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Markets Lose Further

Sensex closed 1.62 per cent down at 8,069 points over the week. The Nifty shed 1.64 per cent to 2,444 mark. Among the broader indices, the S&P CNX 500 slipped 2.82 per cent

Equity markets lost further in the week ended October 21, 2005. While the BSE Sensex closed 1.62 per cent down at 8,069 points, the Nifty shed 1.64 per cent to end the week at 2,444 mark. Among the broader indices, the S&P CNX 500 slipped 2.82 per cent. Mid-cap stocks lost even more with the CNX Midcap skidding 3.84 per cent over the week.

The sentiments were subdued almost throughout the week. Equity markets ended flat after a volatile trading session on Monday. The Sensex touched an intra-day high of 8,254 and an intra-day low of 8,131 before ending at 8,202.62 points, up just 0.01 per cent. The Nifty too ended flat at 2,485.15 points. Mid-caps lost ground as the CNX Mid-cap index shed half a per cent before ending at 3,661.35 points.

After a breather on Monday, equity markets continued to descend on Tuesday. The markets opened strong as the Sensex touched an intra-day high of 8,317 points. However, mid-way during the trading session markets slipped in red and the Sensex ended the day at 8,122 points, down one per cent. The Nifty too shed 0.7 per cent to close at 2,468 points. Among the sectoral indices, only two managed to end in the positive territory- BSE Capital Goods index and BSE FMCG index. BSE IT index lost the most, shedding 1.8 per cent.

Bears further tightened their grip on equity markets on Wednesday. Markets continued to witness widespread selling as the Sensex closed below the 8,000 mark losing 1.86 per cent. In the broader markets, the Nifty shed 2.26 per cent to end at 2,412 points. Dr Reddy's Lab and Hero Honda led the pack of losers as they both lost in excess of 4 per cent. Only three Sensex stocks- Satyam Computers, ICICI Bank and ACC ended in green, clocking gains of less than one per cent. All the sectoral indices ended in red. BSE Metal index emerged as the biggest loser, shedding 3.5 per cent.

After a positive start, equity markets dipped towards the end of the day on back of profit booking on Thursday. The 30-stock BSE Sensex touched a high of 8,134 points during early trades but dipped sharply thereafter to close at 7,935 level, down 36 points over the day. The Nifty shed 17 points to close at 2,395 mark. Mid-cap stocks were under pressure as the CNX Midcap slipped 1.41 per cent. Barring IT stocks, most counters ended the day in the red.

The Indian stock markets reversed their three-day losing streak to stage a strong comeback on Friday on some positive news related to easing of norms for foreign ownership in telecom firms and TV news channels. Finance Minister's statement that foreign fund flows were likely to remain robust added to the positive sentiments, as the 30-stock BSE Sensex zoomed 134 points to close at 8,069 level. The Nifty also surged 48 points to end the day at 2,444 mark. Mid-cap stocks rallied too, with the CNX Midcap gaining 1.38 per cent. FMCG stocks attracted heavy buying interest.

Among the Sensex constituents, 17 stocks lost over the week. Leading the pack of losers was Ranbaxy Laboratories, which slipped a massive 12.04 per cent over the week after the company saw its net profit down 90 per cent in the third quarter from the corresponding period last year. Grasim Industries (-8.10 per cent) and Dr Reddy's Laboratories (-7.28 per cent) were also among the top losers of the week. On the contrary, auto major Hero Honda Motors gained 8.02 per cent over the week.

Among the sectoral indices, BSE Healthcare Index lost a massive 5.89 per cent, followed by 4.74 per cent slide of the BSE Metal index. BSE PSU too slumped 3.91 per cent.

The combined daily average turnover on both exchanges rose 19.41 per cent to Rs 9,682 crore in the week ended October 21, 2005.

Foreign institutional investors (FIIs) continued their selling spree and booked profits worth Rs 498 crore over the week. Domestic mutual funds, however, found the markets attractive and bought shares worth Rs 1,173 crore.

Volatility is likely to continue in days to come. FIIs are on a selling spree. Their support is crucial for the markets to move further up from hereon. Heavy investments by domestic mutual funds is a positive sign. Some good corporate results in days to come might reverse the trend.