Key benchmark equities on Tuesday slumped on the back of weak global cues and no positive surprises in the Railway Budget presented by Pawan Kumar Bansal led to selling in the index heavyweights like Reliance Industries, ICICI Bank and HDFC.
The popular Sensex at BSE lost 316.55 points or 1.64 percent to settle at 19,015.14 points, which is its lowest closing level since November 27, 2012. The index declined 354.75 points at the day's low and fell 38.20 points at the day's high in early trade. Simply put, the Sensex dropped below 19K level in the intra-trade and regained it after falling below that mark in late trade.
So much so, share prices of companies catering to the railway sector came under huge pressure as they tanked up to 8 percent after the Railway Minister delivered his maiden budget in the parliament where Bansal said the target of 700 km of new lines in the current year had to be scaled down to 470 km due to inadequate resources and the target of 800 km for gauge conversion fixed for 2012-13 has been scaled down to 575 km.
Further, there was no benefit announced for the railway wagon makers which dampened the investor sentiment in D-Street further. Kalindee Rail Nirman was the largest loser and dropped 8.10 per cent on the BSE, followed by Hind Rectifiers (down 6.71 per cent), Kernex Microsystems (down 6.42 per cent). Among others, Stone India tanked 6.53 per cent, Titagarh Wagons slipped 5.65 per cent, Texmaco Rail (down 4.87 per cent), Zicom Security (down 3.60 per cent) and BEML (down 2.17 per cent). Earlier, weakness in global stocks hit investor sentiment adversely. Stocks fell across the globe as political paralysis in Italy after general elections fueled fears of renewed instability in Europe, scaring investors out of risky assets.
The market breadth was weak as all the major BSE sectoral indices were trading in red zone, apart from IT and FMCG. The BSE Oil & Gas index declined by almost 2.5 percent followed by counters like Auto, Capital Goods, PSU and Metal, all plunging by almost 2 per cent each.
Commenting on the market, Kotak Securities' Dipen Shah said, "Market sentiment was weak to start with and the selling pressure continued to intensify throughout the day leading to a loss of more than 300 points for the Sensex at the close. Weak opening of the European markets added to the selling pressure. European shares opened sharply lower on Tuesday, with Italian stocks as the worst performers, as political deadlock gripped the euro zone's third-largest economy after an inconclusive election result.”
The 50-unit CNX Nifty was down 93.40 points or 1.6 percent to close at 5,761.35, its lowest closing level from November 27, 2012. The index hit a low of 5,748.60 and a high of 5,838.85 in intraday trade.
The BSE Small-Cap index was off 2.43 percent to 6,318.36 points, while the BSE Mid-Cap index slumped 1.76 percent to close at 6,414.32 points. Both indices underperformed the Sensex.