The Hindu Business Line : Selling pressure drags Sensex down

MARKETS failed to sustain the gains recorded on Thursday as selling pressure dragged the indices down in the negative territory. The Sensex plunged by 115.4 points at its close of 9,256.9,while the Nifty was down by 30.4 points. The latter closed at 2,804.9.

The Sensex opened firm at 9,417.3 as against its previous close of 9,372.3 and shot up to a high of 9,442.9 in just ten minutes. It, however, went on a tailspin during mid-session as foreign funds and other market players resorted to a fresh bout of selling, pulling down the benchmark index to an intra-day low of 9,237.9.

The broader Nifty also moved in sync with Sensex and closed at 2,804.9 down by 1.1 per cent.

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Profit-booking in frontline counters was instrumental in pulling the indices down. HDFC, which was a significant gainer on Thursday, witnessed a reversal in stock price movement. The stock lost 6.5 per cent at its close of Rs 1,205.3.Other index heavyweights that wilted under selling pressure included the likes of Tata Steel, Reliance, ITC, Grasim, Hindalco, Tata Power, HLL and HDFC Bank among others.

Majority of stocks in the IT space ended weak. Igate Global, Patni Computers, Rolta India, Hexaware, Scandent Solutions and Polaris were prominent losers. Few of those that managed to attract buyers included Allsec Technologies, Sonata Software, Four Soft, Mastek and Aptech among others. Following news reports that it agreed to buy Mpower and its southern India-based unit, Mpact Technology Services, the stock of Wipro added Rs 4.5,or 0.9 per cent.

FMCG sector stocks sported a disappointed look. Champagne India was a prominent loser, closely followed by Harrison Malayalam, Nestle, Mcdowell, Bata and Godfrey Philips among others. Fresh buying support across the counters of Marico, Dabur India, GTC Industries, Tata Tea and United Breweries helped them end in positive territory.

On a day characterised by widespread bearish sentiment, sugar stocks had a fine outing. KM Sugar Mills was a major gainer whose stock flared by 15.4 per cent. Ponni Sugars and Rajshree Sugars also ended with sweet doses of gains.

Metals stock took a severe beating and languished in the red. Mirroring the losses in these stocks, the BSE METAL index underperformed other sectoral indices. While Tata Steel, Hindalco, SAIL, Monnet Ispat, Jindal Stainless, Jindal Saw, Essar Steel and Navbharat Ferro Alloys suffered sharp losses. Vesuvius, Sesa Goa and Maharastra Seamless, however, managed to escape the bearish onslaught.

Although bearish sentiment was widespread, it was relatively less pronounced in the mid-cap and small-cap spaces. Stocks of Television Eighteen, Usha Martin, Indiabulls, Bajaj Hindustan, Shoppers' Stop, Praj Industries, Venus Remedies, NDTV, and Tata Investment Corp exhibited considerable weakness. Few of those that made a mark on the market included India Infoline, Hindustan Construction, Pfizer, Bharati Shipyard, Pidlite Industries and National Fertilizers among others.

Banking stocks also stayed out of favour. Barring exception of few stocks such as ICICI Bank, Vijaya Bank, Oriental Bank and UTI Bank, majority of the stocks lost steam.

Following an announcement that the sugarmaker has effected a sale of shares through GDRs, the stock of Dwarikesh Sugar climbed 2.4 per cent.

After being battered down in the past few sessions by the outcome of Lipitor patent challenge case, the stock of Ranbaxy had a little respite. It gained 0.2 per cent on the back of an announcement of an agreement with Cephalon to keep a generic version of the sleep-disorder drug off the market till 2011.

Tata Chemicals rose by or one per cent to Rs 221.85 after the local maker of caustic soda and fertilisers said it bought 63.5 per cent of UK-based Brunner Mond Group for Rs 508 cr.

Other notable losers on the Nifty included the likes of Aegis Logistics, Arvind Mills, Mahavir Spinning, PBA Infrastructure, Alstom Projects, VSNL and Madhucon Projects.