Post-Market Commentary , Monday, June 30, 2008

Sensex ends down 341pts; Rel Infra slumps 11%

The market extended losses for the second successive day today, with Sensex shaving off nearly 1000 points in last two tradng sessions as high inflation, rising interest rates, record high oil prices and political concerns continued to haunt the markets. Over the past few days, the market has witnessed a sharp fall with bears totally dominating the proceedings on the street.

The barometer index BSE Sensex today hit its lowest level in more than 14 months. Realty, consumer durables, oil & gas and capital goods stocks fell. The market breadth was weak.

Political uncertainty weighted on market sentiments. The media continues to speculate whether the ruling Congress led United Progressive Alliance government will be able to push through a much-debated Indo-US nuclear deal and still retain its power, in the face of heavy opposition from its key communist allies. The Left parties on Sunday, 29 June 2008, renewed their threat to withdraw support from the ruling coalition if Prime Minister Manmohan Singh forged ahead with the nuclear deal.

The uncertainty pertains to whether there will be stability at the centre if mid-term polls are held i.e. whether the new government will complete five years and whether the new government restarts economic reforms process which has virtually come to a halt in the last two years or so.

A sustained selling of Indian stocks by foreign institutional investors (FIIs) has also dented market sentiment. As per provisional data, foreign funds sold shares worth a net Rs 703.11 crore on Friday, 27 June 2008. FII outflow in June 2008 totaled Rs 9349 crore (till 26 June 2008). FII outflow in calendar year 2008 totaled Rs 24,719.10 crore (till 26 June 2008).

The 30-share BSE Sensex plunged 340.62 points or 2.47% at 13,461.60. Sensex lost 396.68 points at day’s low of 13,405.54, its lowest level in more than 14 months.

S&P CNX Nifty was down 96.1 points or 2.32% at 4,040.55.

As per the provisional figures on NSE, foreign institutional investors sold shares worth Rs 208.66 crore today, 30 June 2008 while domestic funds bought shares worth Rs 724.18 crore.

Anil Dhirubhai Ambani group stocks tumbled. Reliance stocks slumped. Reliance Infrastructure lost 11.47% to Rs 784.80 and Reliance Communications shed 6.58% to Rs 442.40.

INDEX SHAKERS...

Reliance Infrastructure slumped 11.5% to Rs 785. ACC tumbled nearly 10% to Rs 523.

Ambuja Cements plunged nearly 7% to Rs 76. Grasim, DLF and Reliance Communications shed around 6.5% each at Rs 1,815, Rs 396 and Rs 442, respectively.

Tata Motors and Mahindra & Mahindra dropped 5% each to Rs 426 and Rs 485, respectively.

HDFC slipped 4.5% to Rs 1,962. Maruti, Reliance and SBI declined over 4% each to Rs 618, Rs 2,093 and Rs 1,111, respectively.

Larsen & Toubro dropped 3.7% to Rs 2,183. ICICI Bank and Bharti Airtel were down around 3.5% each at Rs 630 and Rs 722, respectively.

...AND THE MOVERS

Hindalco gained 2% at Rs 142.

ITC and Infosys advanced over 1.5% each to Rs 187 and Rs 1,735, respectively.

VALUE & VOLUME TOPPERS

Reliance topped the value chart with a turnover of Rs 380 crore followed by Reliance Petroleum (Rs 262.70 crore), Reliance Capital (Rs 243.65 crore), debutant MVL (Rs 211 crore) and Niraj Cement (Rs 148 crore).

Debutant MVL led the volume chart with trades of around 2.37 crore shares followed by Reliance Petroleum (1.51 crore), Reliance Natural Resources (1.45 crore), Chambal Fertilisers and Chemicals (84.60 lakh) and IFCI (81.65 lakh).