Mumbai: Responding to slow flow of investments by foreign funds, IT stocks rallied further aiding the SENSEX to end the week past 3,000-psychological barrier on the Bombay Stock Exchange (BSE) even as the market seems to be in the grip of local operators.

Speculators have a strong grip on the market and they book profits whenever key counters witness a rally, brokers observed saying, "as a matter of fact, prices are being pushed up initially by punters to take advantage at higher levels".

Citing the changed scenario on the US markets which, finished their second consecutive week in positive territory as investors stepped up buying on some better- than-expected earnings reports, market sources said that foreign funds have started making net investments, particularly in IT stocks in the last four to five sessions.

Foreign institutional investors (FII) have made net purchases of Rs 87 crore between October 10 and 17 after being continued net sellers for several days.

Public sector undertaking (PSU) stocks recovered part of their early losses on reiteration by Prime Minister Atal Behari Vajpayee that economic reforms are irreversible.

L&T was the star performer having scored impressive gains during the week on consistent buying support prompted by the Grasim's announcement about an open offer for a 20 per cent stake in L&T at Rs 190 per share.

However, Pharma stocks were at a receiving end following the US court ruling on October 11 that Cipla's American alliance partner Andrx Pharmaceuticals' version of blockbuster ulcer drug Prilosec was patent infringing.

PTI