The Hindu Business Line : Bank stocks suffer the most; PSUs edge up

BEARS were back in action on Monday as the markets recorded a slide, snapping their six-day rally. The benchmark Sensex slipped by 75.9 points, while the broader Nifty was down by 17.5 points.

Markets on Monday opened on a cautious note and witnessed a lot of volatility. The BSE Sensex reached an intra-day low of 8568.9 before settling down at 8610.7.

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Although there was across-the-board selling, banking sector stocks were the worst hit. Mirroring the losses in these stocks, the BSE Bankex shed 2.3 per cent while the NSE-Bank Nifty lost 2.2 per cent.

The overall undertone was negative. Twenty out of the 30 stocks constituting the BSE-30 index shed value.

Prominent losers among the frontline stocks included the likes of Hindalco, ITC, ICICI Bank, HDFC Bank, Tata Steel, Satyam, Maruti, SBI, Bharti Tele-ventures and Ranbaxy.

Stocks of HLL, Infosys, Tata Power, Gujarat Ambuja, L&T, Wipro and TCS also ended on a weak note.

Mid- and small-cap stocks that witnessed a sharp rally over the past few sessions also wilted under market pressure. Ispat Industries, Maharashtra Seamless, Jindal Stainless, Gateway Distriparks, Alok Ind, ING Vysya Bank and Liberty Shoes succumbed to the bearish onslaught.

Fresh buying interest, however, lent support to select stocks. Rolta India, Berger Paints, Hindustan Organic Chemicals, Bombay Dyeing, Mukand and United Phosphorous perked up on the back of strong buying.

A majority of the stocks in the IT space could not withstand the selling pressure. While frontline stocks failed to attract market interest, a good number of them in the second-rung category also lost steam. Mastek, Aftek Infosys, Sonata Software, Cranes Software, Hexaware and Four Soft made it to the losers' list among others.

Profit-booking among the metals stocks dragged them down. Barring a few exceptions such as Kalyani Steel and GMDC, most of them lost sheen.

It was a dull day for stocks in the FMCG and capital goods sectors. Shaw Wallace, Britannia, ITC, Tata Coffee and Bata India recorded moderate losses. Tata Tea, CCL Products, P&G and Colgate Palmolive managed to reverse the negative trend.

Barring a few exceptions such as Siemens, Praj Industries, Esab India and Orient Abrasives, stocks in the capital goods sector failed to put up a smart show. ABB, KEC International, Astra Microwave and Elgi Equipment exhibited weakness.

There was a mixed bag of response among auto and auto-ancillary stocks. Hero Honda, Bajaj Auto, Maruti, Punjab Tractors, Amtek Auto and Kinetic Motors advanced while Maruti, Escorts, Eicher, Sundaram Fasteners, CEAT and Munjal Showa shed value.

Banking sector stocks came in for heavy selling pressure. Allahabad Bank, Kotak Bank, ICICI Bank, Bank of India, Indian Overseas Bank, HDFC Bank, Canara Bank, Union Bank, Andhra Bank, Vijaya Bank and UTI Bank suffered sharp losses.

There was selective buying interest among the pharmaceutical stocks, which helped them end the day with respectable gains. Ajanata Pharma, Aventis Pharma, Cadila Healthcare, Cipla, Sun Pharma, Dr Reddy's, Merck and Divi's Lab ended on a firm note. Matrix Lab, Dishman Pharma and Venus Remedies remained subdued.

Several stocks of PSUs jumped up on news reports that the Left had agreed for selling of minority stakes in select Government-controlled companies. Stocks of Shipping Corporation, Engineers India and Dredging Corporation attracted widespread buying interest.

Other prominent losers on the Nifty included the likes of Aegis Logistics, Era Constructions, GE Shipping, Macmillan, Monsanto, Suzlon Energy, Thermax and Visaka Industries.

Notable gainers included Essel Propack, Madhucon Projects, Titan, MM Forgings and Mahavir Spinning.

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