Nifty ends at 4251 on large volumes; infra, commodities drag

18 June 2009

It was another scary session for the markets led by huge profit booking in infrastructure, commodities and realty stocks. The sell-off was accompanied by huge volumes, which crossed the Rs 1-lakh crore mark. The broader largecap Index Nifty 50 closed just above the 4250 level after seeing an intraday low of 4222.15.

Nitin Raheja, CIO of Rada Advisors Pvt Ltd said, "Unless the Nifty crosses 4,100, I would believe that we are yet in that range." However, he said 4100 could not be ruled out at the end of day. "This has been a flow driven market; we have seen strong FII (Foreign Institutional Investor) flows in the last 1.5 months which is been responsible and what we are seeing in the last couple of days has been the reverse. If it crosses 4,100 then we are going to be slowly covering that entire gap that we had on the 18th May."

Some largecaps saw more than 8% cut in today's trade. Fresh shorts build-up and follow-up unwinding were other reasons for the markets' downfall. ONGC, NTPC, SAIL, Tata Steel, BHEL, L&T, ICICI Bank and Reliance Communication were the negative contributors. However, there was some support seen from SBI, Bharti, Infosys, Hero Honda, Axis Bank, Sun Pharma, Tata Motors, BPCL and PNB.

The 30-share BSE Sensex fell 1.77% or 257.31 points, to settle at 14,265.53, after seeing an intraday low of 14,188.25. The NSE Nifty 50 closed at 4251.40, down 2.4% or 104.75 points. Among the broader indices, the BSE Midcap Index slipped 144.21 points or 2.87%, to 4,876.86 and the Smallcap Index fell 3.7% or 214.10 points, to 5,572.44.

The Nifty futures added about 35 lakh shares in open interest (OI) and saw a turnover of more than Rs 15,000 crore. Nifty Open Interest PCR (put-call ratio) declined further to 0.88; 4300 Call added 13 lakh shares and 4,400 Call added 10 lakh shares while 4,200 Put added 10 lakh shares in Open Interest.

Sectoral indices
Rahul Mohindar of viratechindia.com said, "We are probably going to head down to something like 4100-4120 from here before we can see the next patch of recovery."