Flight of capital fears! Sensex crashes over 600 points

India Infoline News Service | Mumbai | March 09, 2015 16:21 IST

Amar Ambani, Head of Research at IIFL said, "After hitting fresh peak in the previous week, Nifty struggled to sustain at the top and has in fact corrected meaningfully. Having said that, we expect the current weakness to continue in the short term as the index has failed to hold above the rising trendline support placed around 8,780. Corporates especially the IT pack seems to be suffering from growth pangs as is evident from TCS and Mindtree’s recent commentary. The positive stance for Nifty would only be reaffirmed with a move above 9,000. The US retail sales, India's IIP and inflation numbers to be announced later this Thursday would be in focus."

A sea of red engulfed global markets including India as markets seemed to be waiting for an excuse to crash. The reasons may not be many but a couple of them hold water for now. The strengthening of the dollar was one; the rupee saw some weakness since early trade today. A stronger-than-expected US jobs data sparked fears that the rate hike in the US could come in faster than anticipated.
 
Unabated selling pressure in banking, infrastructure, IT and metal shares saw the BSE index tumble below the 29,000-mark intra-day. The BSE index touched a low of 28,800, and finally ended with a deep cut of 2 per cent (604 points) at 28,845.
 
Amar Ambani, Head of Research at IIFL said, "After hitting fresh peak in the previous week, Nifty struggled to sustain at the top and has in fact corrected meaningfully. Having said that, we expect the current weakness to continue in the short term as the index has failed to hold above the rising trendline support placed around 8,780. Corporates especially the IT pack seems to be suffering from growth pangs as is evident from TCS and Mindtree’s recent commentary. The positive stance for Nifty would only be reaffirmed with a move above 9,000. The US retail sales, India's IIP and inflation numbers to be announced later this Thursday would be in focus."
 
The NSE Nifty opened gap-down 47 points lower at 8,891, and after struggling around the 8,800-level in the morning session, slumped to a low of 8,740 towards the end. The Nifty finally ended with a huge loss of 2 per cent (181 points) at 8,757.
 
Among the index heavyweights, ICICI Bank alone accounted for a loss of 102 points on the Sensex and 25 points on the Nifty.
 
The broader market also ended with significant losses. The CNX Midcap and the Smallcap indices were down 1.3 per cent each at 13,175 and 5,758, respectively.
 
The India VIX (Volatility) index rose 9.5 per cent to 15.8125.
 
The breadth was extremely bearish, with more than two declining stocks for every advancing share. Out of 1,705 stocks traded on the NSE, 1,049 declined and 451 advanced today.
 
Among sectors, the Bank Nifty and the CNX Infra index tumbled over 3 per cent each to 19,145 and 3,245, respectively. The Realty index plunged 2.8 per cent to 227.60. The Metal index shed 2.5 per cent at 2,414, and the IT index dropped almost 2 per cent to 12,422. The CNX Pharma index, however, managed to hold on to a 0.4 per cent gain at 12,677.
 
Metal majors - Sesa Sterlite and Hindalco were the biggest percentage losers in the Nifty-50 space, down over 5 percent each at Rs. 198 and Rs. 141, respectively. 
 
Axis Bank, ICICI Bank and Gail India shed 4.3 per cent each at Rs. 590, Rs. 333 and Rs. 386, respectively.
 
NTPC also slumped over 4 per cent to Rs. 152. BHEL, UltraTech Cement and Larsen & Toubro were the other major losers, down nearly 4 per cent each.
 
Tata Power, Ambuja Cements, IDFC, Kotak Bank and DLF also finished with losses of over 3 per cent each.
 
TCS shed 2 per cent at Rs. 2,644 on reports that the company expects Q4 revenue to be in line with the last year's trend.
 
HCL Technologies plunged over 4 per cent in opening trades, after over 5.5 million shares changed hands in five block deals on the BSE this morning around Rs. 1,980-odd levels. The stock finally ended 0.5 per cent lower at Rs. 2,056.
 
Jindal Steel & Power soared to a high of Rs. 201 in early morning deals on winning the Tara block in Chhattisgarh for Rs 2,103 crore, with a bid at Rs. 126 per tonne. The stock finally ended 4.5 per cent higher at Rs. 194, and was the biggest out-performer in the Nifty-50 stocks.
 
Hindustan Unilever too traded on a firm note, and gained as much as 3.5 per cent at Rs. 972. Lupin added 1.7 per cent to Rs. 1,870.
 
Sun Pharma ended 0.6 per cent higher at Rs. 1,044 on reports that the High Court of Punjab and Haryana approved the proposed merger of Ranbaxy with itself. Ranbaxy gained a per cent at Rs. 814.
 
Among other stocks - Pipavav Defence and Offshore extended its losses and has now dropped below the open offer price by Reliance Infrastructure. The latter has announced an open offer for acquiring additional 26 per cent stake in the company at Rs. 66 per share. Reliance Infra last week acquired near 18 per cent stake in the company for Rs. 819 crore. Following the 10 per cent lower circuit on Thursday, Pipavav today plunged another 7.3 per cent to Rs. 63.85. Reliance Infrastructure also tanked 4.6 per cent to Rs. 467.
 
Sun Pharma Advanced Research Company (SPARC) extended its winning run for the third straight day after the company received US FDA nod for its anti-epileptic drug. The stock today ended with a gain of 15 per cent at Rs. 545, and has soared over 32 per cent in the last three days.
 
Suven Life Sciences spurted to a high of Rs. 245 in intra-day deals after the company announced that it secured two more patents, one each in Eurasia and Israel corresponding to the New Chemical Entities (NCEs) for the treatment of disorder associated with Neurodegenerative diseases and these patents are valid through 2029 and 2030, respectively. The stock, however, pared gains and eventually settled with a minor gain of 0.5 per cent at Rs. 235.
 
Natco Pharma jumped to a high of Rs. 1,580, and finally ended 2.9 per cent higher at RS. 1,556 on the back of launching its Hepatitis C drug in Nepal.
 
Container Corporation (ConCor) re-tested its all-time high at Rs. 1,650 after the Reserve Bank of India (RBI) notified that FII/NRI/FPI can invest up to 34 per cent of the paid up capital of the company. The stock eventually ended with a solid 7.8 per cent gain at Rs. 1,604.
 
Titagarh Wagons zoomed to a fresh life-time high at Rs. 867 on the back of positive news flow at the counter. The company Thursday announced 1:5 stock split, and plans to raise up to Rs. 250 crore. The stock finally ended with a gain of 12.5 per cent at Rs. 826.
 
Kernex Microsystems was locked at the 5 per cent upper circuit at Rs. 44.45, ahead of its board meeting on 10 March to consider the proposal for sale of selected assets to finance new projects and to provide additional capital to ongoing projects.
 
Nitesh Estates hit the third straight 20 per cent upper limit at Rs. 18.10, and was up 17.5 per cent at Rs. 17.74 at close on reports Goldman Sachs is likely to invest $ 300 million in a joint venture company floated by Nitesh Estates. The stock has galloped by over 70 per cent in the last three days.
 
Punjab Chemicals and Crop Protection skyrocketed to a fresh 52-week high at Rs. 148 after the company forecasted bumper profits in FY16. The company expects to clock a net profit of Rs. 20 crore for FY16 as against the estimates of Rs. 4.50 crore for FY15. The stock finally ended 8.8 per cent higher at Rs. 137.
 
Jayaswal Neco Industries rallied nearly 7 per cent to Rs. 11 on the back of favourable High Court verdict. According to reports, the Delhi High Court ruled in favour of the company, entitling it to participate in the auction for a coal block in Chhattisgarh, as a technically qualified bidder.
 
8K Miles Software Services surged over 6 per cent to a high of Rs. 766 on reports that the company's US arm acquired assets of Canadian-based co Mindprint Inc. The stock, however, eventually marginally in red at Rs. 718.
 
A total of 59 stocks registered a fresh 52-week high today. Prominent among these were Aarti Industries, Aegis Logistics, Ambika Cotton, Bombay Burmah Trading, Bliss GVS Pharma, Colgate Palmolive, Container Corporation of India, Dabur India, Eros International, Eveready Industries, Glenmark Pharma, HCL Technologies, Hindustan Unilever, Indoco Remedies, KNR Constructions, Lupin, Mastek, Maxwell Industries, MM Forgings, Motherson Sumi, Murudeshwar Ceramics, Orient Bell, Page Industries, PC Jeweller, Pioneer Distilleries, Punjab Chemicals, Ranbaxy Laboratories, Sadbhav Engineering, Shasun Pharma, Siti Cable, SML Issuzu, SPARC, Sun Pharma, Technofab Engineering, Titagarh Wagons, Uniply Industries, Williamson Magor and Wockhardt.
 
Thirty-five stocks touched a fresh 52-week low, the list included stocks like Amtek India, Autoline Industries, Educomp Solutions, Globus Spirits, GRP, Linc Pen, Menon Bearings, The Oudh Sugar Mills, Plethico Pharma, Precot Meridian, Premier, Rajvir Industries, Reliance Communications, Shree Ganesh Jewellery House, Tara Jewels, Uttam Galva Steels and Vishnu Chemicals.

 

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