Financial Daily from THE HINDU group of publications
Tuesday, May 23, 2006
Financial Daily from THE HINDU group of publications Tuesday, May 23, 2006 |
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Stock Markets Markets - Stock Markets Vidya Bala
The sector indices on the BSE no doubt suffered the turmoil in tune with the Sensitive index. While a number of indices bore the brunt of the carnage, quite a few managed to contain losses. The BSE Consumer durable index was the worst hit with a decline of 10 per cent. While Videocon Industries and Whirlpool lost about 10 per cent, jewellery stocks Titan and Su-raj Diamonds were drubbed in the broad markets.
Metals lose sheen
Metal stocks continued to tumble on the back of fears that commodities may be nearing the top of cycle. The BSE Metal index slipped by 7 per cent on close of Monday's trade. On May 18, the Lisbon-based International Copper Study Group said that demand for copper had fallen in the first two months of 2006, creating a production surplus. During the above period Chinese demand declined by 5.2 per cent. Sterlite Industries and Hindalco, which together carried a weight of 13 per cent in the BSE Metal index lost heavily. Hindustan Zinc was, however, the biggest drag on the metal index. With a weight of 26 per cent the stock plummeted to Rs 633 - a decline of 20 per cent.
Mounting pressure
The capital goods index was also among the top losers. Stretched valuations may have triggered sharp corrections witnessed in stocks such as Alstom Projects, Siemens, ABB, Aban Loyd Chiles and Thermax. A number of other engineering stocks that peaked the recent rally on the back of increased capital expenditure spending in the country have started witnessing pressure on valuations since last week. Banking and pharma sectors, which largely stayed out of rallies earlier, contained losses with a decline of 2-3 per cent. Frontline stock ICICI Bank fell less than 1 per cent. Supported by strong performance Cipla managed to close in the green, while Ranbaxy stayed flat after being beaten down even before the bear sentiment began. Aided by strong commercial vehicle sales, Ashok Leyland and Tata Motors made an admirable recovery of 25 and 15 per cent, respectively, from their day's low. Bajaj Auto contained losses to 2.5 per cent after last week's announcements of solid corporate results.
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