Sensex down 137pts at one-week low as Budget optimism subsides

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Photo: PTI
Photo: PTI

Mumbai, Jul 9 (PTI) : The benchmark Sensex on Wednesday fell 137.30 points to end at over one-week low of 25,444.81 on concerns highlighted by the Economic Survey and diminishing expectations from the Narendra Modi-led government in its maiden Union Budget on Thursday.

Weakness in global equities also dampened the sentiment.

“After slight disappointment from the Rail Budget, the market prices today reflected investors’ diminishing expectations for strong measures from the government in tomorrow’s Union Budget,” said Rakesh Goyal,Senior Vice President, Bonanza Portfolio.

Auto, power, realty, pharma, capital goods and IT shares were at the receiving end while refinery, consumer durable and FMCG counters attracted good buying support.

The BSE 30-share barometer resumed better and moved erratically in a range of 25,683.97 and 25,364.77. It ended at 25,444.81, showing a fall of 137.30 points or 0.54 per cent.

On Tuesday, it fell 517.97 points, or 1.98 per cent, logging its biggest single-day drop in ten months. Today’s Sensex closing value is the lowest since 25,413.78 (June 30).

The Economic Survey 2013-14 presented by Indian Finance Minister Arun Jaitley in Parliament said GDP growth is seen at 5.4-5.9 per cent in 2014/15. It also called for fiscal consolidation through higher tax-GDP ratio and subsidy reforms.

“Before the Union Budget, investors took note of Economic Survey which highlighted inflation & growth concerns. And, preferred to book some profits off the table and wait for further clarity,” said Jayant Manglik, President-retail distribution, Religare Securities.

The 50-issue NSE Nifty declined further by 38.20 points, or 0.50 per cent, to over 1 week-low of 7,585.

Fall in the index-based counters like TCS, Tata Motors, L&T, ICICI Bank, Infosys, M&M, HDFC, Bajaj Auto and Maruti Suzuki mainly contributed to the Sensex slide.

Asian stocks ended lower triggered by concerns that equity valuations are too high. European indices were trading lower in early trade.

Key benchmark indices in China, South Korea, Taiwan, Hong Kong, Singapore and Japan were down by 0.24 per cent to 1.55 per cent.

In Europe, indices in France, Germany and the UK were seen trading 0.02 per cent to 0.60 per cent lower in trade.

Back home, 19 scrips out of the 30-share Sensex ended lower while 11 others finished higher.

Major losers were Bajaj Auto (3.12 per cent), Coal India (2.97 per cent), Maruti Suzuki (2.70 per cent), M&M (2.54 per cent), Tata Power (2.47 per cent), Tata Motors (2.46 per cent), TCS (2.14 per cent) and Hero MotoCorp (1.53 per cent).

NTPC (1.47 per cent), Cipla (1.39 per cent), Wipro (1.37 per cent) and L&T (1.24 per cent) also closed lower.

However, ONGC rose by 1.77 per cent followed by ITC 1.67 per cent, Gail 1.26 per cent and Hindalco 1.21 per cent among Sensex gainers.

“The survey highlighted lower inflation, fiscal reforms, changes in the regulatory framework, a national agriculture market, financial sector reforms and subsidy rationalization… recommendations are all practical from an economics perspective. However, the budget announcements will also have to take the political viewpoint into account,” said analysts Sonal Varma and Aman Mohunta of Nomura.

Among the S&P BSE sectoral indices, Auto fell by 2.43 per cent, followed by Power 1.69 per cent, Realty 1.60 per cent, Capital Goods 1.47 per cent, Healthcare 1.44 per cent, IT 1.31 per cent and Teck 1.22 per cent.

Mid-cap and small-cap indices also dropped further by 1.44 per cent and 1.82 per cent respectively on persistent selling from retail investors.

Market breadth continued to show negative trend as 2,088 stocks finished with losses while 891 stocks ended higher.

Total turnover fell to Rs 3,849.79 crore from Rs 4,295.79 crore on Tuesday.

Meanwhile, Foreign Portfolio Investors (FPIs) bought shares worth a net Rs 422.72 crore on Tuesday, as per the provisional data from the stock exchanges.

 

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