Wednesday, January 5, 2011

Global cues drag Nifty below 6100; banks, cap goods dip

The benchmark Sensex shed around 200 points in afternoon trade while the Nifty was trading well below the 6100 level, led by further sell-off in financial, capital goods, realty, metal and auto companies' shares along with heavyweights ONGC (tanked 2%) and Infosys (down 0.8%). Reliance Industries too slipped into red.

Weak European cues weighed on markets; France's CAC, Germany's DAX and Britain's FTSE were down 0.5-1%. Even Dow Jones and Nasdaq futures declined 0.5% each.

Jim Walker, MD of  Asianomics said that Europe is a bigger problem than China and US. “Europe is going to see political turmoil,” he explained.

According to him, the US economy may see weakness in the next six months. Expressing concern, Walker stressed that there might be monetary tightening across Asia. He believes that the Reserve Bank of India (RBI) is likely to hike interest by 25 bps this month.

However, buying continued in ITC, TCS, Sun Pharma, Hindalco, HCL Tech, Tata Power, Wipro, GAIL, Reliance Power and Dr Reddy's Labs.

The 30-share BSE Sensex was trading at 20,253, with loss of 245 points and the 50-share NSE Nifty lost 80 points to 6,066. The broader indices too fell 1% each. However, the Nifty January futures were trading at 25 points premium.

In financial space, ICICI Bank and HDFC tanked 3.5% each. Axis Bank, HDFC Bank, SBI, PNB and Kotak Mahindra Bank were down 1.7-3%. DLF from realty pack fell 3%.

Bharti Airtel and Reliance Communications from telecom space slipped 2.2-2.7%. L&T and BHEL from capital goods segment were down 2.6% & 1.5%, respectively.

Bajaj Auto from auto pack lost 3%; Hero Honda, Tata Motors, M&M and Maruti Suzuki declined 0.7-2.7%. Sterlite Industries, Tata Steel and SAIL from metal space slipped 1.9% each.

In midcap space, Jindal Saw, KGN Industries, Shriram City, Eicher Motors and Bayer Cropscience were up 1.9-5.4% while Anant Raj Industries, GSFC, Syndicate Bank, Stride Arcolab and Amtek Auto fell 4-5.4%.

In smallcap space, Fame India shot up 18% as Reliance Mediaworks increased stake to 44% in company. Indo Tech Transformers rallied 17%. Transformers & Rectifiers, Navin Fluorine and DQ Entertain gained 6-9%.

However, Mandhana Industries, Sahara One, Splash Media, Shasun Chemical and SE Investments slipped 5-6%.

About 895 shares advanced as against 1993 shares declined on Bombay Stock Exchange.

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