Equities were under tremendous pressure as investors squared off positions at any available price on growing concerns over health of global economy. Benchmarks broke crucial support levels after heavy selling emerged in heavy-weight stocks like Reliance Industries, Infosys Technologies andICICI Bank.
Markets were meanwhile shut from 11:25 am to 12:10 pm due to sun-outage. As per the last updated data, Bombay Stock Exchange’s Sens*x fell 859.37 points or 7.35 per cent to 10,835.87. The index sent jitters in the market by breaking crucial 11,000 mark. It touched low of 10782.76 in the trade so far.
National Stock Exchange’s Nifty was at 3,360.20, down 6.83 per cent or 246.40 points after hitting an intra-day low of 3348.60. It breached two psychological support levels of 3500 and 3400.
BSE Midcap Index plunged 8.63 per cent and BSE Smallcap Index declined 7.48 per cent.
“Nifty futures witnessed an increase in OI by 1.76 per cent along with a marginal increase in Nifty futures price by 0.19 per cent. The PCR-OI increased marginally from 0.79 to 0.8. The options data shows 14300 contracts addition in 3700 Call. Also, 3600 Call added 9001 contracts. Hence, markets may find difficult to close above the 3600 mark on a closing basis. FIIs have been net sellers to the tune of Rs 680.42 crore in the cash segment, whereas DIIs have bought Rs 548.29 crore. The immediate supports for the Nifty are at 3540, 3478 and resistances are at 3690 and 3730,” said ICICI Securities.
“India is one of the two markets where we have a consensus underweight recommendation. Even though the market has underperformed Asia the most year-to-date, it is still trading at an 88% premium to the region on P/BV and 34% on P/E,” said Confederation of Indian Industries.
Meanwhile, CLSA has forecast end-FY10 Sens*x target at 9,500.
Sterlite Industries (-14.34%), Satyam Computer Services (-13.10%), HDFC Bank (-11.50%), Jaiprakash Associates (-11.34%), Tata Steel (-10.40%), Reliance Communication (-10.21%), Tata Power (-10.11%) were the major Sens*x losers and no gainers.
Amongst the sectoral indices, BSE Realty Index tanked 10.15 per cent, BSE Metal Index plunged 9.93 per cent and BSE Bankex fell 9.11 per cent.
Amongst realty stocks, Indiabulls Realty fell 23.25 per cent after it posted a 77 per cent fall in its consolidated net profit of Rs 7.89 crore for the quarter to September 30. Mahindra Life Sciences was down 17.68 per cent, HDIL slipped 17.83 per cent, Akruit City fell 13.58 per cent and DLF were down more than 6 per cent.
Brokers point out that the street is concerned that a potential recession in the USA in the short term, could put further pressure on LME non-ferrous prices over the next few quarters. Also, contributing to lacklustre interest in the non-ferrous metal sector is the uncertainty regarding the subscripttion levels for the current rights issue of Hindalco.
IT stocks continued to languish and traded at fresh 52 week lows in the first hour of Wednesday trade - Infosys touched a 52-week low of Rs 1196 on Wednesday, while TCS touched a 52-week low of Rs 516.95 - clearly with the American economyclose to recession, investors are exiting IT stocks ahead of their quarterly results declaration shortly. BSE IT Index was down 8.93 per cent.
Among technology stocks, Tata Consultancy Services and Wipro had their stock rating cut to 'sell' from 'neutral' at Goldman Sachs. Meanwhile, Goldman Sachs revised Satyam Computer Services' rating from 'buy' to 'neutral'.
Weighing on the BSE Capital Goods Index were Larsen and Toubro, down 5.86 per cent, slipped below Rs 1000 and was trading at Rs 949. Reliance Industrial Infrastructure lost 11.27 per cent, Suzlon Energy hit a fresh low of Rs 106.60, down 14.45 per cent and BHEL shed 4.33 per cent.
Market breadth was negative on the BSE with 2043 losers and 189 gainers.
Courtesy: ET
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