The Hindu Business Line : Weak Asian sentiment drags down bourses

Continuing in Tuesday's pattern, the markets opened on a strong note on Wednesday, but the opening gains were short-lived as weak sentiment in the major Asian markets dampened interest among market participants.

With indecision prevailing in the market, the Sensex and Nifty moved flat until the later hours, when selling pressure set in.

The Sensex and the Nifty closed lower by about 0.8 per cent as bears wielded the upper hand towards close. The domestic markets were among the top losers in the Asian region.

Buzzing Stocks

Paper stocks such as Malu Paper Mills, Star Paper Mills and Seshasayee Paper gained sharply by strong volumes. Others that attracted interest included Balmer Lawrie and Allcargo Logistics.

Sector Watch

Metal stocks closed on a weak note, with the sector-oriented index on the BSE dropping by about 1.6 per cent. Midcap and small cap stocks in this space took most of the beating.

Kirloskar Ferrous, Kalyani Steel, Raipur Alloys, Jindal Saw, Gujarat Mineral Development Corporation and Gujarat NRE Coke were among the prominent losers in this space. Notable stocks that bucked the trend included Welspun Gujarat, Ferro Alloys and Binani Industries.

The auto sector was the other major loser with only five of the 22 constituents of the BSE Auto index closing in the green.

Tyre manufacturers Goodyear and Apollo Tyres were among the major losers in this space. Auto component manufacturers such as Rane Madras, RK Forgings, ZF Steering, Shanthi Gears, Amtek and Bharat Forge dipped sharply. Balkrishna Industries bucked the trend that prevailed in the tyre space by registering seven per cent gain.

Event-specific action

Sundram Fasteners attracted significant buying activity as bulls appeared to have sprawled themselves across its counter. A 1:1 bonus announcement triggered interest in the stock. Supported a by a spurt in volumes the stock registered 7.5 per cent gain.

Accompanied by a six-fold rise in volumes, Oudh Sugar gained about three per cent. Buying interest appears to have set in after the company said that it plans to expand its crushing and co-generation plant capacities at a cost of Rs 337 crore.

JSW Steel extended its gaining streak into the third day. The stock closed with two per cent gain after the company announced its acquisition of coalmines in Mozambique.

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L&T's announcement that it had bagged an order worth Rs 380 crore from NTPC failed to impress. Reflecting the sentiment that prevailed in the large cap space, the stock shed 1.4 per cent on lower volumes.

Dishman Pharmaceuticals was yet another stock that gained on positive announcements. The stock supported by a spurt in volumes gained about two per cent after the company announced that it had acquired Carbogen Amcis of Switzerland from Solutia Europe.

Other Gainers and Losers

Notable gainers included Mid-Day Multimedia, Shringar Cinema, Balaji Telefilms, SSI, Sri Adhikari Brothers, Infotech Enterprises and Sterlite Optical. Bombay Dyeing, TVS Motors, LML, Syndicate Bank, Indian Overseas Bank and UCO Bank were among the prominent losers.