WebSify
Follow us on
login
Mail
Print

BSE Sensex falls; nerves spooked by trading misfire

Source : REUTERS
Last Updated: Sat, Oct 06, 2012 09:12 hrs
People watch a large screen displaying India's benchmark share index on the facade of the BSE building in Mumbai

The BSE Sensex fell on Friday, snapping a four-day rise, as profit-taking hit recent out-performers such as ICICI Bank, while sentiment was also hit after dozens of erroneous orders by a financial firm triggered a brief halt in the Nifty.

The National Stock Exchange index suddenly dropped by more than 900 points to a session low of 4,888.20 points -- 15.5 percent below Thursday's close -- after Emkay Global Financial Services placed dozens of erroneous orders worth more than $125 million.

The sudden fall shook nerves, although analysts had already expected a session of falls after the impact from India's latest reform measures, targeting the insurance and pension sectors, was expected to fade.

Traders expressed concerns the financial measures announced on Thursday would face an uncertain fate in parliament. On top of that, caution also prevailed ahead of the U.S. monthly jobs data due out later in the day.

"Irrespective of today's fall on erroneous trades, market should remain range-bound as most of the reforms are already announced," said Deven Choksey, managing director at K R Choksey Securities

"A time correction is possible till November when the winter session of the parliament begins," he adds

0.63 percent, or 119.69 points, to end at 18,938.46 points after earlier in the session hitting its highest intraday level since May 2 2011.

The 50-share Nifty fell 0.7 percent, or 40.65 points, to end at 5746.95 points, having hit its highest intraday level since April 28 2011 shortly after trading resumed after the halt.

The drop in the Nifty comes after a powerful run, with the index gaining 0.8 percent for a fifth consecutive weekly gain.

The BSE Sensex added 0.94 percent for the week.

The rally has been sparked by a slew of big ticket fiscal and economic reforms announced by the government since last month, and the prospect of increased liquidity from global monetary stimulus measures.

Some financial stocks, which make up more than a fifth of the exchange's value, fell sharply before trading was halted, including State Bank of India.

Later, recent outperformers were hit, with ICICI Bank shares falling 1.7 percent after gaining 3.12 percent in the previous two sessions.

Infrastructure-related stocks also declined after a recent surge. Power equipment maker Bharat Heavy Electricals Ltd fell 0.9 percent after adding 7.82 percent in the previous 3 sessions, while Infrastructure Development Finance corp fell 2.4 percent.

Emkay, the financial services firm behind the erroneous trades, slumped by the daily limit of 10 percent.

Mortgage lender HDFC dropped 5 percent after Carlyle Group sold a 3.7 percent stake for $841 million at a 3.5 percent discount to Thursday's closing share price.

Infosys fell 1.9 percent, ending down for a third consecutive session, as the appreciating rupee is raising worries about a potential hit to its income from overseas.

blog comments powered by Disqus
most popular on facebook
talking point on sify finance