One never knows what to expect from the market. After Friday’s rebound (September 19), one would have anticipated the momentum to continue. But the week began with the key indices closing marginally in the red.
After a positive start on Monday, the market was unable to hold on to gains. Selling took place in capital goods, power and auto stocks. Profit booking was also seen in the select IT and the oil & gas stocks. Even the broader indices (BSE Mid-Cap and Small-Cap) ended in the red. L&T, Satyam and RIL were among the major Sensex laggards.
It certainly appeared that the euphoria over the Bush’s regime mega rescue plan for Wall Street faded fast. The U.S. market tanked on Monday, Asian markets opened weak on Tuesday and everyone expected the worst. They were right, the market slid even further on Tuesday. Among the 30 components of the Sensex 28 stocks ended in the red and only 2 stocks ended with positive bias – Tata Power and ACC. Infosys, ICICI Bank, HDFC and HDFC Bank were among the major laggards.
Surprisingly on Wednesday, the market started off with a positive bias defying weak global cues and managed to stay that way till trading halted for sun-outage. After reopening, bulls were unable to hold on to their gains on the back of selling witnessed in IT, consumer durables and select telecom stocks. But the Sensex and Nifty closed in the green. The major laggards were, Infosys, Wipro and TCS. Among the BSE Sectoral indices, BSE Metal, BSE Oil & Gas, BSE Bankex, BSE Power and the Mid Cap and Small Cap indices also gained.
U.S. stocks surged on reports that the lawmakers were close to an agreement on the extraordinary rescue package for the battered financial sector. As a result, the market started off on Thursday with a slightly positive bias till selling was witnessed in the IT, realty and power stocks. However, key indices managed to stage a comeback as buying was witnessed at lower levels. But the market closed lower with only 7 Sensex stocks ending in the green.
On Friday, the bulls were battered with the Sensex losing 445 points and the Nifty closing below the 4,000 mark. Sentiment was low as reports of collapse of U.S. firm Washington Mutual poured in. Reports were that America’s second largest savings and loan institution was being taken over by J P Morgan Chase. Realty and metal stocks were hammered. Banking, capital goods and power stocks were also not spared. FMCG stocks managed to escape the bloodbath.