Business Today

Sensex slides 287 points on sell-off

Despite opening on a handsome note, gaining 60 points, the 30-share BSE benchmark plummeted 286.62 points, or 1.37 per cent, to settle the day at 20,589.09.

twitter-logo PTI   Mumbai     Last Updated: November 11, 2010  | 16:58 IST

The stock market on Thursday recorded its biggest decline in about a month, with a 287 points fall in the Sensex, on heavy-selling in blue chips like Reliance Industries, Bharti Airtel and DLF, along with negative cues from South Korea and Europe.

Selling pressure intensified in late afternoon trade, as reports trickled in about fall on South Korean bourses due to large-scale foreign fund selling, which is being attributed to failure of US President Barack Obama and his Korean counterpart to reach a free-trade accord.

Despite opening on a handsome note, the 30-share sensitive index corrected by 286.62 points, or 1.37 per cent, to settle the day at 20,589.09. On October 15, the barometer had tumbled 372 points.

Similarly, the National Stock Exchange's wide-based Nifty tanked by 81.45 points to finish at 6,194.25.

Analysts attributed the bearish sentiment to the lack of fresh buying in the market and the negative global cues.

"Tight liquidity in the market due to the continuous follow-on public offers (FPOs) and initial public offers (IPOs), coupled with the weak global cues are the major reasons for the market correction," Networth Stock Broking Head of Institutional Business Prakash Diwan said.

Continuing southward journey for the third straight session, shares of the country's most-valued firm Reliance Industries plunged 1.85 per cent to close at Rs 1,082.05. The scrip has shed 2.69 per cent in three trading days.

Poor performance by the blue chips, including DLF and Bharti Airtel, also contributed to weakness on the Dalal Street.

Realty giant DLF emerged as the worst Sensex performer after posting a 5 per cent dip in its second quarter profit.

The scrip fell 4.41 per cent and JP Associates, too, slid 3.28 per cent, dragging the BSE-Realty index down 120 points.

"Profit booking across the counters and the lack of some major trigger is drifting the broader market," Geojit BNP Paribas Financial Services Research Head Alex Mathews said.

All 13 sectoral indices closed in the red with realty losing the most.

Similarly, telecom leader Bharti Airtel continued to fall after having reported dip in second quarter numbers on Wednesday. The scrip on Thursday shed 3.26 per cent to close at Rs 317.45.

Among the 30 Sensex scrips, 25 ended the day in red, while only five managed to finish on a positive note.

The losses in the market were primarily offset by the gains in Hindalco(2.65 per cent), Mahindra & Mahindra (1 per cent) and Tata Power (1.47 per cent). The aluminium producer Hindalco erased its Wednesday's losses, becoming the best Sensex performer.

Besides, Reliance Infra and Hero Honda went up by 1.16 per cent and 0.02 per cent, respectively.

Also, IT and banking stocks remained under pressure with the software major TCS losing 2.5 per cent and bellwether Infosys down 0.92 per cent. Private sector lender ICICI Bank and the mortgage lender HDFC declined 1.32 per cent and 1.76 per cent, respectively.

"IT stocks are under pressure primarily due to the weakness in the dollar against rupee," Diwan added.

Meanwhile, Asian stock markets ended mixed on Thursday, with China's benchmark Shanghai Index up 1.04 per cent and Japan's Nikkei Index up by 0.31 per cent, while South Korea's Kospi lost 2.76 per cent. Europe was trading weak in afternoon trade.

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