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Moving Upstream

The stock markets bounced back during the week ending June 23. The 30-stock BSE Sensex closed up on four of the five trading days, gaining over 5.23 per cent over the previous week

Indian stocks staged a smart recovery in the week ended June 23, 2006. The 30-stock BSE Sensex closed up on four of the five trading days last week to end at 10,401 levels, a gain of over 516 points or 5.23 per cent. The Nifty too rose 5.27 per cent to touch 3,043 levels. Among the broader indices, S&P CNX 500 closed up 6 per cent. Mid-cap stocks were in high demand with the CNX Midcap index rising 7.45 per cent over the week.

Markets had a positive start to the week with the Sensex rising more than 1 per cent on Monday to a two-week high. Though rising interest costs and pullout by funds bothered investors, buying in bluechip stocks helped the index close up. Software major Infosys Technologies played a key role in the Monday's stock rally-the stock rose 2.5 per cent to Rs 2,871.4. Tata Motors ended 6 per cent up. Another index heavyweight Reliance Industries added 1.3 per cent. The news of investment of about $5.5 billion in a special economic zone in Haryana triggered buying interest in the stock.

Sensex crashed 2 per cent on Monday on weak Asian markets and concerns over rising interest rates and fund outflows. However, the weak sentiment gave way to strong comeback on Wednesday and investors thronged mid-cap stocks available at good bargains. The Sensex rose more than 217 points to close at its highest point in over two weeks. Both retail and institutional investors showed interest in mid-cap stocks available at attractive valuation.

Indian stocks continued to surge ahead on Thursday. The BSE Sensex closed more than 2 per cent up, extending gains for a second straight day on firm Asian markets and interest in infrastructure and banking stocks. The end to the week was equally good with the Sensex adding over 125 points on Friday. Metal stocks supported the rally.

Among the 30 Sensex stocks, as many as 27 ended the week in the green, while State Bank of India (-0.66 per cent), Dr Reddy's Laboratories (0.57 per cent) and BHEL (-0.13 per cent) lost over the week. The pack of gainers was led by 10.89 per cent rise in Tata Steel.

Under hammer for the past three weeks, metal stocks staged a strong comeback last week with the BSE Metal index rising 10.56 per cent through the week. Technology stocks too raced ahead with the BSE IT index gaining 5.49 per cent over the week. BSE PSU index added 5.44 per cent, followed by 4.21 and 4.15 per cent rise in the BSE Healthcare and BSE FMCG indices, respectively.

The combined daily turnover on both the exchanges dropped by 4.76 per cent to Rs 9,276 crore. Foreign institutional investors injected close to Rs 371 crore into the equity markets, while domestic mutual funds invested Rs 67 crore over the week.