After reeling under tremendous pressure on getting disappointing Infosys quarterly earnings result, the frontline indices nosedived even further as selling pressure intensified on getting highly daunting March month Inflation numbers which casted a gloomy shadow over the economy's outlook. Initially the selling pressure was seen only in blue chip stocks but post the March inflation numbers which surged to 8.98% from 8.31% in the previous month, market participants went for broad based selling taking their profits off the table. However, the benchmarks got some support at the crucial 5,800 and 19,300 levels as some partial pull back was witnessed after the indices touched intraday low levels. While optimistic start for the European indices too eased the selling pressure to some extent. On the sectoral front, all indices languished in the negative terrain with the information technology sector bearing the maximum brunt and deposing 5.56% on the back of a nasty 8.17% laceration in bellwether Infosys while another heavyweight Wipro got clobbered by 4.21%. The high beta real estate pocket too witnessed hefty bouts of profit booking and shaved off 1.28%. Index heavyweight Reliance Industries also failed to make its presence felt in the session as it plunged by 1.15% after challenging an oil ministry directive and refusing to sell natural gas to power and fertilizer plants by cutting supplies to non priority sectors like steel and refineries saying the move has financial and legal implications.
Meanwhile, the broader markets also succumbed to the selling pressure and are trading with moderate cuts of around a quarter percent. The market breadth on the BSE was strongly in favor of declines in the ratio of 1126:1567 while 98 scrips remained unchanged. Moreover, the market volumes have already crossed the volumes of Rs 1 lakh crore mark.
The BSE Sensex plummeted 267.02 points or 1.36% at 19,429.84. The index touched a high and a low of 19,700.96 and 19,337.12 respectively.
The BSE Mid-cap and Small-cap indices fell 0.31% and 0.17%, respectively.
On the BSE sectoral front IT down 5.56%, Teck down 4.17%, Realty down 1.28%, Oil and Gas down 1.01% and Power down 0.97% were the major laggards, while there were no gainer.
The top gainers on the Sensex were Hero Honda up 3.28%, Hindalco Inds up 1.31%, Bharti Airtel up 1.03%, L&T up 0.72% and Jaiprakash Associates up 0.71%.
On the flip side only Infosys down 8.17%, Wipro down 4.58%, DLF down 1.89%, HUL down 1.74% and ICICI Bank down 1.65% were the major losers on the index.
Meanwhile, the Indian government on Thursday indicated that while the formation of the competition commission of India (CCI) was aimed at ensuring ethical business play and controlling monopolies and restrictive trade practices, it will take care of legitimate concerns of India Inc on road blocks to mergers and acquisition (M&A). Corporate affairs minister Murli Deora said in this connection that government was aware of concerns expressed by the industry and will ensure that competition rules do not lead to unnecessary red tape. He explicitly stated that final rules for M&A could include a minimum threshold for reporting buying of assets including shares by firms, a proposal that has seen strong backing by forms across various industries.
Deora has also convened a meeting with industry leaders on 25th April at Mumbai to ensure that concerns of the corporate world are accommodated while framing competition rules. The meeting has been called after he had discussion with corporate affairs secretary D K Mittal and Chairman of CCI Dhanendra Kumar on concerns raised by the India Inc on regulations of merger and acquisition by the Commission. The minister assured that there would be no disruption in the activities of corporate India when the new norms kick in at the start of June.
He also assured that there will be wide consultations with India Inc through proposed interactive meetings at Mumbai, Bangaluru, Ahmedabad, Hyderabad, Chennai, Kolkata and Delhi and his ministry will ensure a smooth transition from 1st June, 2011 regarding regulation of merger and acquisition in the country. The move, according to analysts, will make India at par with other economies including China and Brazil where such regulations have already come into force.
The S&P CNX Nifty plunged 78.70 points or 1.33% at 5,832.80. The index touched high and low of 5,907.35 and 5,806.45, respectively.
The top gainers on the Nifty were Hero Honda up 3.50%, Hindalco up 1.29%, Bharti Airtel up 1.03%, JP Associates up 0.97% and L&T up 0.72%.
On the other hand, Infosys down 8.43%, Siemens down 4.54%, Wipro down 4.37%, HCL Tech down 2.79% and DLF down 2.25% were the losers on the index.
On the global front, Shanghai Composite was up 0.17%, Hang Seng was up 0.02% and Jakarta Composite was up 0.32%,On the other hand, KLSE Composite was down 0.48%, Nikkei 225 was down 0.65%, Straits Times was down 0.19%, Seoul Composite was down 0.03% and Taiwan Weighted was down 0.96%.
The European markets are trading on an optimistic note as the France's CAC 40 added 0.29%, Germany's DAX climbed 0.28% and Britain's FTSE 100 advanced 0.23%.
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