SBI acts as dampener in volatile pitch; Sensex falls 207 points

Banking stocks took heavy beating today after SBI’s results and on Moody's downgrade. The Sensex fell 207 points and the Nifty slid 68 points

Major headlines

Ranbaxy Laboratories tumbles on net loss in Q3

SBI Q2 consolidated net profit at Rs3470.43 cr

Compat put stay on Rs630 crore penalty imposed by CCI on DLF

India's October car sales fall the most in more than a decade

Moody's cuts India banking outlook

IOC Q2 net loss at Rs7485.55 crore



Indian indices

After witnessing a directionless trade for most part of the session, the Indian markets came under pressure in the last hour as selling intensified in banking shares after SBI posted Q2 numbers. Banks also fell after Moody's Investor Service downgraded its outlook for India's banking system to 'negative' from 'stable. Pressure from metal, realty, oil & gas, PSU, auto and pharma stocks further pushed markets lower. Fall in the European equities owing to worries over Italy and Greece weighed on the sentiments.

SBI was the major culprit behind today’s fall alongwith other heavyweight draggers like RIL, Tata Steel, ICICI Bank, ICICI Bank, M&M, ONGC, DLF, HIndalco and Sterlite.

Sensex movements: Positive global cues helped the Sensex to rise by 72 points at 17642 in the opening trade and soon hit an intraday high of 17658. Then the index swung between positive and negative zones for major part of the day. In the late trade, sharp fall in banking stocks and weak European cues dragged the index to intraday lows of 17331. The Sensex tumbled 207 points to close at 17362 and the Nifty stood at 5221, down by 68 points.

Market sentiments

The market breadth stood weak, with 1879 shares falling, 991 shares rising and 104 traded unchanged.

Viewing volumes

India's second largest developer – Unitech was traded the most with over 0.36 crore shares changing hands on the BSE. Followed by an integrated infrastructure development company - Lanco Infratech (0.29 crore shares), the biggest bank in Asia - SBI (0.26 crore shares), India's largest automobile company – Tata Motors (0.23 crore shares) and a major Indian telecommunication company - Reliance Communications (0.22 crore shares).

Sectoral & stock screening

Only three sectoral indices closed higher out of 13. Gainers — BSE FMCG rose by 1.17%. BSE IT surged by 0.42% and BSE TECk advanced by 0.01%. Top three losers — BSE Bankex fell by 2.62%, BSE Metal down by 2.50% and BSE Realty slipped by 2.48%.

In 'A' group stocks, major gainers — United Spirits up by 4.89%, Ashok Leyland surged by 3.47% and HUL rose by 2.85%. On the other side, SBI fell by 6.76%, Gujarat Gas declined by 6.08% and Indiabulls Financial Services down by 5.92%.

Global Indices

The European stock markets turned negative on Wednesday (November 09, 2011 surrendering early gains as a relief rally sparked by Italian Prime Minister's plan to step down petered out, with banks leading the retreat.

The Asian stock markets ended higher on Wednesday as Italian Prime Minister Silvio Berlusconi’s offer to resign bolstered optimism that Europe may find a way to contain its sovereign-debt crisis. However, Straits Times closed lower.

The US stock index futures pointed to a weaker open for equities on the Wall Street on Wednesday.

Market Outlook: In the US, EIA Petroleum Status Report will be released on Wednesday.