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Correction Course

Markets underwent a minor correction on back of selling pressure and SEBI crackdown on 24 market players for their role in alleged manipulation of initial public offerings

Markets underwent a minor correction on back of selling pressure and SEBI crackdown on 24 market players for their role in alleged manipulation of initial public offerings. After volatile trades, the 30-stock BSE Sensex dipped 178 points or 1.48 per cent to sign off the week ended April 28 at 11,852 levels. The Nifty closed down 1.81 per cent at 3,508 mark. Among the broader indices, the S&P CNX 500 lost 0.68 per cent, while CNX Midcap added 0.98 per cent.

Profit booking dragged the markets down on Monday. Rising crude prices and a weak monsoon forecast added to the worries. The BSE Sensex dropped over 115 points through the day. Tech stocks lost heavily after Satyam Computers came out with a disappointing forecast.

Markets plunged on Tuesday. Investors resorted to heavy selling after the recent run up. Weak Asian markets too contributed to the fall. The Sensex dipped 268 points to close at 11,647 levels. However, the fall reversed on Wednesday when the markets staged a strong comeback. After two successive falls under selling pressure, buyers helped the Sensex take an about-turn. The index rose a massive 292 points to close at 11,938 levels. Strong results of car maker Maruti and ample liquidity added to the positive sentiments.

Weakness returned on Thursday as Reliance Industries results failed to enthuse investors. After a strong opening, the Sensex lost heavily towards the end of the day to close 103 points down at 11,835 levels.

Extreme volatility prevailed on Friday, the day SEBI barred 24 market players from trading. Investors mistook the SEBI order and felt that the players had been barred from servicing their clients as well. And before SEBI could come out with clarification, the Sensex had tumbled to a low of 11,344 points, down nearly 500 points. However, SEBI clarification that its order banning the 24 players would apply only to transactions carried out in the proprietary account of brokers, restored order. The Sensex made recovery and finally ended the day up 17 points at 11,852 levels.

Among the 30-Sensex stocks, only six managed to end the week in the positive territory. The pack of losers was led by 7.28 per cent fall in Satyam Computers that disappointed investors with a weak earning forecast.

Among the sectoral indices, BSE IT lost 4.57 per cent, followed by 2.94 and 2.84 per cent decline in BSE Bankex and BSE Healthcare. BSE FMCG managed a 1.61 per cent gain.

The combined daily average turnover on BSE and NSE went up 8.88 per cent to Rs 15,898 crore in the week ended April 28. The FIIs returned to the markets and invested over Rs 2,145 crore, while domestic mutual funds pumped in Rs 1,144 crore over the week.