Post-Market Commentary , Monday, July 07, 2008

Late sell-off in RIL weighs on market

The Sensex opened with a positive gap of 108 points at 13,562. Renewed buying interest in banking and infrastructure stocks led the index rally to a high of 13,793.

The market lost most of its gains in late trade ending marginally higher after reports filtered in that India's Defence Attache Brigadier R D Mehta and three other Indians among forty-one people were killed in a suicide attack on the Indian Embassy in Kabul today. A sharp slump in prices of Reliance Industries (RIL), Reliance Communications, Reliance Infrastructure, Larsen & Toubro, and Bharat Heavy Electricals caused the late slide on the bourses. The market had remained firm in most part of the day on firm global cues and due to easing of political uncertainty.

IT, FMCG stocks gained whereas oil & gas and capital goods stocks fell. The market breadth was strong with small-cap and mid-cap shares staging a comeback after a sharp recent plunge.

Poitical worries receded with Samajwadi Party (SP), a regional party, on making it clear during the week end that it will support the Congress-led United Progressive Alliance (UPA), at a time when Left parties are on the verge of withdrawing support. The Left front has set 7 July 2008 as deadline for the government to let them know whether it intends to approach the International Atomic Energy Agency to seal the India-specific safeguards agreement.

The 30-share BSE Sensex rose 71.99 points or 0.54% at 13,525.99.

S&P CNX Nifty gained 14 points or 0.35% at 4,030.

As per the provisional figures on NSE, the foreign institutional investors (FII)'s sold shares worth Rs 439.57 crore,while domestic funds bought shares worth Rs 75.9 crore today, 7 July 2008.