Sensex down 438 points as FIIs go for profit booking

Weak trends seen in foreign markets

Extremely weak trends in European markets and US futures weighed on the local bourses.

The Bombay Stock Exchange 30-share barometer settled the day at 14,665.92, down 437.63 points or 2.90 per cent from its previous close. The 50-issue Nifty of the National Stock Exchange also tumbled by 157.00 points or 3.42 per cent to 4,429.90 from its last close.

Selling by FIIs

Investors resorted to across-the-board selling as foreign institutional investors began pulling out from equity in later afternoon trade. Bonanza Portfolio Assistant Vice-President Avinash Gupta said, "Falling metal prices and China giving incentives for export of steel products induced profit-taking and it seems a correction is setting in. The market is expected to be range-bound with rises/falls between 4,250 and 4,500."

The equity markets witnessed a massive capital inflow of Rs 22,133 crore between May 1 and June 4 2009 on optimism about speedy economic reforms in post-election political stability.

DIIs, which have been net sellers in the current month, stepped up their sales during the day.

European markets down

European markets were down by about 1.2 per cent to 1.61 per cent in early trade ,
Taiwan Weighted by 3.34 per cent and Straits Times by 2.97 per cent.

Other Asian markets ended on a mixed note with a key index of Tokyo markets, the Nikkei, shutting shop in the green gaining 97.62 points to end trade at 9,865.63 points.
On the other hand, the Hang Seng, the primary index of the Hong Kong Stock Exchange, fell 426.14 points to 18,253.39 points.

Sectoral indices

The BSE realty index slumped 424.82 points or 10.54 per cent, metals 761.92 points or 6.51 per cent and the Bankex 362.52 points or 4.42 per cent.

Small-cap and mid-cap shares bore the brunt of heavy selling, resulting in their indices plunging by 374.77 points or 5.80 per cent and 294.93 points or 5.45 per cent, respectively.

Among sectoral indices, only IT survived to settle in the green while all other indices ended lower between 10.54 per cent and 1.21 per cent.

Market breadth down

The total market breadth turned negative with 2,246 counters losing against 582 gainers.

In the Sensex pack, Jaipra Asso dropped 10.40 per cent, DLF 10.34 per cent, Tata Steel 10.21 per cent, REL COM 8.68 per cent, REL Infra 8.55 per cent, SBI 6.76 per cent, Ranbaxy 6.45 per cent and Tata Motors 6.25 per cent.

However, Wipro rose by 3.36 per cent, Infosys Tech by 2.52 per cent and TCS by 2.29 per cent.