It did almost seem too good to be true and that thought was confirmed by today’s selloff in late afternoon trade. The Indian equity indices were dull in trade for most of the day after a positive opening but succumbed to profit booking in the late afternoon session after seven weeks of gains.
Markets were further pressured by European indices which gave up their early gains. Asians ended slightly up, led by Japan which closed up 1% on the back of a weak yen.
BSE Sensex: 18,145 down 1.5%
NSE Nifty: 5,505 down 1.8%
Sectoral indices were a sea of red led by the Realty index, which lost a whopping 6.7%. It was followed by the Consumer Durables index which was down 5%, while the BSE Metals and the BSE Banking index lost 4.2% and 3.2% respectively.
The BSE Mid-Cap index and the BSE Small-Cap index lost ~3.4% and 3.2% respectively.
Top declining stocks on the Sensex and the Nifty were RCOM, SBI, DLF, Sterlite Industries, Axis Bank, JP Associates, Jindal Steel, Hindalco Industries, Tata Steel, tata Power, BHEL, ICICI Bank and Bharti Airtel.
Notable gainers were few on both the indices which were Sun Pharma, ITC, TCS, ONGC, Infosys.
State Bank of India shares slipped 7.9% and ended at Rs.2257.80 on speculation that the bank would fund troubled carrier Kingfisher Airlines. Kotak Securities has downgraded State Bank of India to 'accumulate' from 'buy' as the stock has risen too fast too quick. “Slippages remain at elevated levels run rate of 4% in the last two quarters and was clearly negative in our view,” Kotak Securities said in a note.
Jubilant Life Sciences ended down 1.3% at Rs.190.90 in a weak market. Shares initially climbed to Rs.211 after the company announced that its subsidiary, Jubilant HollisterStier had won orders worth over $90 million for the manufacture of sterile parenteral products for sale in US and Europe to be delivered over a five-year period.
After rising to Rs.408, Bank of India tanked 7.7% to end at Rs.366 in a bleak market. It had earlier risen on news that it would to raise funds through a preferential issue of up to 70mn shares to the Indian government and the Life Insurance Corporation of India (LIC).
Idea Cellular closed at Rs.90.40, down 2.85%. It had gained earlier in the session after it filed a 'clarificatory application' with the registrar over the cancellation of its licences. The company says that its license applications were unjustly delayed until 2008.After rising to Rs.86, Panacea Biotec ended at Rs.82.90, down 2%. The stock rose following its introduction of Polprotec in Nigeria.
Rain Commodities touched a day’s high of Rs.41.80 after its 4Q profit rose 4 times on year to Rs.1.8bn. However, the stock declined 2.1% to end at Rs.37.35 due to weakness in the markets.
Reliance Industries ended down 1% at Rs.833.20 triggered by weakness in the market. The stock had earlier risen as the company said it saw sales to the tune of $700mn from its venture with Russia’s Sibur in its first year. Reliance will start the butyl plant in the second half 2014, its executive direct, Nikhil Meswani said.
Sesa Goa lost 4.2% and closed at Rs.236.40 on news of the company being denied a tax deduction of Rs 243 crores. On Tuesday, media reports stated that parent company Vedanta may merge Sterlite Industries and Sesa Goa in a share swap deal in order to simplify the corporate structure. Sterlite Industries ended at Rs.119.90, down 6.6%.
After rising earlier in the session on reports that the company was to double spending on its luxury brand Jaguar, Tata Motors finally closed down 1.3% at Rs.267.75 triggered by a fall in the markets in the afternoon session.
Denso India declined 4.1% to Rs.54.20 after ~1.1% of equity was transacted in a single deal on NSE.
Dhanlaxmi Bank lost 5.2% to close at Rs.61.75 after credit-rating agency Fitch cut its rating on the bank to BBB- from BBB.
All eyes will be tuned in to the F&O expiry on Thursday.