Rail Bud disappoints mkts;Sensex,Nifty log worst fall in 2 wks

Indian markets today logged their worst daily drop in two weeks with benchmark Sensex tumbling 261 points to 28,746.65 and Nifty slipping over 83 points to below 8,700 mark after the first full Railway Budget of the Modi government disappointed market participants.

Profit-booking was seen mainly in IT, Healthcare, Capital Goods and Banking shares sectors in view of expiry of futures and options February contract.

Brokers said the Railway Budget was futuristic but lacked details on how Railway Minister Suresh Prabhu will raise the money required to bank roll various projects announced today even as passengers were spared of any hike.

Investors also turned cautious as market was abuzz with speculation that the Union Budget to be presented on Saturday will have a populist tilt, they added.

Coal India shares fell after announcement of freight rate hike from April 1, 2015.

Stocks of cement and steel makers also followed suit as participants were unsure of whether companies will be able to fully pass on the hikes in a weak demand scenario, market analysts said.

The BSE Sensex resumed higher at 29,051.90 and moved up to 29,069.13 on initial strong buying. However, it dropped afterwards to 28,693.82 before ending at 28,746.65, showing a loss of 261.34 points of 0.90 per cent. This its worst show since February 9, 2015.

Similarly, the CNX 50-share Nifty fell by 83.40 points or 0.95 per cent to finish at 8,683.85.

"Markets have been likely disappointed by absence of several big announcements relating to dedicated freight corridors or other capex programmes as well as finer details on FDI/PPP financing. But focus on effective implementation, improving operating ratio....bodes well in the long term," said Kotak Securities Head-PCG Research Dipen Shah.

Foreign portfolio investors (FPIs) bought shares worth a net Rs 516.06 crore yesterday as per provisional data released by the stock exchanges while Domestic institutional investors (DIIs) bought shares worth a net Rs 19.70 crore yesterday.

European stocks were trading higher as key benchmark indices in France and Germany were up 0.12 per cent to 0.17 per cent while the UK's FTSE slipped 0.03 per cent.

Most Asian stocks ended higher today after upbeat US housing data. Key benchmark indices in China, Japan, South Korea and Hong Kong rose by 0.28 per cent to 2.15 per cent while key benchmark indices in Singapore and Taiwan fell by 0.43 per cent to 0.80 per cent.

Veracity Broking Services, Head of Research, Jignesh Chaudhary said: "Weakness was seen in the market as investors preferred to stay cautious in an unsure market on the day of the expiry. Also, the pre budget correction further hammered the market."

As many 24 scrips out of the 30-share Sensex pack ended lower while only six counters finished higher.

Major Sensex laggards were BHEL (3.47 per cent), Sun Pharma (2.85 per cent), Infosys (2.53 per cent), Cipla (2.51 per cent), Hindalco (2.48 per cent), Bajaj Auto (2.10 per cent), SBI (2.03 per cent) and Maruti (1.94 per cent).

Tata Steel (1.62 per cent), HUL (1.42 per cent), Tata Motors (1.26 per cent), M&M (1.16 per cent), Sesa Sterlite (1.09 per cent) and Larsen & Toubro (1.04 per cent).

However, NTPC rose by 4.90 per cent, followed by Gail India 1.57 per cent, ONGC 0.63 per cent and Bharti Airtel 0.47 per cent.

Among the S&P BSE sectoral indices, IT fell by 1.43 per cent, followed by Auto 1.43 per cent, Capital Goods 1.31 per cent, Teck 1.21 per cent, Healthcare 1.17 per cent and Bankex 0.93 per cent.

Small-cap and Mid-cap indices also fell by 0.81 per cent and 0.79 per cent respectively on sustained selling by retail investors.

The total market breadth remained lower as 1,749 stocks ended in red, 1,078 finished in green while 104 ruled steady. The total turnover rose further to Rs 4,867.74 crore from Rs 4,412.77 crore yesterday.