Sensex drops to 2-month low, at 15,405 points

Sensex drops to 2-month low, at 15,405 points

RIL and global cues do the damage

On top of it, the negative opening of the European markets only further spoiled the investors’ sentiments in Dalal Street.  So much so, the barometer index of BSE dropped to its lowest level in more than two months, while Nifty too inched backwards towards 4500 level.

Index heavyweight Reliance Industries (RIL) slumped over 6 per cent on reports the Comptroller and Auditor General (CAG) has set up a team to examine the expenses RIL incurred on its D6 natural gas field in the Krishna-Godavari (KG) basin in the Bay of Bengal also put some pressures.

Volatile trade

High volatility was the hallmark of the day’s trading session and selling pressure was intense with all the BSE sectoral indices ending with losses. The realty stocks was the major hit as it was down by 9.76 per cent followed by metal and oil and gas indices, which closed with losses of 5.95 per cent and 4.10 per cent respectively.  As such, the market breadth was quite weak too.

Profit taking ahead of the year-end has pulled world markets off their recent highs, while domestic stocks too have tumbled from a recent high on year-end profit taking by foreign funds. Even as the Finance Minister Pranab Mukherjee on Tuesday afternoon said that the government has to continue with its fiscal stimulus and is confident of attaining it medium-term fiscal targets, which has not calmed the stock market. He said non-farm credit growth remained an area of concern and said banks have been told to enhance credit growth.

The popular Sensex at BSE slumped 491.34 points or 3.09 per cent to close at 15,404.94 points, its lowest closing since September 3 2009. It swung between the day’s high of 78.78 points and the day’s low of 565.72 points.

The broader based S&P CNX Nifty at NSE slipped 147.80 points or 3.14 per cent to settle at 4,563.90 points in the day’s closing, its lowest since 21 August 2009. Nifty November 2009 futures were at 4,536.25, at a discount of 27.65 points as compared to the spot closing.

The BSE Mid-Cap index fell 3.74 per cent at 5,789.49, while the BSE Small-cap index fell 4.50 per cent at 6,741.24. In effect, both these indices underperformed the Sensex.

Turnover in NSE’s futures & options (F&O) segment increased to Rs 81,574.39 crore from Rs 78,337.48 crore on Friday last, while the total turnover on BSE amounted to Rs 6,207.52 crore as compared with Rs 5104 crore on October 30, 2009
In fact, the Sensex has shed 1405.87 points or 8.36 per cent in six trading days from 16,810.81 on 23 October 2009.

Market breadth weak 

The market breadth, indicating the overall health of the market was weak this day with as many as 1910 shares on BSE having declined as compared with 749 that rose and a total of 66 shares remaining static.

Meanwhile during the day at bourses abroad, European markets were trading weak with key benchmark indices in UK, Germany and France were down by between 2.06 and 2.49 per cent.

Most Asian stocks fell this day. Japanese markets were closed on November 3, 2009, for a national holiday.

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