Mumbai: Bolstered by arrival of monsoon and continued net investments by foreign funds, the SENSEX extended its gains to third week in a row and spurted by 1.54 per cent to end the week under review at 21-week high on the Stock Exchange, Mumbai (BSE).

Positive Foreign Institutional Investors (FII) activity had prompted speculators to enlarge their positions in several blue-chip stocks while private mutual funds were believed to be making investment buying.

The BSE benchmark 30-share Index gained 9.98 per cent or 304.30 points during the three-week rally that was more pronounced in Pharma, Power, Auto and PSU sectors.

Net investments by FIIs have grown substantially in the preceding three weeks with fresh net purchases of Rs 210 crore in the first four sessions of the week.

The onset of monsoon and reports of good rainfall in 2003 have also enthused operators which have started building up positions in many counters including heavy weighted stocks.

The smart rally in PSU stocks was attributed to an overwhelming response to Maruti Udyog's (MUL) initial public offering (IPO) during the last two sessions. FIIs were believed to have accounted for majority of the bids for MUL's maiden public offer.

Heavyweighted counters like HLL, Bajaj Auto, Hero Honda, BHEL, BSES, L&T, Ranbaxy Lab, Cipla and Infosys Technologies were the major contributors to the SENSEX rally.

Bank stocks, however, suffered a sharp setback due to selling pressure by retail investors.

PTI