MUMBAI, March 3: It was back to square one on Tuesday, as the market plunged on the receding chances of a stable government (read BJP) coming to power. The lack of clarity on the political front led to aggressive selling by institutional investors leading to a free-fall in the Sensex by 126.61 points, which in the process went below the crucial 3,700-points benchmark to close at 3,646. Even though the market opened at Monday's close, it nosedived to an intra-day low of 3,600.06 points - a fall of 172 points.The Nifty, too, fell on its last day of the trading cycle. It closed at 1,063.50 points - down 34.70 points over Monday's close. The NSE midcap index, however, plunged to touch a low of 1,201, registering a huge loss of 62.05 points.
The turnover at both BSE and NSE remained high. The BSE registered a record turnover of Rs 1,598.58 crore while the NSE witnessed volumes of Rs 2,319.65 crore. "There is a nasty fear of history repeating itself. Stability seems to be a distant dream," said a BSEbroker.
Rumours of Himalayan Fund (Canbank offshore fund) pressing huge sales of over 10 lakh shares at the ITC counter took the market by surprise. According to market sources, a single-sale trade at the ITC counter on the NSE, ten minutes before close, not only bridged the Rs 5 gap, which existed between the two exchanges, but also brought down the stock from a high of Rs 720 to close at Rs 692.25. However, on the NSE, the stock closed at Rs 706.90, setting a record volume of Rs 1,259 crore.
Besides the Himalayan Fund of Canbank, UTI was also rumoured to have pressed huge sales at the counters of ITC, Reckitt & Coleman, BHEL, Bajaj Auto, P&G, MTNL, Castrol and HLL.
According to market sources, leading FIs were rumoured to have sold chunks of ICICI, L&T and SBI in the demat segment at a discount of over 2 per cent to its market price in the physical segment. Among the FIIs, market sources attribute huge sales by a group of FIIs led by WI Carr, Allianz Capital and CSFB. Profit-booking was explained asthe prominent reason for the huge sales at the ITC counter at its new 52-week high of Rs 724.50.
However, select FII-buying at the counters of LML, Telco, Bajaj Auto, Reliance and ABB were rumoured during mid-session.
The slow-but-steady entry of the bears caught up pace with about 151 stocks hitting the lower end of their price bands on the NSE. However, stocks of Cochin Refinery, ITC, Pentafour Software, P&G and Raasi Cement continued to rise higher touching their new 52-week highs.
Interestingly, stocks like BHEL and BSES, which had touched the upper end of the price bands on the local bourses, on Monday, fell by 8.31 per cent and 4.48 per cent, respectively. The BSES GDR fell by 7.06 per cent to trade at $19.75, as per the mid-day prices collated by Skindia Finance. The GDR of Indian Aluminium fell sharply by over 15 per cent to trade at $2.75 even though its underlying share price recovered by 1 per cent to close at Rs 116.50. Reliance was traded at $8.15, registering a net loss of 9.44 per cent.At the local markets, the stock closed at Rs 161.50 recording a fall of 3 per cent over Monday's close. Though BSES and L&T have been projected by leading FIIs as stocks representing turnaround industries, the GDRs continued to be hammered down with Larsen trading at $4.72.
Kerb up as punters square off position
The kerb market was up in late evening trades as punters were trying to square off their positions. At 8 pm, key pivotals were trading marginally higher than their closing prices. ITC was traded at Rs 690-706 against its official close of Rs 692.25.
The higher prices were attributed to the short position of over 6 lakh ITC shares at the kerb. SBI was traded at Rs 265.50 (Rs 262.50), Reliance was quoted at Rs 164 (Rs 161.50) and Tata Tea at Rs 435.50 (Rs 430.50).
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
