There was much cheer in the market today on news that the southwest monsoon had reached the shores of Kerala and was poised to cross southern Karnataka in the next 48 hours.

Old Economy and defensive sector stocks, in particular, headed north, giving the BSE Sensex its fourth straight rise, up 34.07 points to 3,337.31, its best close since 23 January 2003.

The NSE S & P CNX Nifty Index rose 5.70 points to end at 1,052.10.

The market remained firm for a better part of trading today after a volatile opening. Frontline tech stocks eased, led by the Digital GlobalSoft counter, which crashed after the company announced expensive merger terms with a unit of Hewlett-Packard Co. Old Economy and defensive sector stocks gained ground following the arrival of monsoon.

Monsoon rains hit the southern coast of Kerala on Sunday, after a week's delay. According to the Indian Meteorological Department, while the monsoon advanced into Kerala, conditions are favourable for its advance into South Karnataka in the next 48 hours.

The undertone of the market is optimistic; with signs of improvement in the economy prompting positive sentiment. Outsourcing stories have lifted stocks in sectors like auto ancillaries, pharmaceuticals and consumer electronics. MQ 2003 and FY 2002-03 results of companies in Old Economy sectors like cement, steel, banking and automobiles have been impressive.

Meanwhile, FIIs have substantially upped investments on domestic bourses in the last few sessions. FIIs stepped up their purchases substantially on Thursday, 5 June 2003, putting in a net Rs 213 crore, compared to Rs 56 crore in the previous session. For the first four sessions of June 2003, FIIs have remained net buyers to the extent of Rs 477 crore.

Lubricants major Castrol India (up 7.60% to Rs 208.75) firmed up on sustained buying interest. From a recent low of Rs 185 (ex-dividend), touched on 4 June, the Castrol stock has risen 13% on value buying.

Cement pivotals L & T (up 6.34% to Rs 229.80), ACC (up 2.70% to Rs 152.05) and Gujarat Ambuja Cements (up 0.46% to Rs 185.65) rose on buying interest. The large cement plants reported an impressive 17.2% jump in cement dispatches in May'03 to 10.56 million tonnes from 9.01 million tonnes in May'02.

FMCG pivotals Hindustan Lever (up 4.51% to Rs 169.10), Colgate Palmolive (down 0.85% to Rs 149) and ITC (up 1.05% to Rs 713.20) made gains following the arrival of monsoon. The June-September monsoon, which is very important for the overall agriculture-dependent Indian economy, decides the fortunes of the FMCG sector.

Exports-focussed drugs major Ranbaxy Labs (up 3.50% to Rs 710.65) rose to touch a new high of Rs 715 on hopes of a better future performance. The pharma major has charted a 10-year roadmap to emerge as a major research centre and to become a global player with a $ 5-billion turnover by 2012.

PSU pivotals Bhel (up 3.29% to Rs 256.15), MTNL (up 1.21% to Rs 104.50) and HPCL (up 0.73% to Rs 316.85) advanced as well.

Tech bellwether Infosys Tech bounced back from a low of Rs 2,881.25 to a high of Rs 2,999 before settling at Rs 2,983.65, up 1.04% over its previous close.

Tata group flagship Tata Steel (down 3.77% to Rs 155.75) ended off its day's low of Rs 152 . The stock was quoted on ex-dividend basis on the bourses today. The company had declared 80% dividend for FY 2002-03. Over 16.93 lakh Tisco shares were traded on BSE today.

Tech pivotals Satyam Computer (down 1.39% to Rs 177.85) and HCL Tech (down 0.69% to Rs 143.80) ended lower – although off their day's lows – on profit booking after recent gains.

Weakness in heavyweights Reliance Industries (down 1.87% to Rs 307.35) and State Bank of India (down 0.77% to Rs 363.10) limited the gains of the Sensex.

Digital GlobalSoft (down 25.54% to Rs 372.35) crashed – although ending off its day's low of Rs 330.15 – after the company announced that it has signed a definitive agreement with HP, its parent company and its majority shareholder, to combine with HP Services' India Software Organization (HPS ISO), establishing a significant services company with HP as a key investor, customer and supporter. Following the merger, Digital's equity capital will increase to Rs 60.8 crore from Rs 33 crore and HP's stake will initially increase to 73.2%. Over 36.29 lakh Digital GlobalSoft shares were traded on BSE today.

Wipro (down 2.46% to Rs 850.20) also lost ground on profit booking after recent gains.

Hinduja TMT (Rs 269.90) hit the 20% upper limit of the circuit breaker, with over 17.59 lakh shares traded on the counter on BSE.

Non-Sensex frontline tech stocks Mascot Systems (up 14.98% to Rs 113.95), NIIT (up 2.26% to Rs 141.55), Polaris Software (up 1.49% to Rs 109.20), I-flex solutions (up 0.33% to Rs 867.05) made gains in varying degrees.

ETC Networks (up 12.12% to Rs 53.25), TV 18 India (up 10.09% to Rs 93.30) and Balaji Telefilms (up 9.40% to Rs 63.45) advanced on renewed buying in non-Sensex media stocks.

Neyveli Lignite (down 3.55% to Rs 33.95) ended lower, coming off from the day's high of Rs 37.45 after the company announced results. For quarter ended 31 March 2003, the company posted a net profit of Rs 602.25 crore (Rs 276.96 crore) on total income of Rs 1,283.70 crore (Rs 766.32 crore). For the year ended 31 March 2003, the company's net profit stood at Rs 1,150.84 crore (Rs 819 crore) on total income of Rs 3,163.11 crore (Rs 2,421.79 crore). The company's board proposed a 14% dividend for FY 2002-03. Over 22.68 lakh Neyveli shares were traded on BSE today.

PSU banking stocks Union Bank (down 4.58% to Rs 35.45), Vijaya Bank (down 4.25% to Rs 21.40), Syndicate Bank (down 3.57% to Rs 24.30) and Punjab National Bank (down 1.60% to Rs 150.20) ended lower on selling pressure after recent gains.

Due to the flip-flop on the part of the Centre over the issue of pricing returned equity, PSU bank stocks are witnessing a fair amount of volatility. The volatility is likely to continue till there is a concrete decision by the Centre in this regard.

Corporation Bank rose from a low of Rs 161 to a high of Rs 181.50 before settling at Rs 177.90, up 9.07% over its previous close.

Steel stocks Essar Steel (up 19.98% to Rs 12.07), Mukand (up 16.57% to Rs 20.05), Kalyani Steels (up 16.48% to Rs 21.20), Steel Authority of India (up 15.68% to Rs 14.39) made spectacular gains on hopes of firm steel prices.

Source: Capitalmarket.com