After a fall from higher levels and a subsequent rebound, the Indian stock market turned weak and plunged deep down into the red past mid afternoon, and, despite finding some support towards the end, closed with notable losses on Friday.
Lingering concerns about the near term outlook for the global economy following some weak data out of the U.S. and Europe and worries about slowing Indian economic growth prompted investors to indulge in some heavy selling in late afternoon trade.
The Sensex, which tumbled to 18,266.76 from a high of 18,563.32, eventually ended the session with a loss of 162 points or 0.88% at 18,309.37. The Nifty index of the National Stock Exchange settled at 5574.05, slightly off the day's low of 5559.80, recording a loss of 56.95 points or 1.01%. The Nifty touched a high of 5650.15 intraday.
Shares from rate sensitive banking, realty and automobile sectors declined sharply. Realty stocks were among the worst hit and mirroring their decline, the BSE Realty index ended lower by 3.36%.
Capital goods, FMCG and power stocks too mostly closed notably lower. Consumer durables and oil stocks, which found some support early on, retreated and ended well off their highs. Select metal and healthcare stocks edged up a bit. Information technology stocks had some bright moments thanks to a weak rupee.
ICICI Bank, Tata Motors, Cipla, Hindustan Unilever, State Bank of India and Hindalco lost 2% - 2.6%. BHEL, GAIL India, Maruti Suzuki, HDFC, Larsen & Toubro, Tata Steel, Sterlite Industries, Bajaj Auto, Reliance Industries, Tata Power and Hero Motocorp lost drifted down by 1% - 2%.
IDFC, down 3.6%, was the biggest loser in the Nifty index. Reliance Infrastructure ended lower by about 3.5%. DLF, Kotak Bank and Ambuja Cements lost 3% - 3.2%.
Punjab National Bank, HCL Technologies, ACC, Cairn India, Grasim Industries, Bank of Baroda, Asian Paints, Ranbaxy Laboratories and Power Grid Corporation declined sharply.
Bharti Airtel ended stronger by over 3% on reports the telecom regulator TRAI has been asked to revise price for airwaves unsold in this week’s 2G spectrum auction. According to reports, an auction of 2G airwaves attracts less demand than targeted by the government because prices are seen as too high. In the auction held earlier this week, there were no bids for Delhi, Mumbai, Karnataka and Rajasthan.
Dr Reddy's Laboratories gained nearly 2%. Dr. Reddy's Laboratories Limited and OctoPlus have jointly announced that they have reached conditional agreement in connection with an intended public offer by Dr. Reddy's, or a wholly owned subsidiary of Dr. Reddy's, for all issued and outstanding ordinary shares in the capital of OctoPlus at an offer price of euro0.52 (cum dividend) in cash for each OctoPlus share.
Information technology bellwether Infosys moved up 1.8%. ONGC, Jindal Steel and Coal India were the other other notable gainers in the Sensex.
Biocon attracted some strong buying during the day after the company signed an agreement with Bristol-Myers Squibb. Biocon announced that it has entered into an option agreement with Bristol-Myers Squibb Company for Biocon’s IN-105, a prandial oral insulin product candidate. Under the terms of the agreement, Bristol-Myers Squibb will have the right to exercise an option to obtain an exclusive worldwide license to the program.
SREI Infrastructure moved up on strong results. Tata Coffee vaulted 15% on huge volumes. L&T Finance Holdings counter too saw heavy volumes during the day, but the stock ended on a weak note, failing to retain early gains.
After showing some strength early on, midcap and smallcap stocks retreated and ended mostly lower. The market breadth was weak. Out of 2963 stocks traded on BSE, 1738 stocks declined. 1112 stocks moved up and 113 stocks ended flat.