The Hindu Business Line : Profit booking dampens bank stocks

The BSE Sensex opened the day on a weak note, at 5847.9 points, fluctuated by 123 points intra-day, but closed the day just a shade lower than Thursday, at 5850.7. The Nifty closed 5.5 points lower at 1852.6 levels. The mid-caps appear to have borne the brunt of the day's selling, with the indices such as the Junior Nifty registering bigger losses than the large cap indices.

The Junior Nifty fell by 0.9 per cent during the day, against the Nifty's loss of 0.3 per cent. The day was marked by intense selling in banking stocks, especially of the private sector banks. Automobile stocks were in favour, registering sharp gains during the day.

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It was a mixed day for the index stocks, with advances and declines equally matched within the Sensex basket. The banking stocks, notably ICICI Bank and HDFC Bank, weighed down the index, and so did the FMCGs. The ICICI Bank stock lost Rs 13 during the day, to close at Rs 297.6, while HDFC Bank plunged by Rs 10.8 to close at Rs 363.7.

HDFC fell Rs 24.8 and closed at Rs 651.6. But SBI proved the exception with the stock closing on a firm note at Rs 605.8. FMCG stocks such as Hindustan Lever and Colgate Palmolive India also had a rough day, as investors continued to marked down the stocks after HLL's declared modest growth numbers on Tuesday.

The ITC stock proved the exception, gaining Rs 18.2 during the day's trading to close at Rs 1094.8. Other index gainers were Reliance Energy (BSES), which was up by Rs 19.2 and Hero Honda, which surged by Rs 23.5 to close at 513.6. It was a fairly good day for automobile stocks, with Ashok Leyland also making it to the gainers list, notching up a 3.4 per cent appreciation on Friday's trading. The BSES stock was buoyed by news that it was pitching for power distribution contracts in 12 circles in Gujarat state.

Friday was the opening day of the book-building offer for PSU major - IPCL. Reports of enthusiastic response to the offer on its first day set the stage for trading in other PSU stocks which are lined up for IPOs. Despite frenetic trading in the stock, IPCL made only marginal gains on Friday, closing at Rs 196.3. IBP and Dredging Corporation, which are also set to be divested over the next couple of months, registered strong gains during the day. While IBP rose by Rs 21.3 to close at Rs 716.5, Dredging Corporation gained Rs 10 and closed at Rs 524.5. But oil majors ONGC and GAIL ended the day without registering any significant gains. Among the B1 stocks, the notable gainers were Hindustan Zinc (up 6.7 per cent) and EIH (up 3.2 per cent).

Among the stocks that lost ground during the day were CMC, which is set to open its IPO next week, and SAW Pipes. While CMC lost Rs 31.5 to close at Rs 541.9, SAW Pipes lost Rs 13.5 to close at Rs 233.6.

A couple of pharma stocks also saw hectic activity on Friday. The Divi's Labs stock swung between Rs 1670 and Rs 1820 during the day's trading, before closing the day on a strong note at Rs 1765. During the day, the company denied speculation about an imminent bonus offer and a stock split.

Matrix Labs attracted active trading during the day, and closed with gains of Rs 14.8, at Rs 1534.3.

The Daewoo Motors stock attracted significant trading interest, on reports that its assets could be bought out by General Motors. But a company spokesperson denied the possibility; and the stock closed marginally lower at Rs 9.1.