Profit taking pares pivotal prices; Sensex dips 274 pts

Key benchmark indices on Monday trimmed losses after hitting fresh intraday lows in late trade on the backdrop of political uncertainty ahead of Uttar Pradesh Assembly election results scheduled to be announced on Tuesday.

Even as exit polls suggested that there may be hung assembly in UP and Samajwadi Party is likely to finish on top.  Besides, next week there will be Union Budget, Railway Budget, the economic survey and also the RBI monetary policy review, so there is an expectation that Congress will be little more free from the burden of its existing coalition partners. existing coalition partners.

Weakness in global stocks hit investor sentiment adversely as China — the world’s second largest economy after the US — cut its economic growth forecast to its lowest level in eight years.

China’s Premier Wen Jiabao cut the country’s growth target to 7.5 per cent for 2012, from an 8 per cent goal in place since 2005.

Shares of GAIL hit 52-week low, while index heavyweight Reliance Industries (RIL) shed nearly 2 per cent. ICICI Bank, Reliance Industries and Infosys accounted for a 112-point loss on the Sensex.

 Realty stocks extended recent losses. Interest rate sensitive banking stocks edged lower on fears banks' bad loans could increase in a slowing economy, while metal stocks too declined.

With the exception of BSE FMCG index, all the other 12 sectoral indices on BSE were in the red. Geojit BNP Paribas Securities’ technical analyst Hormuz Maloo said “in the medium term, the markets will move lower.

However, currently we seem to be moving sideways after the steep fall witnessed on Februrary 27. There is no clear short-term trend evident on the charts, though the bias seems to be on the downside. I think it might be best to await a clear signal before taking a position for the short term.” The BSE Sensex shed 274.12 points or 1.55 per cent to settle at 17,362.87, its lowest level since February 1, 2012. The index fell 324.69 points at the day’s low in late trade and fell 38.57 points at the day’s high in early trade.

Overall weakness

The S&P CNX Nifty lost 79.05 points or 1.47 per cent to settle at 5,280.35, its lowest closing level since February 2, 2012. The index hit low of 5,265.70 and a high of 5,344.50 in intraday trade.

The market breadth, indicating the overall health of the market, was weak. On BSE, 1,844 shares fell and 986 shares rose. A total of 111 shares were unchanged. BSE clocked turnover of Rs 2446 crore.

The barometer index of BSE has lost 389.81 points or 2.19 per cent in March 2012 so far (till 5 March 2012). The Sensex had jumped 559.13 points or 3.25% in February 2012. The index has surged 1,907.95 points or 12.34% in calendar 2012 so far (till 5 March 2012) on the back of heavy inflow from foreign funds.

From a 52-week low of 15,135.86 on 20 December 2011, the Sensex has risen 2,227.01 points or 14.71 per cent and from a 52-week high of 19,811.14 on 6 April 2011, the Sensex has lost 2,448.27 points or 12.35 per cent.