The Hindu Business Line : Index heavyweights drive downtrend

The fall in index heavyweights of Satyam, Infosys, Reliance, ONGC, Wipro, Maruti, SBI, Grasim, Tata Motors and Hero Honda was significant in contributing to the languishness of the overall market, which kept the market sentiment subdued. While the Sensex closed the day with a marginal loss of 5 points, Nifty was down by 4.8 points.

The bellwether indices opened the day on a weak note and witnessed range-bound trading throughout the day. The Sensex opened at 6447.7, reached an intra-day low of 6418.7 before making a smart comeback at the close at 6451.5.

The 50-stock Nifty also remained weak as it reached an intra-day low of 1978.7 before settling to close at 1988.3, down by 0.2 per cent.

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Much of the action was seen in the small-cap space as stocks in this sector flared up. The BSE Small-cap index shot up by around 70 points and outperformed the benchmark index. Munjal Auto was a significant gainer whose stock flared up by 19.9 per cent. Aptech, Walchand India, Ajanta Pharma and Southern Iron and Steel also recorded sharp gains. On the NSE, the CNX Mid-cap 200 was an outperformer, which recorded a gain of 0.7 per cent.

There was mixed action and selective buying across the sectors. Bullish sentiment was strong in the pharmaceutical sector as the stocks rallied sharply. Aurobindo Pharma was up 1.2 per cent on reports that Israel's Teva Pharmaceutical Industries and the US based Mylan Laboratories are seeking to buy stakes in the company. Dr. Reddy's, Cipla, Glenmark Pharma, Pfizer and Merck ended the day with smart gains.

There was selective buying across the counters of auto and auto ancillary stocks. While most of the frontline stocks traded weak, fresh buying among the mid-cap stocks held the momentum. Asahi India, Rane Brakes, Cummins, Bharat Forge, MICO and Eicher Motors put up a smart show. However, MRF, CEAT, LML, M&M, Maruti, Tata Motors and Hero Honda ended in the red.

The metals sector continued to exhibit weakness on concerns of fall in global commodity prices. Southern Iron and Steel was a significant gainer whose stock shot up by 9.9 per cent. Tata Steel, Uttam Galva, Spat Industries, Jindal Vijaynagar Steel and Kalyani Steels recorded modest gains.

Jindal Steel and Power added Rs 8.30 after the company announced on Thursday that its Q4 profits have risen by 25 per cent. Sesa Goa, SAIL, National Aluminium, Hindustan Zinc and Bhushan Steel and Strips came in for selling pressure.

The bears were in total control of the IT stocks as most of the frontline stocks faced the brunt of selling pressure on concerns that a strengthening rupee would hurt the earnings of companies. However, mid-cap stocks stayed the flavour of the day. Those that gained significantly were Rolta India, Sonata Software, Polaris, NIIT, Aptech, i-flex and Ramco Systems.

Positive sentiment prevailed in the consumer goods sector as select stocks witnessed gains. HMT, Kirloskar Brothers, Greaves Cotton, BHEL, Thermax, ABB and Alstom Projects recorded handsome gains.

In the banking and financial sector, HDFC was a significant gainer which added Rs 22 to its stock (up 2.9 per cent) followed by Kotak Bank, Bank of India, Union Bank, ICICI Bank, SBI and HDFC Bank. Those that made the losers' pack were Corporation Bank, Indian Overseas Bank, UTI Bank and Canara Bank.

The other notable gainers on the Nifty were Engineers India, Titan, Tata Power, Asian Paints, Arvind Mills and Bombay Dyeing. Prominent among the losers were Raymond, Punjab Tractors, India Cements and Hindustan Motors.

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