (up 4.16% to Rs 31.30) and National Fertilizers (up 1.30% to Rs 38.90) gained further ground on sustained buying support following disinvestment hopes.

Other PSU stocks like Steel Authority of India (up 4.87% to Rs 10.95), Gas Authority of India (up 4.18% to Rs 91.05), Bharat Electronics (up 3.52% to Rs 290), Bharat Earth Movers (up 2.46% to Rs 82.30), Indian Oil Corporation (up 3.25% to Rs 302.25), Shipping Corporation of India (up 3.20% to Rs 70.90) and ONGC (up 2.78% to Rs 434.85) gained further ground on sustained buying support.

Source: Capital Market