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Sowmya Krishnan

AFTER a three-day uptrend, driven by Reliance Infocomm's limited mobility launch and expectation of a positive outcome in the Cabinet Committee meeting on Divestment held on Friday, the stock markets dipped into negative territory on the first day of the week. The benchmark BSE-Sensex shed 23.03 points to settle at 3374.97 points. Traded volumes dipped by over 3 crore shares in just a couple of trading sessions to around 6.29 crore shares. Losers outpaced gainers at 786 to 572 shares.

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On the NSE, the 50-stock S&P CNX Nifty closed 0.59 per cent or 6.45 points lower at 1091.95 points. Around 11.46 lakh shares changed hands on the NSE.

The disappointment among the investor community was primarily due to further delay in untangling the issues related to the divestment of the oil PSUs — HPCL and BPCL. The committee deferred the sale of the oil firms in the absence of an opinion from the Attorney General and this sent the stocks tumbling followed by other PSU stocks such as Shipping Corporation (SCI) and National Aluminium (Nalco), also lined up for divestment. SCI closed 2.9 per cent lower at Rs 71.55 while Nalco was down 1.3 per cent to Rs 93.35.

Cement stocks and a few stocks such as Eicher Motors, EIH and Cosmo Films strengthened on specific price-sensitive news. Cement counters buoyed in anticipation of a price hike in one of the key markets for real estate - Mumbai. Prices are expected to go up by about Rs 50 per 50 kg bag. This activated interest in counters such as Larsen and Toubro, ACC, India Cements and Madras Cement. L&T perked up 1.72 per cent to Rs 210.50 and India Cements was up by 6.87 per cent to Rs 19.45.

Fertiliser stocks such as FACT, Madras Fertilizers and National Fertilisers were upbeat. FACT almost touched the maximum permissible limit of 20 per cent before settling down at Rs 36.05. Volumes too jumped manifold in these counters.

Eicher Motors perked up by 5.49 per cent to Rs 28.35 after two group companies made an offer to buy a 20-per cent stake in the company at Rs 30.

EIH too rose after the promoters expressed their interest to hike their stake in the company from 42.7 per cent to 51 per cent. EIH closed at Rs 194, up 3.19 per cent from Friday's close.

Cosmo Films shot up by 8.66 per cent on the back of a three-fold rise in volumes after the company announced that it might consider issuing bonus shares at its board meeting. The stock finally settled at Rs 156.15.

Tata Honeywell shot up to almost touch the maximum permissible limit of 20 per cent and finally closed at Rs 311.25. Few other active stocks for the day were Bharat Earth Movers, ETC Networks, TVS Electronics, Tata Coffee and Zodiac Clothing. Bharat Forge raced ahead to close almost 6 per cent higher at Rs 208.70.

Telecom service providers VSNL and MTNL dived southward. Both the have been facing stiff competition and Reliance Infocomm's much hyped `value for money' telecom services seemed to have further reduced investor confidence in these counters. VSNL closed at Rs 99.25, lower by 3.12 per cent and that of MTNL lost 4.54 per cent to close at Rs 94.65.

Thermax India shed over 3 per cent to Rs 142.10 after a brief uptrend.

The interest in Canara Bank, which listed at a premium on the bourses, appears to be receding. The stock closed 2.78 per cent lower at Rs 48.95.

Other losers include stocks such as Gammon India, Hindustan Construction, Apollo Tyre, Crompton Greaves, Jindal Steel, HDFC Bank, Hindustan Organic Chemicals and HMT.

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