Bear run: Sensex tumbles by 112 points

As compared to a high of 4,473.57 points touched in intra-day trades on September 9, Sensex has now lost nearly 280 points on selling pressure. A further correction is not ruled out on margin selling from banks, say brokers.

The National Stock Exchange S&P CNX Nifty Index shed 42.85 points to end at 1,329.55. But Sensex is still up about 24 per cent this year and 45 per cent from a six-month low hit in late April, boosted by strong foreign inflows. ‘‘I was expecting the market to fall but not at this rate. As the rise was quick, the correction is equally sharp making investors nervous,’’ said Venkatesh Aiyar, a BSE broker.

With bulls becoming bears, selling pressure was observed almost across the board. Heavyweights like Reliance Industries, State Bank of India, Hindustan Lever and ITC contributed significantly to the flopping of the market in the second half of the session. Public sector undertaking stocks wallowed in the red as well.

‘‘The sell-off in the market has been very sharp and the market could witness some bounce back. However, the near term outlook remains clouded,’’ says BSE dealer Motilal Oswal.

Inflows from foreign institutional investors (FIIs) too slowed down. On Thursday (September 11, 2003), FIIs pulled out Rs 88.30 crore, after making spirited purchases in the last few trading sessions. On Friday, they sold another $16.6 million worth of shares, says the market regulator, the Sebi.

Domestic institutions and operators were aggressive sellers, booking profit after recent gains.

HCL Technologies (down 17.97 per cent to Rs 161.40) plunged from the day’s high of Rs 190 after the company’s FY 2002-03 results disappointed investors. Other tech pivotals Satyam Computer (down 2.99 per cent to Rs 228.85) and Infosys Technologies (down 2.97 per cent to Rs 4,027.55) slipped after early volatility.

HPCL (down 7.98 per cent to Rs 390.35) dove below the Rs 400-level from the day’s high of Rs 426, on selling pressure ahead of the Supreme Court’s decision on disinvestment of the refining PSU this week. Cement pivotals ACC (down 5.76 per cent to Rs 195.45), Gujarat Ambuja Cements (down 4.94 per cent to Rs 216.55), L&T (down 2.39 per cent to Rs 294.05) and Grasim (down 1.07 per cent to Rs 609.50) declined in varying degrees.

State Bank of India (down 3.99 per cent to Rs 423.80) dropped from the day’s high of Rs 444.70. Reliance Industries (down 3.46 per cent to Rs 403.30) dipped from the day’s high of Rs 421.80 on profit booking. Other heavyweights ITC (down 1.63 per cent to Rs 790.85) and Hindustan Lever (down 0.59 per cent to Rs 183.85) contributed to the weakness of the Sensex.

National Fertilizer (Rs 49.60) remained frozen at the 20 per cent lower limit of the circuit breaker —for the entire trading session —on reports that Prime Minister has agreed to defer the disinvestment process in NFL.