Global cues hurt sentiments, Sensex goes below 14,350

The key benchmark indices on Monday extended last week’s losses on the back of weak global cues, even as specific-stock buying was evident in rally amid volatility during the trading as June futures and option (F&O) contracts are to expire on coming Thursday.

Stocks fell in Europe, while US index futures dropped after the World Bank on Monday predicted that the global economy will shrink 2.9 per cent this year, a deeper fall than the 1.7 per cent contraction it predicted in March 2009.

Yet, specific-stock buying was evident in rally in domestic bourses outside the two key indices — Sensex and Nifty with bouts of volatility during the trade this day.  Oil & gas, metal, IT, realty and auto stocks led the decline. The market surged in early trade tracking higher Asian stocks and a revival of the south-west monsoon also aided the early surge. But the market gave up all the gains and slipped in the red for a brief period before bouncing back in mid-morning trade. The recovery proved short-lived and the market weakened later.

High volatility

Volatility may remain high ahead of the expiry of June 2009 futures and options (F&O) contracts on  June 25  2009, observe traders here. The popular Sensex at BSE lost 195.67 points or 1.35 per cent to close at 14,326.22 points. The S&P CNX Nifty at NSE was down 78.35 points or 1.82 per cent to close at 4,235.25. Nifty June 2009 futures were at 4226, at a discount of 9.25 points as compared to the spot closing of 4235.25    Turnover in NSE’s futures & options (F&O) segment was Rs 71,601.05 crore, much lower than Rs 79,597.86 crore on  June 19 . BSE clocked a turnover of Rs 5,130 crore, lower than Rs 5,959.89 crore on Friday last.

Market breadth weak

The market breadth turned weak from a positive breadth earlier in the day. On BSE, 1,112 shares rose as compared with 1,498 shares that declined and a total of 70 shares remained unchanged. From the 30 share Sensex pack 23 stocks fell and rest rose. The BSE Mid-Cap index was down 0.57 pc and the BSE Small-Cap index was down 0.33 pc