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Sensex runs out of steam

Krishnan Thiagarajan

AFTER closing in positive territory in the last four trading sessions, the BSE Sensex lost steam on Wednesday, shedding 45.92 points (or 0.95 per cent) to settle at 4795.46 points.

The markets appear to have shrugged the encouraging GDP growth rate of 8.2 per cent for the Indian economy in the January-March quarter and full year. These GDP growth numbers released by the Central Statistical Organisation were aided largely by the growth in the farm sector by 10.5 per cent in the latest quarter compared to negative growth over the same period a year ago.

The distinctly weak undertone had set into the Sensex towards the last hour of trading, after remaining fairly stable in the 4830-40 band through the day. The Sensex opened for the day at 4859.94, touched a high of 4877.90 and a low of 4788.85, before closing marginally higher at 4795.46 points.

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Among the Sensex constituents, the heavyweights that lost value were Reliance, Infosys Technologies, ICICI Bank, Hindustan Lever, ONGC and HDFC.

The S&P CNX Nifty also lost ground, declining by 12.7 points (or 0.84 per cent) to close at 1505.60 points. Among the top five gainers in the Nifty were Colgate Palmolive, MTNL, Shipping Corporation of India, Punjab National Bank and Indian Hotels. The top five losers were Gail, Dabur, HCL Technologies, Reliance and HDFC.

The Nifty Junior, however, ended on a positive note, up by 8 points (or 0.28 per cent) to close at 2903.35 points. The top five gainers among the Nifty Junior were IDBI, Jindal Vijayanagar Steel, Ingersoll Rand, Pfizer and Siemens. The top five losers were Corporation Bank, Polaris Software, Indian Overseas Bank, Canara Bank and Vijaya Bank.

Sectoral movers, shakers

Among the BSE Sectoral indices, the sectors that rallied sharply in relation to the Sensex were BSE Capital Goods and BSE Consumer Durables. And the sector which languished during the day was BSE-IT Index. The BSE Capital Goods Index appreciated by 1.15 per cent, with prominent gainers being Thermax (7.16 per cent), Ingersoll Rand (4.49 per cent), Larsen and Toubro (3.74 per cent) and Siemens (3.32 per cent). This movement in the capital goods segment has to be seen in the light of the 7.3 per cent upswing in the manufacturing sector in the January-March quarter.

The BSE-IT was the laggard, with the index shedding 1.42 per cent. Some of the prominent losers were Polaris Software (4.3 per cent), HCL Technologies (3.18 per cent), Wipro, Infosys Technologies and Satyam.

The gainers and losers during the day were driven by either earnings performance or specific events. For instance, Mahanagar Telephone Nigam gained by Rs 7.1 or 5.68 per cent to close at Rs 131.95 on expectations that MTNL will get a huge refund from the IT Department as the IT tribunal had ruled that licence fees paid to DoT are to be treated as expenditure. Trading volumes in the stock shot up sharply from 4.33 lakh shares on Tuesday's trading to 10.66 lakh shares during the day.

The other gainer was Opto Circuits whose stock was bolstered by stable earnings performance. The stock price rose by Rs 4.7 (or 9.88 per cent) to settle for the day at Rs 52.25. The trading volumes, however, slipped marginally during the day's trading.

The Pfizer stock was another prominent gainer, led by its earnings performance. Its post-tax earnings shot up to Rs 9.35 crore for the quarter ended May 31, 2004, compared to Rs 1.21 crore in the same period of the previous year. The stock appreciated by Rs 19.65 to close at Rs 450.95.

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