Market retreats in choppy trade

In a complete reversal of trend, the market lost ground on concerns about sharply deteriorating major global economies. High volatility in some Asian markets spilled over to Indian bourses. The BSE 30-share Sensex lost 207.59 points or 2.33%, shedding 487.27 points from the day's high.

The market was volatile with volatility in some Asian markets causing volatility here. After an initial surge on the back rally in global stocks triggered by US government's rescue of Citigroup, the market came sharply off the higher level on concerns about India's fiscal deficit, on slightly lower US index futures and easing of Asian stocks from higher level. The market bounced back later as Asian shares firmed up again after they had pared gains from an initial surge, as the US rescue of Citigroup bolstered badly needed confidence in the broader banking sector.

Later Hong Kong's Hang Seng pared gains and Chinese stocks slipped into the red after the World Bank said China's growth could well slow to its weakest pace in almost two decades next year. China's Shanghai Composite slipped 0.44%. Hang Seng was up 3%. Key benchmark indices in Japan, Singapore, South Korea and Taiwan were up by between 1.36% and 5.22%. The BSE Sensex swung 533.40 points in the day between the day's high and low.

Data continues to confirm the weakness of the global economy. South Korea on Tuesday, 25 November 2008, said consumer confidence slumped to a four-month low in November 2008, while in Germany, corporate sentiment plunged to its lowest level in nearly 16 years this month.

In Europe, Britain's top share FTSE 100 rose 1% by midday on Tuesday, 25 November 2007, with gains in embattled financials outweighing a slide in resources as the world's top miner, BHP Billiton dropped its hostile bid for Rio Tinto.

But trading in US index futures indicated the Dow could fall 43 points at the opening bell.

Closer home, Finance Minister P Chidambaram on Monday, 24 November 2008, said India is likely to miss the revenue and fiscal deficit targets in the current financial year as the government wants to spend additional money to boost the aggregate demand in the economy which has shown signs of slowing down. Thus, he said, the Centre would have to go for additional borrowings this year to meet higher expenditure. Higher government borrowing will restrict a further fall in interest rates.

The RBI has aggressively cut rates over the past two months to support growth and cushion the economy against the spreading global turmoil. The repo rate, the main short-term lending rate has been cut by 150 basis points to 7.5% since October 2008 and the cash reserve ratio, the proportion of deposits that banks have to keep with the central bank, has been reduced by 350 basis points to 5.5%.

The BSE 30-share Sensex lost 207.59 points or 2.33%, to 8,695.53. At the day's low of 8,649.40, the Sensex lost 253.72. The Sensex opened 267.16 points higher at 9,170.28. At the day's high of 9,182.80, the Sensex gained 279.68 points in early trade.

The S&P CNX Nifty fell 54.25 points or 2% to 2654. Nifty November 2008 futures were at 2643.25, at a discount of 10.75 points as compared to the spot closing.

Turnover in NSE's futures & options (F&O) segment was Rs 44,612.44 crore, which was lower than Rs 46,218.94 crore on Monday, 24 November 2008.

The barometer index BSE Sensex is down 11,591.46 points or 57.13% in the calendar year 2008 so far from its close of 20,286.99 on 31 December 2007. It is 12,511.24 points or 58.99% below its all-time high of 21,206.77 struck on 10 January 2008.

The BSE Mid-Cap index slipped 1.02% to 2,872.59 and the BSE Small-Cap index was down 0.91% at 3,333.42. Both these indices outperformed the Sensex.

Volatility may rise in the coming days ahead of the derivatives expiry for November 2008 series on Thursday, 27 November 2008. As per reports, rollover of Nifty positions from November 2008 to December 2008 series stood at 30%, as on Monday, 24 November 2008.

The market breadth, indicating the overall health of the market, was negative after strong star as small and mid-cap shares succumbed to selling pressure. On BSE, 1449 shares declined as compared with 1006 that advanced. 85 shares remained unchanged.

The total turnover on the BSE amounted to Rs 3159 crore as compared to Rs 3,206.82 crore on Monday, 24 November 2008.

The BSE FMCG index (down 0.40% to 1,900.84), the BSE Auto index (down 1.40% to 2,282.02), the BSE Consumer Durables index (up 1.38% to 1,775.99), the BSE HealthCare index (down 0.42% to 2,818.26), the BSE IT index (down 1.24% to 2,432.44), the BSE PSU index (down 0.93% to 4,554.34), the Bankex (down 2.01% to 4,365), the BSE Power index (down 1.09% to 1,601.74), the BSE Teck index (down 1.55% to 1,912.38), the BSE Metal index (down 1.06% to 4,264.17 ) outperformed the Sensex.

The BSE Oil & Gas index (down 3.86% to 5,409.37), the BSE Realty index (down 2.51% to 1,543.49), the BSE Capital Goods index (down 2.56% to 6,386.68), underperformed the Sensex.

Among the 30-member Sensex pack, 23 declined while the rest gained. Tata Motors (up 1.20% to Rs 135), Maruti Suzuki India (up 1.14% to Rs 536), and Hindustan Unilever (up 0.13% to Rs 236.25), edged higher from the Sensex pack.

Mahindra & Mahindra (down 7.51% to Rs 277), Sterlite Industries (down 6.57% to Rs 200.50), and Reliance Communications (down 5.44% to Rs 194.60), edged lower from the Sensex pack.

India's largest private sector company by market capitalization and oil refiner Reliance Industries (RIL) crashed 8.21% to Rs 1051 on high volumes of 29.95 lakh shares. The stock retreated sharply from day's high of Rs 1184.90 as concerns a global slowdown would hit demand for petrochemicals offset reports of fall in rig rentals. It was the top loser from the Sensex pack.

India's largest oil exploration firm Oil & Natural Gas Corporation (ONGC) was up marginally by 0.15% to Rs 680 after it struck oil at an oil block in Andhra Pradesh.

State run oil marketing companies were mixed after the oil minister, Murli Deora, today, 25 November 2008, said the government may cut fuel prices after 24 December 2008. HPCL (down 3.45% to Rs 235), BPCL (down 1.69% to Rs 331.15), slipped. However IOC rose 0.60% to Rs 409.

The government would be unable to cut prices before 24 December 2008 because of the Election Commission's code of conduct for ongoing assembly elections in a handful of states.

US crude oil fell 3% to $52.88 a barrel today, 25 November 2008 after rising more than 9% on Monday, 24 November 2008.

Most banking & financial shares slipped on worries that more global banks might be forced to seek government's help after US government's rescue of Citigroup. India's largest state-run bank by net profit State Bank of India plunged 7.52% to Rs 1061.

India's largest private sector bank by net profit ICICI Bank fell 0.78% to Rs 320.05 after hitting a high of Rs 342.

However India's largest private sector bank by net profit HDFC Bank rose 0.67% to Rs 837.15 following a 12.96% surge in its American depository receipt on 24 November 2008.

India's top mortgage lender by net profit Housing Development Finance Corporation (HDFC) slipped 1.50% to Rs 1353 despite reports several investors, including sovereign wealth funds, have expressed interest in buying Citigroup's stake. Citigroup is the single-largest shareholder in HDFC with a 11.74% stake.

India's top pharma company by sales Ranbaxy Laboratories by sales fell 5.83% to Rs 201.20 on reports the company's subsidiary Ranbaxy Fine Chemical's (RFCL) plans to acquire the US-based speciality chemicals maker Mallinckrodt Baker is facing delays because of valuation problems.

Other shares from the healthcare sector also fell. Dr Reddy's (down 2.49% to Rs 419), Sun Pharma (down 0.75% to Rs 1073), and Cipla (down 0.67% to Rs 186.40) slipped.

GlaxoSmithKline Pharma rose 1.66% to Rs 1170.50 after a block deal of 47,100 shares was executed on BSE at Rs 1175 a share. The block deal constituted 0.06% of the company's equity.

IT pivotals fell on concerns about the weakening US economy and on a stronger rupee. India's second largest software services exporter Infosys Technologies slipped 1.35% to Rs 1180. The stock retraced from day's high of Rs 1230

Wipro (down 1.01% to Rs 231.10), and TCS (down 3.78% to Rs 501), also edged lower.

India's fourth largest software services exporter Satyam Computer Services shot up 1.81% to Rs 233.75 on a 8.56% gain in its American depository receipt on Monday, 24 November 2008. It was the top gainer from the Sensex pack.

HCL Technologies slumped 8.24% to Rs 137 after its chief executive said margins will be squeezed by the acquisition of British software firm Axon.

The partially convertible rupee was at Rs 49.92/93 per dollar, 0.3% above Monday's close of Rs 50.09/10. A stronger rupee impacts operating margins of IT firms as they earn most of their revenues from exports with US as the major market.

Telecom companies slipped despite reports the much delayed spectrum allocation process is all set to be kicked off with the government likely to begin spectrum allocation in the next 10 days. India's top cellular services provider by marketcapitalisation Bharti Airtel fell 2.83% to Rs 618. India's top cellular services provider by marketcapitalisation Reliance Communication slumped 5.44% to Rs 194.60.

Tata Communications spurted 0.10% to Rs 397.45 after its American depository receipt galloped 27.41% on the New York Stock Exchange on 24 November 2008.

Capital goods shares dropped on worries a slowing economy would crimp orders. The country's largest power equipment maker by sales, Bharat Heavy Electricals, slipped 1.40% to Rs 1283 despite reports it is in talks with Japan-based Toshiba Corporation to set up a joint venture, which will enable it to offer turnkey services in the country and provide high-rated equipment for the domestic transmission sector.

India's top engineering and construction firm by sales, Larsen & Toubro (L&T), fell 3.51% to Rs 732.25, despite reports it has lined up investments of Rs 2,000 crore in its proposed forging plant at Hazira.

Consumer durable stocks rose on hopes falling interest rates will help revive demand. Titan (up 4.96% to Rs 896), and Blue Star Industries (up 2.87% to Rs 156), gained.

Reliance Industries topped the turnover chart on BSE with turnover of Rs 337 crore followed by State Bank of India (Rs 198 crore), Reliance Capital (Rs 182.70 crore), Educomp Solutions (Rs 143 crore) and Reliance Infrastructure (Rs 132.20 crore).

GVK Power Infrastructure led volumes chart on BSE clocking volumes of 2.20 crore shares followed by Suzlon Energy (1.23 crore shares), Unitech (1.12 crore shares), Reliance Natural Resources (64.80 lakh shares) and Sesa Goa (63.25 lakh shares).

Sandesh rose 19.83% to Rs 119.95 after the company's board scheduled a meet on 1 December 2008 to consider buyback of its equity shares. The company announced the board meet after trading hours on Monday, 24 November 2008.

Atlanta soared 4.92% to Rs 58.60 at 10:53 IST on BSE, on bagging an order worth Rs 146.48 crore from Gujarat Industrial Development Corporation for infrastructure works for Dahej special economic zone (SEZ) at Dahej, Gujarat.

Tata Chemicals fell 1.49% to Rs 138.45 on reports the company has put on hold expansion of its soda ash plant in Gujarat because of weak market conditions. Tata Chemicals had planned the expansion of its Mithapur soda ash plant in Gujarat to 1.2-million tons a year from 9,75,000 tons.

Dabur India jumped 6.96% to Rs 80.20 after the company acquired 72.15% stake in skin care products firm Fem Care Pharma for Rs 203.7 crore in an all cash deal. Shares of the latter rose 0.21% to Rs 688.95. Dabur had announced the acquisition after trading hours on Friday, 21 November 2008.