Stocks Hammered

Equity markets went into a tailspin in the week ended September 23, 2005. Mid- and small-cap stocks were hammered. News of probe into the flow of funds into Indian markets from Mauritius panicked traders, as the BSE Sensex closed down 1.89 per cent over the week at 8,223 points. The Nifty shed 2.92 per cent to 2,478 points. Among the broader indices, the S&P CNX 500 lost 3.70 per cent, while the CNX Midcap plunged 5.23 per cent over the week.

The week started on a positive note. The Indian stock markets continued their run on Monday. The 30-scrip BSE Sensex crossed 8,400 mark to close at a record high. The index gained 63.88 points to end the day at 8,444.84. The Nifty too rose 14.75 points to close at 2,576.10 mark. Mid-caps were on fire--the CNX Midcap index jumped 1.06 per cent on Monday. The rally was fuelled by banking and FMCG stocks. Oil PSUs too surged on news that they might be allowed to sell their holdings in each other. IT stocks slipped on Monday. Among the major gainers of the day included Maruti Udyog, Hindalco and ITC.

Equity markets continued to surge on Tuesday. The Sensex crossed yet another milestone, ending the day above 8,500 points. The Nifty gained 0.42 per cent to close at 2,578 points. Tuesday's rally was fuelled by technology and banking stocks. Tech majors Satyam and Infosys led from the front, gaining 2.55 and 1.99 per cent respectively. ICICI bank and HDFC Bank surged to emerge as top Sensex gainers. Sugar sector also looked quite strong- Balrampur Chini gained over 3 per cent. Bucking the trend were auto and cement stocks.

It was a turbulent day in the equity markets on Wednesday. Though the markets recovered to end almost flat, the day was marked by high volatility and sharp intra-day movement. At one point in time, the 30-stock BSE Sensex was down 239 points to 8,261. However, heavy buying in the index heavyweights helped the index recover smartly towards the end of the day. Sensex closed 13.14 points down at 8487.14 mark on Wednesday. The Nifty ended the day down 10.70 points at 2,567.30. Mid- and small-cap stocks suffered. The CNX Midcap index dipped 2.24 per cent on Wednesday.

Equity markets went into a tailspin on Thursday. Unlike Wednesday, there was no recovery towards the end of the day, as the 30-stock BSE Sensex plunged a massive 265 points to 8,221. The Nifty too lost over 3 per cent to end the day at 2476.50 points. Mid- and small-cap stocks had a disastrous day. Amid highly volatile trading and across the board selling, the CNX Midcap index skidded 4.68 per cent.

After Thursday's bloodbath, the equity markets opened on a positive note on Friday. However, choppy sessions followed, as the Sensex fluctuated in the range of 150 points. At the end of the day, the Sensex closed flat at 8,222.59 points. The Nifty too closed 1.25 points up at 2,477.75 mark. Mid- and small-cap stocks' surged--the CNX Midcap closed up 1.14 per cent. FMCG stocks were in the limelight, while the banking and PSU stocks suffered amid volatile trading.

Among the Sensex constituents, HDFC (-10.20 per cent) and Reliance Energy (-9.49) led the pack of losers. Only four stocks, including ICICI Bank (6.10 per cent), Hero Honda (2.30 per cent), L&T (0.85 per cent), and BHEL (0.24 per cent) managed positive gains.

Moving to the sector specific stocks, FMCG scrips bucked the trend and posted gains. The BSE FMCG Index closed up 2.99 per cent over the week. Technology, metal, PSU and pharma stocks lost heavily.

The combined daily average turnover on both exchanges went up by 17.55 per cent to Rs 12,339 crore. Foreign institutional investors took advantage of the slide and pumped in Rs 1,689 crore. Domestic mutual funds followed the trend and invested Rs 289 crore over the week.

Outlook
Investors had a tough last week. Similar trend is likely in the coming days. Government's scanner on penny stocks and traders will dampen the sentiments. However, there's some hope for further movement. The forthcoming second quarter results would set the direction of the markets.