BSE Sensex drops 500 pts in 2 days; ends below 200 DMA

It was carnage on Dalal Street with BSE Sensex shedding over 500 points in two trading sessions. Political uncertainty, ETF funds and FII selling and ever-worsening economic data are the key triggers for the downfall.

The Sensex closed at 18509, down 292 points or 1.55 percent and the Nifty ended at 5574, down 98 points or 1.73 percent.

The benchmark indices have closed below their 200-Day Moving Averages for first time since August 2012, which is a bearish sign.

A fall below this average indicates breach of support and market participants consider closing their long positions inferring the long term trend has turned bearish. 33 stocks in the Nifty are trading well below its 200 DMA.

Foreign funds sold shares worth 3.68 billion rupees on Wednesday, provisional exchange data shows. FIIs continue to be big buyers of Indian stocks in 2013, having bought over $10 billion. A sharp sell-off by FIIs can drag market to lower levels.

Realty stocks were biggest losers of the day. BSE realty index ends the day with losses of 3.24 percent. DLF loses 4 percent, Sobha Developers down 5.5 percent, HDIL down 5.3 percent.

IT stocks took a u-turn in trade today. After gaining 24 percent in the March quarter, the index was down 2.45 percent today.

The cuts got deeper in the late afternoon trade. The Sensex slumped 305.06 points to 18496.58 while the Nifty plunged 105.00 points at 5567.90.

Cement, technology and banks were among the big losers. The cuts were much larger in the broader market space. High beta stocks take a big hit and infra too is under pressure.

In the money market, the rupee has also touch fresh one month low in sync with the global dollar strength that has weakened all Asian currencies. Heavy sell-off in the equity market is also accentuating rupee's fall.

DLF was down 2 percent on reports of the company seeking shareholders' nod to raise fresh equity. Sources told CNBC-TV18 that realty major may announce sale of wind business for around Rs 300 crore today.

Mangalore Chemicals was down 4.5 percent today. The stock is up 47 percent in last three trading sessions on buzz of takeover.

KFA is down 2.5 percent. The pilots & engineers of the company will protest at Chinnaswamy stadium today 5 pm.

Sugar stocks like Shree Renuka, Bajaj Hindustan & Dhampur Sugar are buzzing in trade today. Cabinet may take up sugar decontrol agenda today.

The benchmark index Nifty has hit fresh 4-month low on political uncertainty and buzz of ETF funds liquidating portfolios. The volumes are also on higher side suggesting fresh short positions and delivery based selling in the market.

The Sensex is down 250 points at 18552 and the Nifty is down 86 points at 5587.

In the money market, the rupee has also touch fresh one month low in sync with the global dollar strength that has weakened all Asian currencies. Heavy sell-off in the equity market is also accentuating rupee's fall.

Japan's Nikkei average jumped 2.2 percent to a two-week high in heavy trade on Thursday after the Bank Of Japan announced a sweeping monetary expansion campaign that will include heavy investment in REITs and ETFs, boosting reflationary stocks such as real estate firms and banks.

Supreme Court has deferred hearing in PNGRB versus Indraprastha Gas Ltd case to April 16. The case was deferred as gas company seeks time.

DLF is down 2 percent on reports of the company seeking shareholders' nod to raise fresh equity. Sources told CNBC-TV18 that realty major may announce sale of wind business for around Rs 300 crore today. 
 
Mangalore Chemicals is down 4.5 percent today. The stock is up 47 percent in last three trading sessions on buzz of takeover.
 
KFA is down 2.5%. The pilots & engineers of the company will protest at Chinnaswamy stadium today 5 pm.

Hexaware has signed contract with one of its US-based existing clients. The stock is up 1 percent.
 
Redington is slapped with Rs 138 crore tax charge by IT department. The tax on imputed profits on transfer of its 100 percent shareholding in Redington Gulf FZE to wholly-owned subsidiary Redington International (Holdings) Limited in 2008-2009.
 
Sugar stocks like Shree Renuka, Bajaj Hindustan & Dhampur Sugar are buzzing in trade today. Cabinet may take up sugar decontrol agenda today.

The market was under heavy selling pressure as the Nifty sunk below 5600 for the first time since November 23, 2012. The Sensex plunged 218.60 points to 18583.04 while the Nifty fell 74.50 points to 5598.40.

Cement, technology and banks were the big laggards of the day.

IT stocks like Infosys (down 2.2 percent) and TCS (down 1.8 percent) reacted on negative economic data in the US which was the biggest outsourcing market for the Indian IT firms. HCL Tech slipped around 3 percent.

Dhanlaxmi Bank was losing as the company raised Rs 70 crore through the QIP route by offering 1.5. cr shares at Rs 46.50 rupees a share

Coal India was excited as the government has asked the company to buyback 5 percent. The stock was up 2.35 percent on the BSE.

Meanhwhile, pharma stocks were seeing some buyers' interest. Dr Reddy Lab gained 2. 9 percent while Aurobindo Pharma was up 1.9 percent.

Other gainers in the Sensex included Coal India, Tata Motors, Maruti Suzuki and HUL.

In the money market, the rupee is close to one month lows in sync with the global dollar strength that has weakened all asian currencies. Initial impact of the Bank of Japan quantitative easing is also seen as weakening the yen and other Asian currencies.

The Nifty is down 0.83 percent at 5,624.75, below the 200-day moving average which was at 5,638. The benchmark Sensex is down 0.98 percent.

Continued domestic political uncertainty and worries about early elections after the withdrawal of a key regional ally from the ruling coalition last month are weighing on investor sentiment.

Developments in the Korean peninsula and US jobs data due on Friday may signal slowing US growth.

Rahul Gandhi, promoted by many as the Congress' likely next prime ministerial candidate is addressing the India Inc at CII summit.

Key Takeaways

• Indian industry has done tremendous job over past few years
• Politics of alienating communities affects growth
• The government alone cannot build infrastructure
• Our problem is the lack of training and skills
• There are some problems that need exponential solutions; whenever India has done well it has done so not by incremental change but by radically altering structures
• I have come here to forge a long-term partnership with you to take this country forward
• India cannot go forward without working together
• Let us build brave new empowered India together

Foreign investors were provisional net sellers worth 3.68 billion rupees of stocks on Wednesday, exchange data showed.

Indian banks' advances grew at a slower pace in 2012/13 compared with a year earlier, and fell short of the central bank's projection, hurt by lower demand for credit from companies in a slowing economy.

ICICI Bank is down 1.42 percent, HDFC Bank is down 1.3 percent while State Bank of India is down 1.3 percent.

Technology share also fell tracking weak US equities. Infosys shares fall 1.1 percent while Tata Consultancy Services is 1.1 percent lower.

The March quarter proved to be good for IT stocks. The BSE IT index rose 24 percent outperforming the benchmark indices.

Indian market continued its southward journey. The Sensex was down 126.05 points at 18675.59, while the Nifty slipped 44.30 points to 5628.60.

Bank, realty, technology and metals were dragging the indices.  Infosys, HDFC, Tata Steel, TCS and Hero MotoCorp were the biggest losers on the Sensex.

DLF was down around 1.4 percent as the stock is reacting to a CNBC-TV18 exclusive story that it may announce a wind business sale of Rs 300cr today and sell its wind assets in Tamil Nadu and Rajasthan.

BHEL also lost around 1.4 percent as Ambit has retained its sell stance on the stock and cut earnings estimates for FY14 and FY15 by 3-19 percent with a target price to Rs 159 per share.

Meanwhile, auto stocks snapped off losing streak and were big gainers in the Sensex. Tata Motors and  M&M were up around 1 percent.

Indraprastha Gas (IGL) was up 2 percent ahead of the Supreme Court hearing on the IGL-PNGRB case is today . This is with reference to pngrb order dated April 09, 2012 to IGL regarding a cut in network tariff and compression charges on sale of PNG and CNG.

Earlier Delhi High Court had earlier ruled in favour of IGL and if SC upholds the HC decision , it will be a big boost for IGL.

Globally, Nikkei has recovered more than 1 percent from days lows as Bank of Japan launched a strong easing campaign under new leadership. BoJ will increase Japanese government bond holdings at annual pace of 50 trillion yen , will increase monetary base at annual pace 60-70 trillion yen.

Benchmark indices were under pressure in early trade Thursday, with realty and capital goods shares figuring among the key laggards.

The Sensex was down 185 points at 18616, and the Nifty was down 60 points at 5612.

Brokers said the biggest worry right now is the slowdown in foreign fund flows.

With market operators and high networth individuals having lost heavily in the midcap carnage over the last couple of months, there were no strong hands to absorb selling by foreign funds, they said.

Market breadth was negative with declining stocks outnumbering gainers nearly 4 to 1.

Adani Power shares were flat after gaining around 9 percent on Wednesday. Investors are worried that State Electricity Boards may contest the CERC order awarding a tariff compensation to the company.

After a steady performance in the last few sessions, midcaps once again are being targeted by bears. Core Projects, HDIL and Opto Circuits were down 2-3 percent.

Gainers included M&M Financial Services, GAIL, Indraprastha Gas and Crompton Greaves, up 1-2 percent.