Lacklustre trading on Lyons Range

By A Special Correspondent

KOLKATA, OCT. 7. The shadow caused by the terrorists attack in the U.S. continued to have its influence in market sentiment in Asia as a whole including Indian bourses because of the uncertainties in regard to retaliatory measures on the part of the U.S. and its allies to punish the wrong doers. There is a good deal of hesitancy to take on large commitments, both by speculators and investors, against the background of a threat of war. Consequently, the business volume continued to be at a low level on the Calcutta Stock Exchange last week.

The week witness repeated bouts of profit booking in the first half which in turn pulled down share values over a broad front and even the old economy counters, which had exhibited a firm tone on September 28, surrendered part of the gains.The CSE's 40- share index also wound up the week higher at 1510.43 against 1497.78 points.

Cement counters fared generally well although they too were initially subjected to profit booking with some reaction in their values. Attention to these shares came in the wake of reports that despatches of the commodity by major producers like ACC and Larsen and Toubro had risen appreciably during September holding out promises that this sector had a brighter future.

Yet another star performer in the week was the pharma counter, Ranbaxy, which rallied smartly on sustained support to close at Rs. 682.10 against Rs. 644.20 at close in the previous week. Software counters finished in the negative region due to profit taking.

Trading otherwise was lacklusture during the week at the CSE because of a general tendency to exercise caution in respect of fresh offtake by both speculators and investors taking into consideration the disturbingly persisting fear of war. Consequently, the marketmen in general appear to be not inclined to give much importance to otherwise encouraging developments like the recent interest rate cut for export credit, hike in draw back rates and this year's impressive monsoon falls which should help harvest a record agricultural production boosting the economy in a big way. This is the prime cause of the listless dealings and sideways movements in share values witnessed during the larger part of the period under review.

Part of selling that emerged in the market during October 3 session was induced by the Indo-Pak tension following a statement by the Jammu and Kashmir Chief Minister that the centre should launch an open war against Pakistan after the suicide bomb attack by militants near the Assembly premises in Srinagar. But this was partly offset by fresh purchases on behalf of domestic mutual funds led by the Unit Trust of India in key counters like ACC, Grasim, HLL, Telco and ITC which helped to cushion the fall in the sensex.

Meanwhile, the Joint Parliamentary Committee probing the multi- crore stock scam has summoned all the former Calcutta Stock Exchange directors to depose before it in Delhi on October 10. The unprecedented payment crisis at the CSE involving Rs. 258 crores occurred during the tenure of that board which was at helm of affairs during March this year. Some of the defaulting members were suspended at that time while the rest representing the brokers resigned in April stating that such a step would make investigations easier.

The main problem facing the CSE as of today is the disappointingly poor condition of the market in general with the business volume slumping to appallingly low levels making it difficult for most broking houses to maintain their set up.

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Section  : Business
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