Sensex at fresh 4-mth low on profit-booking; down 54 points
Mumbai: After rising 215 points in early trade on positive global cues after Cyprus clinched a bailout, the BSE benchmark Sensex Monday reversed gear on worries over domestic political developments with the index ending with a 54-point loss at 18,681.42, extending losses to seventh day.
The Sensex, which opened with a 158-point jump at 18,894.13 after European lenders agreed to a last-minute bailout for debt-ridden Cyprus, rose to a high of 18,950.22 as buying activity strengthened. However, concerns of domestic political stability resurfaced that triggered spate of selling in capital goods, auto, metal and banking shares.
Erasing gains, the 30-stock index fell for the seventh straight session by losing 54.18 points, or 0.29 percent to 18,681.42, its lowest level since November 26, 2012. In the seven days, the Sensex has now lost close to 890 points.
"...Indian equity market ended in the red reversing all its early gains after media reports stated that Samajwadi Party may pull the plug on the UPA government," a note by brokerage IIFL said.
Led by L&T, SBI, ICICI Bank, Hero MotoCorp,Infosys, RIL, Bharti Airtel, GAIL and Cipla, 20 stocks in Sensex ended down.
Investors viewed Samajwadi Party chief Mulayam Singh Yadav's comments about coalition politics yesterday as a signal for early elections, said stock market experts.
The NSE Nifty lost 17.50 points, or 0.31 percent, to end at 5,633.85, after touching day's high high of 5,718.40.
Stock dealers sid the market sentiment has been low ever since the DMK withdrew support last week and RBI indicated little room for interest rate cuts. Funds were also reducing holdings ahead of monthly derivative expiry on Thursday.
Globally, most Asian markets ended 0.5-2.9 percent up and European indices were trading around 1 percent up in early trade after Cyprus agreed to an aid package, paving the way for 10 billion euros of emergency loans to stave off the threat of default.
Cyprus and its euro zone partners early today reached a deal on a 10-billion euro (USD 13 billion) bailout package for the island nation to avoid bankruptcy and to keep it within the single currency group.
The finance ministers of the euro zone nations agreed at an emergency meeting in Brussels to down size the banking sector to achieve the EU average by 2018 and to gradually dissolve the Laiki Bank, the country's second largest bank.
Meanwhile, 20 scrips out of the 30-share Sensex pack ended lower and nine finished higher. Sun Pharma ruled steady.
Major losers from the Sensex pack were Hero Moto (2.42 percent), Tata Steel (2.28 percent), L&T (2.19 percent), Bharti Airtel (1.95 percent), Gail India (1.94 percent), Hidnalco Ind (1.84 percent), ICICI Bank (1.50 percent), Maruti Suzuki (1.36 percent), Wipro (1.33 percent), SBI (1.22 percent), Bajaj Auto (1.13 percent) and M&M (1.00 percent).
Among gainers, ONGC rose by 2.96 percent, followed by NTPERCENT (2.04 percent), HDFC (1.16 percent) and Dr Reddy's Lab (0.77 percent).
Sectorally, the S&P BSE Capital Goods fell by 1.44 percent, S&P BSE-Auto (0.78 percent), S&P BSE-Metal (0.66 percent), S&P BSE-Bankex (0.66 percent) and S&P BSE-FMCG (0.41 percent). However, S&P BSE-Realty moved up by 0.79 percent, followed by S&P BSE-Power (0.56 percent) and S&P BSE-Oil&Gas (0.49 percent).
Observing that investor pessimism in the country might be "overdone", German brokerage Deutsche Bank today predicted that the BSE benchmark Sensex would close the year at 22,500.
The total market breadth continued its negative trend as 1,884 counters finished with losses while 1,028 closed with gains. Total market turnover declined further to Rs 2,144.58 crs from Rs 2,189.84 crore on last Friday.