Sensex breaks 5-day positive run, loses 295 pts

Selling pressure emerged in trade today, which led the Sensex to snap five-day rally and close the session 295 points lower

Major headlines

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Indian indices

Selling pressure took its toll today, with the Indian markets closing with sharp declines after its five-day rally. Heavyweights like L&T, ONGC, ICICI Bank, Tata Motors led to a major decline. Anil Dhirubhai Ambani Group (ADAG) stocks were again in focus and tumbled, adding pressure to the markets. The Nifty, which traded strong in early trade, could not surpass 5630 (200 DMA) and lost momentum to close below the 5500 mark. All the sectoral indices ended in the negative zone. The broader markets were worst hit.

Among Midcap stocks, State Trading Corporation, Bank of Maharashtra and Info Edge ended the session with gains of 4-9%. On the other hand, Anant Raj Industries slipped 19.61%, while Deccan Chronicle and Jain Irrigation fell 9.69% and 8.18% respectively.

In Smallcap index, Surana Industries, Adhunik Metaliks and ITI rose 5.5-9%. However, Tanla Solutions, Bliss GVS and Thomas Cook fell over 8% each.

Tracking positive global markets, the Sensex began the trade 57 points higher at 18564 and extended gains to hit the day's high of 18691 in early trade. However from that level, the Sensex gradually started to trim gains and turned negative in mid-morning session as selling emerged across the board. In the afternoon session, the index traded weak and hit the day's low of 18160 in late trade owing to all-round selling.

The Sensex fell 295 points to close at 18212 and the Nifty stood at 5459, down by 88 points.

Bond & Rupee update: India’s 11-year bonds, the most-traded government debt, headed for a second weekly advance on optimism slowing inflation will spur demand. India’s rupee headed for its biggest weekly gain in more than two months on speculation the nation’s economic growth outlook and yield advantage will attract overseas investment.

Market sentiment

The market breadth was weak as declined shares outpaced the advancing ones over twice. Of the 2,980 stocks on the BSE, 2,085 declined while 773 rose. However, 122 stocks closed unchanged.

Sectoral & stock screening

All the sectors closed the session in the red. BSE Realty tumbled the most by 4.04%, followed by BSE Auto down by 2.39% and BSE Oil & Gas slipped by 2.09%. Other sectors lost in the range of 1-2%.

In 'A' group stocks, top three gainers - Hindustan Copper rose by 11.71%, Hindustan Unilever surged by 1.99% and Tata Chemicals gained by 1.90%. Top three losers - Jain Irrigation slid by 8.18%, Reliance Capital dropped by 6.98%, and Unitech dipped by 6.94%.

Viewing volumes

India's second largest developer - Unitech was traded the most, with over 1.31 crore shares changing hands on the BSE. Following that India's Number 2 mobile carrier - Reliance Communications (0.55 crore shares), leading housing finance firm - LIC Housing Finance (0.51 crore shares), wind turbine major - Suzlon Energy (0.37 crore shares) and industrial finance company - IFCI (0.28 crore shares).

Global signals

European shares turned negative, with technical indicators pointing to overbought conditions and miners continuing their slide downwards as worries remain over political unrest in the Middle East.

All the major Asian indices ended the session on a positive note except China’s Shanghai Composite.

The US stock index futures point to a lower opening on the Wall Street.