Date:14/04/2004 URL: http://www.thehindubusinessline.com/2004/04/14/stories/2004041402560100.htm

Back Sensex up 120 points

Our Bureau

Mumbai , April 13

EXACTLY a year after rattling investors with gloomy earnings guidance, Infosys Technologies today made it up to them with a surprise bonus and dividend bonanza that set up listless indices for a fresh rally.

A three-shares-for-one bonus and 2,000 per cent special dividend announcement by the technology leader early in the morning set off a buying frenzy in technology shares. Riding on gains made by Infosys, Satyam and Wipro shares the BSE Sensex rallied 2.09 per cent and counterpart Nifty soared 2.19 per cent to five-week highs. The Sensex had fallen nearly 3.4 per cent on April 10, 2003, after Infosys said it was lowering its growth forecast.

The 30-share Sensex gained 120.73 points today to close at 5904.52, a level last seen on March 8. The broader 50-share S&P CNX Nifty of the NSE closed at 1878.45, up nearly 40 points from its previous close of 1838.20. Investor interest was fairly broad-based with 1,107 shares advancing on the BSE while only 725 declined.

"The market has entered a new zone. It may set a new record high," said an institutional dealer. A technical analyst said the Sensex has a resistance at around 6100 and Nifty around 1910. A private bank dealer said there was some sort of a consensus in the stock market that the Sensex would rise another 200-300 points.

The startling announcement from Infosys has raised expectation from rival Wipro's board meeting later this week to consider bonus. Wipro shares rose more than 10 per cent to close at Rs 1,605.10 as investors rushed to own them. In comparison, Infosys was up only 6.82 per cent at close at Rs 5,490.20, even though it had earlier touched Rs 6,000 a share. The euphoria touched off rallies in other technology shares buoying the BSETECk index 5.62 per cent to 1289.84 and the CNX IT by 7.10 per cent to 21923.60.

Even though technology shares starred in today's show, there were other props too.

Auto, cement and banking shares rose on good buying support.

Cement shares rose on reports that March cement production was up 9.2 per cent on month and sales stood at 11.3 million tonnes compared to 10.3 million tonnes in February.

Grasim gained 3.2 per cent to Rs 1,158.70, ACC was up 1.2 per cent at Rs 267.25, L&T rose 2.8 per cent to Rs 613.05 and Gujarat Ambuja rose 3.8 per cent to Rs 318.