Post Market Commentary - Feb 29 2008

The Indian market made a smart recovery towards the final trading hours of the session to pare most of its losses. Tracking the weak global cues, the domestic market opened on a sad note and kept on hovering in the negative territory throughout the trading session. The market tumbled in the mid session as the finance minister announced a hike in short term capital gains tax to 15% from 10% earlier. This led to the negative sentiments in the market. The finance minister kept the corporate tax and the tax on securities transaction tax unchanged. The software stocks fell, as the government did not announce any relief for this sector in terms of export. Auto stocks gained as the government reduced excise duty on small cars to 12% from 16%. Government cut excise duty on hybrid cars to 14%, from 24%. India''s wholesale price index (WPI) rose 4.89 % in the 12 months to 16 February 2008 over the same period last year from the previous week''s rise of 4.35%. From the sectoral front, the metal stocks remained the centre of attraction as most buying was seen from these baskets. The BSE Sensex closed lower by 245.76 at 17,17,578.72 and NSE Nifty fell by 61.6 points to close at 5,223.50. The BSE Mid Cap and Small Cap closed lower by 31.37 points and 40 points at 7,680.39 and 9,628.13 respectively.

The Capital Goods index declined 479.36 points at 16,119.52. Major losers are Suzlon energy (5.67%), Punj Lloyd (4.69%), Crompton Greaves (3.59%), L&T (3.24%) and ABB (2.95%).

The BSE Metal index fell by 232.49 points to close at 16,739.52. Losers are Bhushan Steel (5.45%), Jindal Stainless (3.20%), Tata Steel (2.69%), Nalco (3.04%), Jindal Steel (2.21%).

The BSE Oil & Gas index dropped by 132.71 points at 11,032 as Reliance Inds (3.09%), ONGC (2.58%), BPCL (1.18%), RNRL (0.78%), HPCL (0.70%) and GAIL India (0.67%) closed lower.

The Realty index closed lower by 267.43 points at 9,565.67 as Unitech (4.57%), Akruti City (3.51%), DLF (3.08%), Indbul Real (2.24%), Mahindra Life (1.56%) closed in red.