The Hindu Business Line : Markets fail to hold on to gains on rate hike fears

The markets failed to hold on to the opening gains, as concerns on the interest rate front appear to have overwhelmed participants. For most part of the day, the BSE Sensex moved in the red with the selling pressure coming in the last hour of trade. The Sensex closed for the day a few points above the 14,200 mark. The S&P CNX Nifty also chartered a similar course.

Sector Watch

Bajaj Hindustan was among the top losers in sugar sector. The stock closed lower by 6 per cent after the company reported a 29 per cent dip in earnings. Dwarikesh Sugar fell 1 per cent after the company announced a similar scorecard. The company announced a 44 per cent drop in earnings. Others that took a beating included Balrampur Chini, Triveni Engineering, Rajshree Sugars, Shree Renuka and Mawana Sugars. EID Parry and Bannari Amman were the only ones to buck the slide.

The banking sector oriented index on the BSE shed 7 per cent on concerns of a further hike in reverse repo rates. IndusInd Bank led the declines losing 4 per cent. The company announced a 20 per cent earnings drop. Dhanalakshmi Bank, Bank of Baroda, Bank of Maharashtra, City Union Bank and Corporation Bank shed more than 2 per cent each.

Lakshmi Vilas Bank, Dena Bank, Karnataka Bank and Vijaya Bank were among the prominent ones to buck the trend.

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The metals sector was among the top gainers. The sector oriented index on the BSE gained 1.4 per cent. Aluminium stocks stole the limelight. Hindalco, which on Thursday reported a two-fold rise in earnings, gained 3 per cent. Madras Aluminium also gained 3 per cent while National Aluminium gained 1 per cent.

The steel sector was a mixed bag. Frontline stocks - Tata Steel and SAIL registered moderate gains while second rung stocks such as ISPAT Industries and Essar Steel shed value. Prominent losers in the metals sector included Hindustan Zinc, Shree Precoated and Sterlite Industries.

Led by declines in blue-chip stocks the BSE FMCG index shed 2 per cent. ITC and Godrej Industries topped the losers' list in the index. HLL, Nirma, Dabur and Britannia also figured in the list. Marico, United Spirits and GlaxoSmithKline Consumer were among the few that bucked the trend.

Event-Specific Action

Reports that Himatsingka Seide plans acquire a 70 per cent stake in Giuseppe Bellora, a textile manufacturer in Italy, fuelled the stock to an intra day high of Rs 150. The positive sentiment, however, was short-lived with stock closing at Rs 134.6 about 6 per cent lower.

Jindal Steel & Power gained about 1 per cent after company reported a 50 per cent surge in earnings. SAIL also registered similar on reports of a two-fold rise in earnings.

Other Gainers/Losers

IFCI, LIC Housing Finance, Moser-Baer, IDFC, Polaris, Container Corporation, Lupin and Tata Motors were among the top gainers among the Nifty Junior constituents. Topping the losers' list was TVS Motors, Apollo Tyres, CPCL, Indian Overseas Bank, Bharat Forge and Indian Hotels.