The Hindu Business Line : A volatile day ends in heavy losses

The benchmark indices Sensex and Nifty — that witnessed a consistent run in the last one week creating new benchmarks — witnessed sharp volatility during the day and finally ended booking heavy losses. The correction occurred after the Sensex gained almost 1000 points in the past one month.

However, there were bright stars too that withstood the bearish sentiment when most stocks were being battered. Stocks such as Bayer ABS, Bharti Tele, Blue Dart, Goodlass Nerolac, Tata Power and VSNL gained despite the heavy bear assault.

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The markets opened on an exuberant mood, as they have been in the past few trading sessions, gaining close to one per cent in the first half of the trading session. However, the blow in the last couple of hours of trading was severe.

Sensex closed below the 6000-mark losing 95.36 points after touching a high of 6121.20 points. It is yet to touch its all-time intra day high of 6150. The Nifty closed 28.3 points lower at 1926.7 points.

Auto and FMCG stocks managed to remain stable. Impressive sales numbers declared for the month of December by a number of auto majors such as Tata Motors, Maruti and Hyundai could have contained the decline in the prices of some of these stocks.

FMCG stocks too remained firm, as they have not participated actively in the rally that spread across a swathe of stocks across sectors.

Oil stocks such as ONGC and GAIL, which ran up quickly gaining more than 20 per cent in a week, started shedding gains on profit booking. The announcement by the Government to open the public issue for the sale of its 10 per cent stake in these companies by March 10 could renew interest in these stocks.

Aggressive profit booking was witnessed across sectors such as cement, steel, banks and technology. Stocks such as Gujarat Ambuja, ACC, Shipping Corporation, Infosys, Reliance, ITC and Tata Steel witnessed heavy profit booking. Stocks from a few sectors such as engineering, telecom and power were almost insulated from the widespread downfall.

Engineering stocks such as Crompton Greaves, BHEL, Thermax and Alfa Laval were not as much affected by the downfall as stocks in other sectors. Both L&T and Thermax have bagged fresh orders to the tune of Rs 135 crore and 74 crore, respectively in the last couple of days.

Power stocks such as Tata Power, CESC and Ahmedabad Electricity were upbeat while BSES closed just a notch lower at Rs 512 losing Rs 1.15 during the day. CESC was among the top gainers moving up by 10 per cent. Tata Power gained 4 per cent to close at 351.95.

Among the telecom stocks, front-rung stocks such as Bharti Tele-Ventures, VSNL and Tata Telecom ruled firm, while Tata Teleservices declined.

The top gainers for the day were Today's Writing and Madras Fertilisers. The top losers were HMT, Hindustan Organic Chemicals, Indraprastha Gas and DSQ Software.

Gammon India, National Organic Chemicals, Spanco Telesystems, Dagger-Forst, Sri Adhikaro Brothers, Pantaloon Retailing, Hikal, BPCL, Dalmia Cements, Rashtriya Chemicals, BSEL Infrastructure, Aegis Logistics and Chemplast Sanmar witnessed heavy buying.

Traded volumes spurted sharply in these counters accompanied by a spike in their share prices. IFCI closed up 4.75 per cent at Rs 17.65. Traded volumes supported with a five-fold rise. Crisil gained marginally after it announced that it would be taking a 12.1 per cent equity stake in the National Commodities Exchange.