Mkts shocked on rising oil; Sensex, Nifty end down 4%

Markets have completely washed out all indices in an intraday trade though some recovery has happened in late trade, which seemed like value buying at lower levels. Weak global cues on the back of rising crude have worrisome effect on our markets as well. Sensex and Nifty again test 13000 and 3900 levels, respectively in today's session. Realty, metal, banking, power, telecom, auto and capital goods stocks slaughtered severely.

Markets sources say that intraday recovery was largely on back of short covering. However, political uncertainty is keeping investors wary of putting fresh money in the markets. Redemption led sell off by hedge funds continued. Selling pressure will continue in midcap and small cap stocks.

Dealers feel that redemption pressure in domestic funds could be the last leg of capitulation.

The Sensex has touched an intraday low of 12,934.92, down 729.7 points or 5.34% over its previous close. It was down 570.51 points or 4.18% at 13,094.11.

Nifty Fifty crashed 218.5 points or 5.34% while hitting an intraday low of 3874.85. It finished at 3925.75, down 167.6 points or 4.09%.

Technical analyst said Nifty support is at 3850 in near term and the worst is not over yet.

Nifty July Futures seen fresh shorts in today's trade, discount widened to 55 points. Long unwinding has seen in momentum stocks after yesterday's build up. Aggressive shorts built up in private banking and metal stocks.

Reliance Industries, DLF, SAIL, Bharti Aitel, ICICI Bank, Tata Steel, Infosys, ITC and HDFC were top contributors in draggers' list.

Market breadth was weak; about 858 shares have advanced while 2039 shares declined. Nearly 239 shares remained unchanged on the BSE.

Crude August Futures hit an all-time high of $ 145.65 a barrel on the NYMEX and is inching up towards $146/bbl. Saudi Oil Minister says pessimism over world supply is one of the reasons for spike in crude oil prices.

Petroleum Secretary MS Srinivasan said demand for crude would increase by 5-7% in 2008-09, reports CNBC-TV18. "India FY09 crude import bill seen at USD 110-120 billion, as against USD 68 billion last year." According to Srinivasan, the country's fuel demand depends on pricing policy. India is still an attractive destination for global upstream companies.

Amongst frontliners, Tata Steel plunged 11.3%, Suzlon Energy -10.08%, DLF -9.93%, Unitech -9.74%, SAIL -9.51%, Reliance Infra -8.72%, ICICI Bank -7.89% and Reliance Communication -6.91%. However, SBI gained 2.07%, ABB 0.91%, ONGC 0.56% and BPCL 0.56%.

Metal was the hugely beaten down sector, crashed 1,125.47 points or 8.5% at 12,113.55. Guj NRE Coke, Tata Steel, SAIL, Jindal Steel, JSW Steel and Sterlite Ind slid 8-13.5%.

Realty Index has wiped out all its yesterday's gain, down 435.97 points or 9.21% at 4,295.22. Realty stocks like Sobha Developer, Unitech, DLF, HDIL, Anant Raj Ind, Omaxe, Indiabulls Real, Phoenix Mills and Akruti City fell 8-10%.

Power stocks like Suzlon Energy, Tata Power, Reliance Infra, GMR Infra, Neyveli Lignite, Lanco Infratech, GVK Power and NTPC plummeted 4-10%. Index was down 106.58 points or 4.67% to settle at 2,173.63.

Bankex lost 271.84 points or 4.59% at 5,647.79. Banking stocks like Kotak Mahindra, Karnataka Bank, Axis Bank, Yes Bank, ICICI Bank, IndusInd Bank, Canara Bank, Allahabad Bank and HDFC Bank fell 3.5-11%.

Amongst telecom stocks, Tata Comm, Idea Cellular, Reliance Comm, Bharti Airtel, MTNL and Tata Teleservices plunged 3-8%.
 
FMCG Index was down by 80.54 points or 4.03% at 1,918.61 due to selling pressure in United Spirits, Dabur India, ITC, United Breweries and Godrej Consumer, which declined 4-6.6%.

Auto stocks like Bajaj Auto, Amtek Auto, Escorts, Tata Motors, Tube Investment, Maruti Suzuki, Exide Industries and Cummins skid 4-10%. Index tumbled 120.29 points or 3.44% at 3,377.76.

IT Index fell 139.13 points or 3.33% at 4,038.62 as selling pressure seen in HCL Tech, Mphasis, Infosys, Tech Mahindra, TCS, Satyam and Wipro, which were down by 2-8%.

Capital goods stocks also plunged 2-8%, such as Punj Lloyd, Gammon India, Walchandnagar, Bharat Bijlee, Rel Ind Infra, Siemens, Alstom Projects, L&T and BHEL. Index dropped 310.86 points or 3.01% at 10,007.28.

In the oil and gas space, Essar Oil fell 7.20%, RNRL -6.17%, Petronet LNG -5.17%, GAIL -4.12%, Reliance Ind -3.36% and Cairn India -1.70%. Index was down by 272.82 points or 2.97% at 8,922.47.

Healthcare Index slid 1.43% at 4,107.58 on the back of weakness in Opto Circuits, Glenmark, Wockhardt, Sun Pharma Adv, Matrix Labs and Divis Labs.

BSE Midcap Index closed at 5,161.76, down 149.54 points or 2.82%. Amongst midcap stocks, Guj NRE Coke, UB Holdings, Madhucon Projects, Prakash Ind, Simplex Infra, Tanla Solutions, Ashapura Mine, Adlabs Films and Sobha Developers plunged 10-13.5%

Small Cap Index fell 157.63 points or 2.42% at 6,349.17 as Lok Housing, Kirloskar Ferro, BAG Films, Sanghvi Movers, Ahmednagar Forg, Prajay Engineer, Ganesh Housing, Kolte-Patil, Sasken Comm and Sunil HitechEng tumbled 10-17%.

Most active counters on the bourses were Reliance Capital, Reliance Ind, Reliance Infra and ICICI Bank.

Turnover traded by the markets stood at Rs 70067.28 crore. This includes Rs 12824.57 crore from NSE Cash segment, Rs 51604.28 crore from NSE F&O and the balance Rs 5638.43 crore from BSE Cash segment.

On the global front, Asian markets ended mixed. Hang Seng fell 2.13%, Jakarta Composite -3.86%, Nikkei -0.16%, Straits Times -1.43% and Kospi -1.05%. However, Shanghai gained 1.95% and Taiwan Weighted 0.55%.

European markets were trading lower as experts feel that European Central Bank is likely to increase interest rates by 25 basis points to control inflation. At the time of writing market report, FTSE 100 was down by 0.5%, CAC and DAX fell 0.7% each.

Markets Snapshot

• Markets slide as crude hits yet another life time high
• Sensex ends down 570.5 pts at at 13094; Nifty down 168 pts at 3925.75
• CNX Midcap Index down 2.8% ; BSE Small-cap Index down 2.4%
• All BSE Sectoral Indices end in the red
• BSE Metals Index down 8.5%;  Tata Steel down 11%, Sail down 9.5%,
• BSE Realty Index down 9.21%; Unitech down 9.7%, DLF down 9.6%;Indiabulls Real Estate down 9.4%
• Bank stocks witness some contrarian buying ahead of inflation data on Friday
• BSE Bank Index down 4.5%;  SBI gains 2%; Union Bank up 5%
• Index Losers; Suzlon Energy down 10%; Tata Power down 8.6%; Tata Comm down 8.23%: Sterlite Inds down 8%; HCL Tech down 6.8% 
• Relisting : Avon Weighing gains 19% on listing day; closes at Rs 11.9
• Other Losers; Gujarat NRE Coke loses 13.4%; Adlabs down 11%; IDFC down 10.2%; Suzlon down 10% 
• NSE Advance Decline at 1:4
• Total F&O turnover at Rs 51604 cr Vs Rs 57532.76 cr; 
• Total market turnover at Rs 70067 Vs Rs 79632 cr cr yesterday
• Heavy Losers
  Treadsdirect loses 19%
  GMR Ferro Alloys loses 17%
  Prajay Engineers down 13.36%
• Buzzers
  Archies up 11.26% on talks of acquisition by Videocon group
  Mercator Lines up 8%
  Usha Martin up 6.5%
  Triveni Engg up 5.2%

F&O Snapshot

• Nifty Fut sees fresh shorts in todays trade; discount widens to 55 points
• Long Unwinding seen in momentum stocks after yesterdays build up
• Pvt Banking & Metal Stocks sees aggressive short build up
• NSE FNO turnover lower at Rs 51604 cr vs 57532.76 cr in yesterday’s trade
• Nifty 4000 put sheds 2.9 lakh shares
• Nifty 4100 put sheds 1.8 lakh shares
• Nifty 3700 put adds 9.8 lakh shares
• Nify 4000 call adds 4 lakh shares
• Aggressive Shorts
  Sail dn 12%; adds 26.8 lakh shares
  IDFC dn 11.6%; adds 21.5 lakh shares
  Idea dn 7.7%; adds 10.8 lakh shares
  ICICI Bank dn 9%; adds 7.1 lakh shares
  Naga Fert dn 11.3%; adds 7 lakh shares
• Long Unwinding
  IFCI dn 10.3%; sheds 20 lakh shares
  Ispat dn 7.9%; sheds 19.3 lakh shares
  TTML dn 4.4%; sheds 5 lakh shares
  Essar oil dn 8.4%; sheds 4.2 lakh shares
  Neyveli Lignite dn 9%; sheds 3.7 lakh shares

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