The Hindu Business Line : Cautious sentiment rules market

THE markets appeared to have been on a correction mode on Thursday, following a spate of gains over the two previous trading sessions. Frontline and small-cap stocks were in for some minor correction, while the acceleration appeared to have dropped in the mid-cap space. The cautious sentiment that prevailed following the sharp gains was reflected in the advance-decline ratio, which was tipped marginally in favour of the losers.

The correction mode appeared to have set in early in the day with the Bombay Stock Exchange (BSE) Sensex opening a weak note. The Sensex moved in the red for most part of the day, as market participants appeared to have been expecting a correction on the back of large gains on Tuesday and Wednesday. The bellwether index on the BSE which moved within a band of 100 points, finally settled for the day at 9617.74 points, recording a drop of 30.3 points.

Click here for table

The S&P CNX Nifty moving on similar lines reached a high of 2916.2 points in the initial minutes of trading. Succumbing to the correction phase that set in, the index went downhill almost immediately. Recovering a part of the losses the Nifty managed to close at 2899.85 registering a 0.16 per cent decline.

Mid-cap stocks managed to buck the trend that prevailed in the large-cap and small-cap space. While frontline stocks in the IT, technology, FMCG and oil and gas sectors dropped marginally, those in the consumer durables sector took a beating. Healthcare, banking and metal sectors managed to buck the trend.

Media stocks took most of the beating with players in the entertainment space such as Crest Animation, Balaji Telefilms and Adlabs shedding more than a per cent. Mid-Day Multi Media represented the newsprint space. News broadcasters TV Today and NDTV also dropped by more than a per cent. Frontline stocks in the IT space such as HCL Infosystems, Satyam Computers and Wipro also shed more than a per cent. Shyam Telecom was among the prominent gainers in the technology space. Accompanied by a 24-fold rise in volumes, the stock closed with a gain of 10.6 per cent.

Although frontline stocks in the FMCG space shed value, a few stocks in the mid-cap and small cap space registered considerable gains. Godfrey Phillips was among the prominent. The stock, which has been recording gains since the second trading session of the New Year, returned to the Rs 1,500-mark by gaining 5 per cent. Buoyed by positive reports on the oil front Assam Company gained 4.8 per cent, even as many of its peers in the tea sector shed value. Tata Coffee was another prominent gainer in the plantation sector. Intense activity was recorded on its counter, as market participants appeared to have bought on the back of consistent gains in global coffee prices. It closed with a 2.5 per cent gain. Losers in the FMCG space included Liberty Shoes, Crew B.O.S., Satnam Overseas, Ruchi Soya, Warren Tea and Jindal Photo. GTC Industries, which gained about 65 per cent over the previous six trading sessions, dropped 3.7 per cent. However, activity on its counter continued to remain intense.

Widespread buying activity in the banking space helped the BSE Bankex register a gain of 0.8 per cent. Gainers included Indian Overseas Bank, Bank of India, Union Bank, Vijaya Bank, Karnataka Bank, Kotak Mahindra Bank, Allahabad Bank and State Bank of India. UTI Bank and Andhra Bank gained 2.7 and 8.6 per cent respectively following announcements of plans to raise funds.

Prominent gainers among the Nifty constituents were GAIL, Andhra Bank, Punjab National Bank, BPCL, HCL Technologies, ABB and BHEL. Tata Motors, M&M, ICICI Bank, SAIL, HPCL, ITC and Tata Steel featured among the losers.