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Equity Markets Close Higher

The equity markets closed higher for the third successive week ended May 20, 2005. While the 30-stock BSE Sensex gained 0.74 per cent, the 50-share Nifty ended the week up 0.21 per cent

The equity markets closed higher for the third successive week ended May 20, 2005.

While the 30-stock BSE Sensex gained 0.74 per cent, the 50-share Nifty ended the week up 0.21 per cent. Among the broader indices, S&P CNX 500 also showed positive trends and closed 0.17 per cent higher. The rise in the mid-cap stocks was the most impressive--the CNX Midcap 200 gained 1.34 per cent during the week. A steep fall in global crude oil prices accompanied by a rebound in the US markets helped the Indian equity markets.

Among the sectoral indices, the BSE IT index gained the most. It rose 4.10 per cent during the week, thanks to a 5.4 per cent surge in the Infosys Technologies. Satyam Computers and Wipro also gained close to 4.5 per cent each. The BSE Bankex rose 1.12 per cent as India's leading bank, State Bank of India, gained 4.78 per cent during the week after it reported good Q4 results.

The BSE FMCG index gained 0.41 per cent, while the BSE Metal index skidded 2.32 per cent. The BSE PSU index slipped 0.65 per cent during the week. The slide in the BSE Healthcare index was even more pronounced, as it slipped 0.74 per cent. Cipla and Ranbaxy Laboratories lost 3.15 and 0.48 per cent, respectively.

The top gainer at the Sensex was Bajaj Auto. The stock surged 6.9 per cent over the week. Larsen & Toubro followed with a 6.1 per cent rise. Prominent losers of the week included Zee Telefilms and Reliance Energy, which fell by 5.6 and 4.6 per cent, respectively.

Foreign institutional investors (FIIs) continued to pull out from the Indian equity markets for the second consecutive week. The total outflows amounted to Rs 446.8 crore during the week ended May 20, 2005. Mutual funds, on the other hand, pumped in over Rs 1,125 crore. The average turnover remained at over Rs 6,000 crore.

Outlook

Equity markets are expected to remain in the positive territory in days to come. However, the strong FII outflows in the past few weeks will deter any massive surge in the indices. Some prominent names, which are scheduled to announce their Q4 results next week, will give direction to the markets. They include ITC, L&T, SAIL, HPCL, Oriental Bank of Commerce, Britannia Industries and a few others. The expiry of futures contract on the last Thursday of the month will also help set the course of equity markets in the following week.