The Sensex gave away another 67 points on Wednesday to close further down at 3209.55. ITC contributed majorly for the downturn, whereas SBI and Reliance Industries gave away comparatively much less.The market opened on a weak note with the Sensex at 3272.74, which was lower than the previous close of 3276.21. But interestingly the market moved up. Wednesday being the first day of the NSE week, this set in hopes for a market revival. But that was short lived.
The Sensex no doubt rose to 3301 gaining 29 points over the opening, but that was not sustained. The high for the day was midway through the previous day's range. The previous high was at 3355.22. On sustained selling pressure, the index moved down to post a low of 3200.83. There was a marginal recovery from this low, when the market closed with the Sensex at 3209.55.
The market behaviour cannot be categorised as hopeless. This is because the Sensex's movement was not one of starting at Tuesday's close and moving down further. The index moved intoTuesday's territory, though it closed lower.
The Sensex has clearly moved into the oversold territory. Therefore its scope for going down further would get further restricted. This is also supported by the behaviour of some of the pivotal scrips.
SBI moved down from Rs.239 to Rs 235.25 losing just Rs 4. Possibly it could go down right upto Rs 229. But on the other hand the momentum of fall has slowed down. And in it lies the hope that the scrip and the market indirectly has a fighting chance to slowdown the Sensex slip. Reliance Industries closed at Rs 148 with a volume of 52 crore shares. Yes, it can move down to Rs 144, but when that happens, there is a good chance that buyers will emerge.
Same can be said of ITC if it slides down another Rs 15. Tisco and ACC have lost only marginally.
On the other hand BHEL has lost 7.25 per cent and HPCL 6.03 per cent. But MTNL lost just Rs 1.50. It moved down from Rs 214.50 to Rs 213.
Telco similarly lost only marginally. The momentum of loss is slowing in anumber of cases and that should put the bears on guard. Quite likely short covering could be round the corner any minute now.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
