The market which was steeped in the red for a major part of the trading session, underwent a solid intra-day reversal in last minute trading. The Sensex surged to 13,463.06, on the back of strong support from buyers. It had earlier tanked to 13,200.36, under severe selling pressure.
Technology stocks, along with Bharti Airtel and a couple of other blue-chips, aided the remarkable bounce back.
The Sensex finally settled 1.23 points, higher, at 13,430.71. It had opened weak, at 13,390.95, and started declining since. It oscillated 246 odd points for the day.
A weakness in Indian ADRs on Friday and mostly subdued Asian markets were responsible for the sell-off on the domestic bourses. Also the Reserve Bank of India (RBI's)'s draft circular prescribing tighter guidelines for banks’ capital market exposure also contributed to the fall. Reports suggest banks will have to retrieve Rs 9,000 crore offered to stock brokers as loans.
The market-breadth, which was highly bearish since the opening, kept on recovering throughout the day, but still ended negative. On BSE 1,530 shares declined, against 943 that advanced. As many as 64 shares were unchanged.
The total turnover on BSE amounted to Rs 4,242 crore.
Among the 30-Sensex pack, 19 declined while the rest moved higher.
Telecom services provider Bharti Airtel was the top gainer, up 6.10% to Rs 616.55, on a volume of 3.49 lakh shares. It had surged to a high of Rs 617 in finishing trade. The index pivotal also recovered from the day’s low of Rs 571.10.
Housing finance major HDFC advanced 3.51% to Rs 1,664, on a volume of 1.67 lakh shares. It had moved in a broad range of Rs 1,587 – Rs 1,701.
Frontline IT stocks advanced on renewed buying. Infosys (up 3.24% to Rs 2,257), TCS (up 2.07% to Rs 1,115), Wirpo (up 1.31% to Rs 556.50) and Satyam Computers (up 1.96% to Rs 442) advanced.
India’s largest cement manufacturer, ACC, was the top loser, down 4% to Rs 1,053, after RBI restricted further FII purchases in the scrip as foreign holding had crossed the 22% ceiling.
Index heavyweight Reliance Industries (RIL) rose 0.38%, at Rs 1,264, on a volume of 7.97 lakh shares. The stock recovered from a low of Rs 1,236.50, after the company said that it expects a fire-damaged hydrotreater unit at its refinery in Gujarat to restart operations within a few days.
Tata Steel fell 2.70% to Rs 463.10, after its offer to buy Anglo-Dutch steel-maker Corus Group was topped by Brazil's Companhia Siderurgica Nacional (CSN). CSN has offered to pay 475 pence a share, 20 pence higher than Tata Steel, to Corus shareholders.
The Nikkei share average dropped to its lowest in a week on Monday, slipping 2.27% as technology stocks followed their US counterparts lower and investors sold Mitsubishi UFJ Financial Group and other major banks ahead of their earnings results. The Japanese Nikkei 225 index slipped 365.79 points, to 15,725.94.
The Hang Seng index lost 228.08 points (1.19%), to 18,954.63.
All European markets were trading with losses.
In a draft circular issued late on Friday, the central bank has restricted banks’ lending to a single borrower for subscribing to IPOs, to Rs 10 lakh. Advances other than IPOs to any borrower against security held in the physical and demat form, have been restricted to Rs 10 lakh and Rs 20 lakh respectively.
RBI has also stipulated a uniform margin of 50% on financing of all IPOs/issue of guarantees for capital market operations. The regulator has also proposed that banks must limit their capital market exposure to 40% of their consolidated net worth at the end of each March, when the financial year ends. It proposed treating investments in venture capital funds as capital market exposure. However, banks with sound internal controls and robust risk management systems can seek permission for the limits to be relaxed, it said.
As per provisional figures, FIIs were net sellers to the tune of Rs 88.70 crore on Friday (17 November), the day when the Sensex lost 76 points.
On Friday, the Dow Jones industrial average rose 36.74 points, or 0.30%, to finish at a record close of 12,342.56, which also marked its session high and a lifetime high. The Dow notched a sixth straight session of gains, its longest winning streak in a year. The Standard & Poor's 500 Index gained 1.44 points, or 0.10%, to end at 1,401.20. However, the Nasdaq Composite Index slipped 3.20 points, or 0.13%, to close at 2,445.86