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Parekhs make the week eventful; Sensex down 75 points

Spotlight this week was on J C Parekh and Deepak Parekh. The former, the Bombay Stock Exchange president, was given marching orders by the market regulator. The latter, chairman of Housing Development Finance Corporation and the panel instituted by the Unit Trust of India to rejuvenate the Unit Scheme 64, submitted his report, which was perused by the UTI.

Nervous selling prompted by the crisis that has gripped the Bombay Stock Exchange, following sacking of its president J C Parekh liquidated initial gains during the week ended March 26.

Punters built heavy positions in the 'B1' and 'B2' group shares on the expectations of a further climb in equity values. Infotech, pharma and fast moving consumer goods scrips were in the reverse gear as they seem to have fallen out of favour with marketmen.

Marketmen said that the operators were on an overbought territory early this week on expectations that the benchmark Sensex would breach the 3,850 levels. Witnessing the post-Budget surge in the Sensex, the market players were hopeful that in the near short term, the Sensex would cross the 4000-levels.

However, Parekh's removal from office on March 24 following the Securities and Exchange Board of India probe into the alleged price rigging into BPL, Videocon and Sterlite scrips in May 1998 fuelled speculation that more heads would fall in the days to come.

The market recovered some of the losses as dealers covered positions ahead of the Sri Rama Navami holiday. Squaring-up of long positions on March 26, which was the last day of the trading cycle led the Sensex to experience an intra-day fall of 128 points.

However, buying support extended by the Unit Trust of India and foreign institutional investors in some index counters helped the Sensex to recover some lost ground on that day.

The BSE-30 Sensitive Index showed a net loss of 75.05 points during the week. The Sensex ended at 3597.58 on Friday from the previous week's close of 3672.63.

The BSE-100 ended at 1585.90, falling by 31.39 points from the previous close of 1617.29. The BSE-200 and Dollex ended at 365.52 and 143.53, exhibiting a net loss of 5.87 and 2.30 points respectively.

During the week, the Deepak Parekh report on the US-64 was deliberated upon by the UTI board, which approved a proposal to provide majority representation to outside experts on the asset management companies -- one each for US-64, equity and income schemes.

The report disclosed that since July 1998, US-64 has invested about Rs 12 billion in infotech, pharma and FMCG sectors.

The elections to the governing board of the BSE was held on Friday and four prominent members of the exchange were elected as directors.

Outgoing BSE president Parekh has moved the Appellate Authority of the finance ministry against the SEBI's decision. The authority will hear his plea on April 5. According to observers, a stay this implies that a stay may be granted to Parekh well beyond March 31, when his term ends.

On the National Stock Exchange, pivotals declined witnessed a decline during the week. The S&P CNX Nifty ended the week at 1041.25 from the previous close of 1060.35, showing a net loss of 19.10 points.

The CNX Nifty Junior closed 18.70 points lower at 1964.25, while the S&P CNX Defty declined by 15.60 points to end at 850.90.

The S&P CNX 500 and CNX Midcap 200 closed 14.29 and 10.48 points lower at 732.71 and 667.94.

UNI

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