Sensex down 3.5% on weak global cues

A sell-off in late trade pulled Key benchmark indices to day's low in what was a global equities rout. Fresh worries the global banking crisis may last longer than expected rattled bourses across the globe. US president Barrack Obama's inaugural speech overnight failed to lift sentiments as investors appetite for risky equities waned. The BSE 30-share Sensex was down 321.38 points, or 3.53%, after staying in the red throughout the day in highly volatile trade.

Negative global cues had triggered a lower start as investors confidence waned on renewed worries the global economic crisis may last longer than expected. However market cut sharp losses in mid-morning trade before slipping once again in early afternoon trade on fresh selling in index pivotals. The market extended losses in afternoon trade. Fall in European indices in opening trade kept key benchmark indices depressed in midafternoon trade. The market slumped to the day's low in late trade.

Recent selling by foreign institutional investor (FIIs) also weighed on the market. FII outflow in January 2009 totaled Rs 2644.40 crore (till 19 January 2009).

European shares slipped today, 21 January 2009, led by energy and banking stocks as fears about the health of the global economy and the financial industry deepened. The key benchmark indices in France, Germany and UK were down by between 0.61% to 1.57%.

Financial companies and metals producers, dragged Asian stocks today, 22 January 2009, on concerns mounting bank losses worldwide will intensify the global recession and squeeze demand for the region`s commodities. Key benchmark indices in Hong Kong, South Korea, Singapore, China were down by between 0.46% to 2.9%. While, Taiwan's Taiwan Weighted rose 0.13%.

Japan's Nikkei average slipped 2.04% today, 21 January 2009 after sliding to a 2-month low in intra-day trade as Honda Motor Co and other exporters fell on a stronger yen and growing worry about global financial woes.

In a historic presidential inaugural at the US Capital on Tuesday, 20 January 2009, Barack Hussein Obama was sworn in as the 44th and the first black president at a $150 million show watched by around two million people.

US stocks ended sharply lower on Tuesday, 20 January 2009, as rising concerns about the financial health of the banks and financial system weakened the feel-good factor inspired by the inauguration of Barack Obama.

High expectations for details on how the new US administration would address the growing banking crisis and faltering economy were dampened after the inauguration speech by Barack Obama concluded with little new information to digest.

The Dow Jones industrial average dropped 332.13 points, or 4.01%, to end at 7,949.09. The Standard & Poor`s 500 index went down 44.90 points, 5.28%, to settle at 805.22. The Nasdaq Composite index declined 88.47 points, or 5.78%, to close at 1,440.86.

The BSE 30-share Sensex was down 321.38 points, or 3.53%, to 8,779.17. The Sensex fell 49.24 points at the day's high of 9,051.31 in early trade. The Sensex lost 365.62 points at the day's low of 8,734.93 in late trade.

The S&P CNX Nifty fell 90.45 points, or 3.23%, to 2,706.15.

The market breadth, indicating the overall health of the market, was weak. The breadth had turned even in mid-morning trade after weak breadth in early trade. 737 shares advanced as compared with 1,691 that declined. 40 shares remained unchanged.

All the shares from the 30-share Sensex pack fell. Ranbaxy Laboratories, Bharti Airtel, Grasim Industries, Tata Power Company, Reliance Infrastructure, fell by between 4.73% to 7.32%.

Nifty January 2009 futures were at 2677.75, at a discount of 28.40 points as compared to the spot closing of 2706.15. Turnover in NSE's futures & options (F&O) segment surged to Rs 43,026.95 crore from Rs 35,511.58 crore on Tuesday, 20 January 2009.

The BSE Metal index (down 4.07%), the BSE Power index (down 3.91%), the BSE Bankex (down 3.91%), the BSE Oil & Gas index (down 3.78%), the BSE Realty index (down 3.61%) underperformed the Sensex.

The BSE FMCG index (up 0.84%), the BSE Auto index (down 1.34%), the BSE Consumer Durables index (down 1.42%), the BSE IT index (down 1.92%), the BSE HealthCare index (down 2.6%), the BSE PSU index (down 2.66%), the BSE Capital Goods index (down 3.05%), the BSE Teck index (down 3.11%), outperformed the Sensex.

The BSE Sensex has lost 868.14 points or 8.99% so far in 2009 from its close of 9647.31 on 31 December 2008. The barometer index had lost 10639.68 points or 52.44% in the calendar year 2008

India's largest private sector company by market capitalization and oil refiner Reliance Industries (RIL) fell 5.33% to Rs 1,119.40 on worries recent fall in crude oil prices will hit refining margins of the company.

PSU OMCs fell on rise in crude oil prices. BPCL, HPCL and Indian Oil Corporation fell by between 1.63% to 2.08%. Lower oil prices will reduce losses of the state-run oil firms on domestic sale of LPG and kerosene at a controlled price. The oil marketing firms are making profit on sale of petrol and diesel thanks to a sharp slide in oil prices from a record high of $147 a barrel struck in July 2008.

Crude oil rose more than $2 a barrel in New York, the most in more than two weeks, as traders purchased futures for February delivery before the contract expired today.

FMCG stocks rose on defensive buying. ITC, Hindustan Unilever, United Spirits rose by between 0.15% to 3.39%.

Capital goods stocks fell on worries a slowing economy will crimp orders. Larsen & Toubro, ABB, AIA Engineering, Thermax fell by between 0.59% to 8.78%.

India's largest electric equipment maker by sales Bharat Heavy Electricals fell 3.39% ahead of its Q3 December 2008 result today.

Auto stocks fell on worries high interest rates and sluggish consumer spending have dented demand for automobiles, including for trucks, motorcycles and scooters. Mahindra & Mahindra Maruti Suzuki India and Tata Motors fell by between 1.4% to 3.91%.

India's largest motorbike maker by sales Hero Honda Motors rose 0.64% as its net profit rose 9.24% to Rs 300.42 crore in Q3 December 2008 over Q3 December 2007.

Rate sensitive realty stocks fell on reports falling interest rates have failed to revive housing demand. DLF, Unitech, Indiabulls Real Estate and Housing Development & Infrastructure fell by between 3.93% to 5.93%.

Metal stocks declined on worries a weakening domestic and global economy has hit demand. Hindalco Industries, Hindustan Zinc, Steel Authority of India, Sterlite Industries fell by between 2.67% to 7.97%. While, National Aluminum Company rose 1.3%.

India's largest steel maker by sales Tata Steel fell 3.26% after its Thailand-based unit reported its biggest quarterly loss since 2003.

Banking stocks slipped on fears of rising defaults in a slowing economy. India's largest bank in terms of assets and branch network State Bank of India fell 2.73%. India's second largest private sector bank by net profit HDFC Bank slipped 2.53%. Its American depository receipt (ADR) fell 11.14% on Tuesday, 20 January 2009. India's largest private sector bank by net profit ICICI Bank dipped 7.12%. Its ADR fell 13.05 % overnight.

India's largest dedicated housing finance company by total income HDFC fell 7.49% after its net profit fell 15.73% to Rs 546.83 crore in Q3 December 2008 over Q3 December 2007.

UCO Bank surged 2.67% after the bank reported 107.33% surge in net profit to Rs 171.63 crore in Q3 December 2008 over Q3 December 2007.

Outsourcing focussed IT firms fell as fears a weak global economy would cut the amount firms spent on technology. India's third largest software services exporter, Wipro fell 3.35% after the company forecast a 7% fall in revenue for Q4 March 2009 on global economic downturn and pricing pressure from western clients.

In its results declared before market hours today, 21 January 2009, Wipro indicated revenue in Q4 March 2009 from information technology services, including revenue from its acquisition of Citi Technology Services, will fall 7% to $1045 million from $1126 million in Q3 December 2008. Weak forecast was due to the global economic downturn and growing pressure from western clients to cut its fees.

Wipro reported a 14.01% decline in net profit to Rs 733 crore on a 0.14% fall in sales to Rs 5397 crore in Q3 December 2008 over Q2 September 2008.

Wipro's mark-to-market loss on forex derivatives was at Rs 1,575 crore as on 31 December 2008. On a consolidated basis, Wipro's net profit grew 2.39% to Rs 1003.9 on a 1.46% increase in total income to Rs 6773 crore in Q3 December 2008 over Q2 September 2008.

India's second largest software services exporter Infosys Technologies fell 2.1% as its ADR fell 5.52% overnight. While, India's fifth largest IT exporter by sales HCL Technologies rose 3.14%.

TCS, India's largest software services exporter by sales fell 1.06% to Rs 485. The stock had touched a high of Rs 501 company said on Tuesday, 20 January 2009 had signed a multi-million dollar, multi-year deal with Ducati Motor Holding to deliver technology-based services to the Italian bikemaker and its subsidiaries in Europe. TCS had reported a lower-than-expected rise in net profit in Q3 December 2008 with the management cautioning about the tough business environment at the time of declaring results after market hours on Thursday, 15 January 2008.

India's fourth largest software services exporter Satyam Computer Services rose 3.35% on reports including Larsen & Tobro, which holds a 4% stake many other firms, has evinced interest to acquire the fraud hit firm. Satyam's ADR fell 8.18% overnight.

Educomp Solutions tanked 22.06% to Rs 1534.90 on BSE amid rising speculation the company might have fabricated its accounts overstating its turnover and profits to boost share prices

Kilburn Engineering rose 6.23% after it received an order worth Rs 11.1 crore from Tata Chemicals.

Deepak Fertilisers and Petrochemicals fell 3.48% after it reported a 9 % drop in net profit to Rs 22.38 crore in Q3 December 2008 over Q3 December 2007.

Kirloskar Oil Engines fell 3.84% after its net profit fell 54% to Rs 9.99 crore in Q3 December 2008 over Q3 December 2007.

Satyam Computer Services clocked the highest volume of 3.86 crore shares on BSE. Unitech (1.44 crore shares), Reliance Natural Resources (99.97 lakh shares), Suzlon Energy (97.29 lakh shares) and Cals Refineries (89.12 lakh shares) were the other volume toppers in that order.

Reliance Industries clocked the highest turnover of Rs 254.43 crore on BSE. Educomp Solutions (Rs 232.92 crore), Reliance Capital (Rs 152.57 crore), Reliance Infrastructure (Rs 123.49 crore) and ICICI Bank (Rs 119.61 crore) were the other turnover toppers in that order.

In the backdrop of Satyam debacle raising many burning issues for listed entities, the market regulator Sebi has scheduled a board meet later today, 21 January 2009 to discuss matters like more disclosure norms for pledging of shares by promoters and peer review of audit of large companies.

Meanwhile, in an another move likely to boost stock markets, the Sebi is likely to make it easier for more companies to raise money from the stock market, as it looks to relax eligibility rules to help them speedily raise funds from existing shareholders. Currently, only companies, which have had a market capitalisation of more than Rs 10,000 crore in the past one year, are eligible for this route. Sebi plans to lower this threshold. This has been necessitated by the steep fall in market value of companies across the board because of the bearish grip on the stock market. Sebi is also looking at reducing the issue period for rights issues to 15 days from 30 days now.