Nifty ends at 7-month lows; ONGC nosedives

Indian equity benchmarks closed at seven-month lows on Tuesday and underperformed the global markets by shedding more than 260 points on the Sensex. The Nifty managed to hold the 5300 level as it touched an intraday low of 5,303.40, dragged down by almost all sectors.

Traders looked more nervous after looking at the options data. The Nifty February 5100 put saw huge addition in open interest - about 33% - with the feeling that there would more downside going ahead.

Abhijit Chakraborty, Senior VP - Institutional Equity, Fortune Financial sees the Nifty slipping to 5,150-5,200 and the Sensex falling to about 17,500. ''I think there is downside in the market. Fundamentally, I would say the market should bottom out somewhere around 13.5-14 times its FY12 estimated earnings. So, that way on the Nifty, we are looking at anything between 5,150-5,200 levels and about 17,500 on Sensex. At those levels, it would be an attractive buying opportunity for the market as a whole,'' he adds.

Arjuna Mahendran, managing director, head investment strategy-Asia at HSBC Private Bank feels that investors are a bit nervous about emerging market companies and their earnings profile because of these cost pressures from wages, from interest rates and also from raw material prices. "Those pressures are not affecting companies in the West and that's why the US stock market for instance is going gangbuster right now," he said.

Oil & gas, financial, auto, infrastructure, metal and Anil Dhirubhai Ambani Group companies' shares were the prominent sectors which took huge beating on exchanges today. However, Bajaj Auto, Infosys, Tata Power, Hindalco, Siemens, Cipla and BPCL were only gainers on Nifty.

The 30-share BSE Sensex closed at 17,775, down 261 points and the 50-share NSE Nifty fell 83 points to 5,312, after hitting intraday lows of 17,742.18 and 5,303.40. The broader indices saw more sell-off as compared to benchmarks - the BSE Midcap Index was down 2.4% and Smallcap down 3.2%.