RTTN: Profit Taking Drags Indian Market Sharply Lower
(RTTNews) - Doubts about the pace of global economic recovery, the dollar's rebound against major global currencies, including the rupee, and signs of fatigue after a 75% plus rally since March dragged the Indian market sharply lower on Thursday.
The Indian rupee fell sharply against the dollar on Thursday amid worries more Asian countries may follow Brazil's example of imposing controls on capital inflows. Speculation was rife about U.S hedge funds repatriating dollars by year-end.
Food inflation for the 12 months to Nov 7 shot up to 14.55% from 13.68% in the previous week, government data showed, causing additional selling.
After moving in a narrow range with a negative bias in early trading, the BSE Sensex tumbled to a low of 16,712 in the afternoon before closing at 16,786, down 213 points or 1.25%.
The S&P CNX Nifty fell 66 points or 1.30% to 4,989, the BSE mid-cap index moved down 1.67% and the small-cap index shed 1.08%.
The market breadth on the BSE was fairly negative, with 1672 decliners versus 1065 gainers. Sector-wise, high-beta realty stocks bore the brunt of the selling followed by banking, metal and auto stocks.
In the sensex pack, Jaiprakash Associates (down 4.53%), Reliance Infrastructure (down 3.90%), DLF (down 3.68%), Hindalco Industries (down 3.46%), Reliance Communication (down 2.41%), Sterlite Industries (down 2.22%) and ICICI Bank (down 2.18%) were among the prominent losers.
However, mortgage lender HDFC rose 0.44%, India's largest cement maker ACC advanced 0.41% and outsourcer Wipro edged up 0.08%.
ONGC fell 1.17% on reports it plans to expand its presence in the African continent. Bombay Rayon Fashions slipped 0.75% after its board approved the allotment of 1.9 crore GDRs at an issue price of $5.11 per GDR.
KEC International rose 2.02% on bagging a contract. Suzlon Energy advanced 2.52% after it proposed to sell a 35% stake in Hansen Transmissions.
JSW Steel reversed its early gains and ended down 0.65% after the company proposed to build an auto-grade steel plant in West Bengal along with Japan's JFE Holdings. Wockhardt fell 2.86% after the company proposed to raise funds via a preferential issue.
Sugar stocks came under significant selling pressure after thousands of farmers from Uttar Pradesh protested sugarcane pricing forcing the postponement of the Parliament's stormy winter session on Thursday.
Elsewhere, the markets across the Asia-Pacific region exhibited a mixed trend amid cautious trades on concerns the recent rally might have outpaced economic fundamentals and earnings growth. The European markets are trading mostly lower in early trading, dragged down by miners, and the U.S stock futures point towards a negative opening on Wall Street Thursday morning.
