The stock market continued to reel on Tuesday with investor sentiment spooked by the freight hike in the Railway Budget and the fractured political mandate in Italy that had led to a sell-off across the globe

Widening early losses, the Sensex lost 316.55 points to end the day at a three-month low of 19,015.14, wiping out over Rs 1 lakh crore of wealth. The decline was sharp in railway equipment manufacturers such as Kalindee Rail Nirman and Titagarh Wagons, which fell by 8-12 per cent.

The 50-stock Nifty closed at 5761, down 93 points. For the BSE Sensex, today’s close is its lowest since November 27, 2012. Intra-day, the Sensex dipped briefly below the 19,000 level to hit a low of 18,976.94.

The carnage in the mid-cap space continued with many scrips with relatively higher speculative interest taking a knock.

“We expect the equity market to remain volatile with negative bias in the next couple of days and eventually stabilise at lower levels during the coming week. Markets tend to be volatile ahead of the derivatives’ expiry week. February F&O expiry coincides with the announcement of Railway and Union Budgets and rising uncertainties globally, resulting in a sell-off in the equity markets,” said Gaurav Dua, Head of Research at Sharekhan.

All the indices on the NSE (barring CNX IT) and the BSE (barring BSE IT and BSE Teck) closed in the red. Auto, metals, energy, PSU, financial services, realty and pharma scrips were the worst hit.

raghavendrarao.k@thehindu.co.in

(This article was published on February 26, 2013)
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