The Hindu Business Line : HLL leads fall as 3-day rally snaps

DRIVEN primarily by weakness in FMCG major Hindustan Lever, the three-day rally at the markets came to a halt. The Sensex ended the day at 6027.02 points, a drop of 8.78 points compared to its close on Tuesday; the Nifty ended at 1916.45 points, a fall of 3.65 points vis-à-vis its Tuesday's close.

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Intra-day movement of the indices continued to be range-bound, as the markets once again displayed an inability to hold on to the gains made during trading. The Sensex opened firm at 6060 points higher than its previous close by about 25 points - and scaled an intra-day high of 6082 points. The sell-off at the markets commenced in the last hour of trading, which saw the market shed in excess of 40 points from the 6070-level.

The fall in the Nifty mirrored that of the Sensex; at the current level, the Nifty is just four points away from the crucial technical level of 1920 points, the breach of which is expected to impart bullishness to the market.

Market participants were clearly disappointed with the year-end and fourth-quarter numbers declared by Hindustan Lever on Tuesday, which reported an almost flat three per cent growth in earnings for the quarter ended December 2003. The stock, which shed close to Rs 7 during Tuesday's trade, continued to be on a southward trajectory as it gave up a further Rs 5.2 and ended the day at Rs 187.60.

Technology stocks in the index did not have a day to write home about either. Infosys Technologies, Wipro and Satyam Computer all ended the day in negative territory. Among other stocks in the Sensex, no significant moves were seen on any counter barring that of ONGC and Gujarat Ambuja. The former notched up gains of Rs 52.25 to finish at Rs 769.4; the latter put on Rs 9.15 to finish at Rs 319.45, on the back of reports that cement players might raise prices by as much as Rs 15 per 50-kg bag. Interestingly, the stock prices of other cement companies such as ACC, Grasim and L&T ended the day lower.

Outside of the Sensex, the counters of companies such as CMC and IPCL also witnessed heightened activity, in the run-up to the Government liquidating its residual stake in both these companies through the book-building route.

The Government announced, after market hours, that shares in IPCL would be made available to retail investors at a minimum price of Rs 170. This represents close to a 13 per cent discount compared to its closing price of Rs 191.9, which the stock settled at after posting a gain of Rs 11.55 compared to Tuesday's close.

Likewise, CMC, too, put on Rs 34.35 to end at Rs 565.2; CMC's offer for sales opens on February 23. The price band at which investors could apply for the shares would be made known a day prior to the date of opening of the issue.

Among other stocks, FDC continued to make swift progress, after it announced a couple of days ago that its board would consider a bonus issue. The stock has been on a tearing run ever since the announcement was made and has put on close to 30 per cent since Monday. FDC closed at Rs 117.35 - a gain of Rs 8.75 - on the back of trading volumes of about 1.3 million shares.

Another stock that was buzzing around was that of transformer manufacturer Emco, in which Reliance holds a minority stake. The stock jumped by over Rs 13 to end at Rs 109.55, accompanied by an almost-nine-fold jump in trading volumes. Compared to trading volumes of about 35,000 shares on Tuesday, volumes leapt to about 3.1 lakh shares on Wednesday.

A few other prominent gainers include MICO, MRF, Television Eighteen, Cadila Healthcare, Torrent Pharma, SSI Ltd and Nicholas Piramal.