The Hindu Business Line : Benchmark indices slump again

THE recovery witnessed on Tuesday turned out to be short-lived as the market sentiment turned bearish on Wednesday. Led by the weakness in Reliance Industries, key benchmark indices - BSE Sensex and S&P CNX Nifty registered a sharp drop on Wednesday.

The Sensex dropped by 116.29 points or 2.03 per cent to close at 5618.15. The S&P CNX Nifty declined by 34.55 points to settle at 1786.8. Reliance Industries followed by ITC, Tata Engineering and State Bank of India inflicted much of the damage to the indices. The share price of Reliance Industries dropped by Rs 12.05 to Rs 554.30. The stock has declined by about 10 per cent in the last couple of weeks.

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ITC's share price declined by Rs 42.60 or 4 per cent to Rs 1,071.70 and Tata Engineering's by Rs 28 to Rs 497. Apart from Tata Engineering, a host of other automobile stocks too found a place in the losers list. Prominent losers include Hero Honda, Maruti Udyog and Ashok Leyland.

The share price of Maruti Udyog closed at Rs 486.30, down Rs 14.20 from Tuesday's close of Rs 500.50. The drop in value was however on the back of reduced trading volume. From 71.87 lakh shares traded on Tuesday, trading volumes dropped to 46.79 lakh shares on Wednesday.

HDFC, Larsen & Toubro, Dr. Reddy's Laboratories and Cipla constitute the list of gainers out of the Sensex constituents. The share price of Cipla shot up by Rs 47.95 to Rs 1,241.95. Trading volumes increased to 72,212 shares from 19,979 shares recorded the previous day.

Along with Cipla and Dr. Reddy's, quite a few stocks from the pharma sector managed to seek higher levels. Prominent gainers include Matrix Labs, Divi's Labs, Abbott and Aurobindo Pharma. The share price of Divi's Labs logged an impressive 10 per cent rise to close at Rs 1,913.75. Trading volumes zipped to 45,192 shares from 9,836 shares.

While quite a few stocks from the pharmaceutical sector settled at higher levels, the likes of Novartis, Ranbaxy Laboratories and Nicholas Piramal were confined to the losers list. The share price of Ranbaxy dropped by Rs 19.70 to Rs 951.60. Trading volumes rose to 1.42 lakh shares from 84,612 shares.

The stocks from the technology sector, too, took a beating on Wednesday. Top companies such as Infosys, Satyam and Polaris Software were prominent losers. The share price of Infosys declined by Rs 82.55 to close below the psychological Rs 5,000-point mark at Rs 4,957.8. Trading volumes dropped to 1.84 lakh shares from 2.9 lakh shares recorded the previous day.

While the technology sector did not quite have a memorable day, Hughes Software managed to buck the trend. The share price of Hughes Software shot up Rs 20.80 to Rs 607.90. Trading volumes increased to 72,300 shares from 29,836 shares.

The shares of Patni Computers got listed on Wednesday. After touching a high of Rs 305, the stock closed at Rs 233.20. The company came out with a public offer early this month at a price of Rs 230 per share. The company also found a place in the top traded counters of the day. Close to 60.5 lakh shares were transacted on Wednesday.

The recent bearish sentiment in PSU stocks was evident during Wednesday's trading as well. A host of PSU stocks settled on a weak note. The list had a fair representation of companies that are disinvestment candidates. BPCL, IBP and Dredging Corporation were among the prominent losers.

The share price of Dredging Corporation declined by Rs 66.90 or about 13 per cent to Rs 460.85. Trading volumes saw a manifold jump to 20,997 shares from 3,827 shares recorded the previous day. The price band for the offer for sale of Dredging Corporation's share has been fixed at Rs 385-Rs 400.

CMC was, however, a prominent absentee from the list of PSU stocks that registered a decline on Wednesday. The share price of CMC increased to Rs 540.45 from Rs 526.30. Trading volume, however, dropped to 12,150 shares from 14,072 shares.