The Hindu Business Line : Sensex tumbles as TCS disappoints market

However, what looked like a promising rebound was short-lived as a strong bout of profit booking by institutional investors sent the indices spiralling downwards towards the close of the session.

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Opening on a strong note, the benchmark indices in both the key stock exchanges rebounded and were poised to record even further gains during the second trading session of the week.

The pick-up in sentiment was believable - after all the three previous sessions had witnessed a pounding of stocks across the board, scaring away the average individual investor.

However, hopes of a turnaround were belied when towards the end of the session selling pressure started mounting, leading to a slow but sure fall in the indices.

The trigger for the complete overhaul of the positive sentiment seems to have been the declaration of lower-than-expected results by TCS for the fourth and last quarter of the fiscal gone by.

The global markets were rocked last week after the Dow Jones Industrial Average and the Nasdaq Composite slid sharply on the back of poor earnings estimates for technology companies in the US.

The expectations of a slowdown in consumer spending and possibility of a drop in margins due to an increase in costs were cited as the major reasons for the sudden fall in investor sentiment at the US markets.

The domino effect of the fall in the US, which was triggered largely by tech stocks, was also the main reason for the poor performance in the domestic markets.

So, though the jump in the indices during the first half of the session was substantial, it was still a tenuous gain.

With worries about corporate performance still lingering, the boat was rocked by the lacklustre results of TCS.

The company reported a meagre two per cent rise in topline and a fall of about five per cent in bottomline for the quarter ended March 2005.

At the BSE, the Sensex opened on a strong note at 6,181 points compared to the previous day's close of 6,157 points.

The index quickly rocketed to an intra-day high of 6,270 points.

However, the slide in the key BSE index began in the post-lunch session, and though it looked tentative and capable of being reversed, the Sensex never regained lost ground.

After touching an intra-day low of 6,121 points, the Sensex finally closed the day at 6,135 points.

The biggest negative impact on the index came during the last hour of trade.

The final tally meant a fall of about 22 points for the Sensex. With this close, the index has lost over 8.4 per cent compared to its month-ago level.

While there were an equal number of gainers and losers among the Sensex stocks, the ratio at 14:9 at the NSE was tilted heavily in favour of the losers.

The sectors that bore the brunt of the bear charge were auto, banking, IT, FMCG, metals, and pharma.

Amongst the biggest losers at the BSE were Satyam Computer, Tata Steel, Wipro, L&T, Hero Honda, ITC, HLL, SBI, Tata Motors, Reliance Energy, RIL, ICICI Bank, HPCL, BHEL, Bajaj Auto, ACC and Dr Reddy's Laboratories.

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