The Hindu Business Line : Markets on downhill on allround selling

MARKETS took a sharp nose-dive on the last trading day of the week. The fears of delay in reform process, on the back of the statement made by the Left parties — the CPI(M) and CPI — calling for scrapping of the pro-active disinvestments policies, appeared to have weighed heavily on the secondary markets.

The stocks of several State-owned firms and banks slipped into the red.

The benchmark BSE Sensex witnessed a historic fall, as it spiralled down by a whopping 329.6 points (6.1 per cent).

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The drop would have been much higher if the Sensex was not a free-float index. The NSE's S&P CNX Nifty, which is not a free-float index, shed 7.9 per cent — a good 1.8 percentage point higher.

The 30-stock index opened at 5409.34 points, slightly above the previous day's closing, steadily declined through the day.

Heavy selling pressure in key index heavyweights and PSU stocks saw the Sensex to close at 5069.87 points, about 26 points above the day's low 5043.99 points.

On the BSE, all the indices closed on a negative note. Sharp fall in the indices BSE-PSU (14.41 per cent) and the Bankex (10.59 per cent) also indicate that selling pressure witnessed by PSU stocks and banking stocks respectively.

On the NSE, the 50-stock S&P CNX Nifty plummeted by 135.1 points to 1582.4 points. Mid-cap stocks also witnessed strong selling pressure as the 200 stock index, CNX MidCap 200, fell by 7.8 per cent.

Of the total 1,796 stocks that were traded on the BSE, 198 saw their values appreciate, 1,546 declined and the rest remained unchanged. All the Sensex constituents, however, closed the day on a negative note. Key index heavyweights Reliance Industries and ICICI Bank fell by 6.8 per cent and 7 per cent respectively.

The stocks of Infosys Technologies (2.3 per cent) and ITC (3.5 per cent) also closed the day lower.

Index constituents that declined over 10 per cent include ONGC (12.5 per cent), State Bank of India (14.8 per cent), Hindustan Petroluem (12.8 per cent), Bharti Tele-Ventures (10.3 per cent), BHEL (14.8 per cent) and MTNL (13.1 per cent).

Several bank stocks registered sharp fall on Friday.

Coupled with huge surge in volumes, Syndicate Bank (21.1 per cent), Bank of Baroda (19.6 per cent), Allahabad Bank (17.4 per cent) and IndusInd Bank (15.6 per cent) declined in value.

Biocon fell 3.9 per cent despite posting a strong earnings growth in the recently concluded fiscal. The company's net profit grew over 100 per cent to Rs 138.6 crore. The company has also recommended a 20- per cent dividend for its equity shareholders.

The stock of Mercator Lines fell 5 per cent to Rs 257.1. The company plans to allot 3 lakh equity shares of the company of Rs 10 each, on preferential basis, at a premium of Rs 265 per share to a foreign institutional investor, The Indiaman Fund, Mauritius.

Other stocks that registered sharp fall include Balmer Lawrie (20 per cent), Chennai Petroleum (19.9 per cent) and Rashtriya Chemicals (19.8 per cent).

The stock of Dewan Housing Finance rose by two per cent to Rs 28.3. For the year ended 2003-04, the company has recommended a special dividend of 10 per cent to its equity shareholders in addition to the annual dividend of 15 per cent.

Among the gainers were Tanu HealthCare (12.9 per cent), Petron Engineering (2.5 per cent) and Cummins India (1.4 per cent).

Other stocks that edged up marginally include Gati, Britannia Industries, GlaxoSmithKline Consumer HealthCare and Sun Pharma.

The stocks that registered sharp surge in trading volumes are SAIL, Tata Steel, Union Bank, Maruti Udyog, Petronet LNG, Tata Motors, GAIL, Power Trading Corporation and Tata Teleservices.