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Fears of US retaliation shells Sensex

Krishnan Thiagarajan

FEARS of a retaliatory action by the US against Afghanistan and its spiralling impact sent the BSE Sensex into a tailspin, the index declining by 5.27 per cent or 149.14 points during the day.

The BSE Sensex closed at 2680.98, recovering from a low of 2640.58 points. In closing at 2680.98 points, the Sensex closed marginally higher than the low touched by it in November 1993. It opened for the day at 2758.16 points which was also the day's hig h. The markets suffered a bloodbath as only 154 stocks advanced in value while 1,016 stocks logged declines. The turnover at the Bombay Stock Exchange slipped from Rs 1,222.74 crore on Friday to Rs 960.31 crore during the day.

The S&P CNX Nifty also suffered the same fate, declining by 47.45 points to settle at 872.25 points. The broadbased and composite BL-250 index declined by 6.2 per cent or 52.10 points to close at 787.40. The market capitalisation of the BL-250 index dipp ed by Rs 21,448 crore to settle at Rs 3,23,823.20 crore. All the sectoral indices ended in negative territory, with the Technology indices leading the pack with a 11 per cent decline and Agri Business index, an 8 per cent decline and the PSU Index with a 6.7 per cent decline.

Among the industrial indices, which were in negative territory were computer hardware and office equipment - 13.4 per cent, steel products - 13.3 per cent, computer software - 10.5 per cent, diversified - 10.8 per cent.

In a day in which stocks were devastated by apprehensions of an uncertain financial, economic and political environment, there were hardly any good stocks which ended in the positive territory.

Among the few that did were Chemplast Sanmar, International Best Foods, Sundaram Clayton, Nestle and Forbes Gokak with slender trading volumes.

The Chemplast Sanmar stock appreciated by Rs 1.10 or 6.39 per cent to close at Rs 18.30. Trading volumes, however, dropped to 6,420 shares (81,819) during the day. The movement in the stock has to be seen in the context of the buyback offer proposed by t he company.

The Nestle stock was another gainer during the day, with the stock appreciating by Rs 10.80 or 2.08 per cent to end at Rs 529.55. The stock witnessed heightened activity, with the trading volumes surging from 78,716 shares on Friday to 8.99 lakh shares d uring the day.

Almost all the Sensex and Nifty heavyweights ended in the negative territory. Among the significant losers during the day were Hughes Software Systems, Moser Baer, CMC, Polaris Software, Global TeleSystems, Jain Studios, Shree Cements and Pentamedia Grap hics.

The Hughes Software stock declined by Rs 74.60 or 19.98 per cent to settle for the day at Rs 298.65. The trading volumes dipped from 2.70 lakh shares on Friday to 41,981 shares during the day's trading. The dip has to be seen in the wake of the sharp cut in the income growth forecast for 2001-02 to 25-35 per cent from 55-60 per cent. The sharp drop must also be seen in the light of the drop in telecom spending across the globe and the possibility of further spending declines in the wake of the attacks a t the World Trade Centre and Pentagon.

The Moser Baer stock shed Rs 44.20 or 19.99 per cent to close at Rs 176.90. Trading volumes surged to 1.81 lakh shares (47,267).

The CMC stock declined by Rs 49.80 or 19.98 per cent to settle at Rs 199.40. Trading volumes surged to 45,851 (15,378).

The Polaris Software stock dipped by Rs 15.60 or 19.96 per cent to close at Rs 62.55. Trading volumes dipped from 1.81 lakh shares on Friday to 70,906 shares during the day's trading.