Indices correct on profit booking and weak global markets

05 October 2005

Weak global markets and negative FII inflow figures for last Thursday and Friday led to nervousness among traders and the markets corrected after two days of strong gains. The frontline indices had gained 7 per cent each over the last seven trading sessions and the markets were ripe for some profit booking.

After opeing in the red, the markets recovered within minutes and jumped back into positive territory. However, the indices declined again and traded sideways for close to an hour when reports of good purchases by FII's on the derivatives segment yesterday came in. The indices regained lost ground by noon before another sharp decline took them deeper into the red.

The indices traded within a range for most of the afternoon. A brief rally in the last hour attracted more selling and pulled down the indices to the day's lows.

ICICI Bank was the biggest loser among the index stocks, closing almost 5- per cent lower. ITC, which had seen strong buying over the last two weeks, also declined and closed almost 4-per cent lower.

FMCG stocks were the worst hit among all sectors as most of them closed with major losses. HLL lost close to 2 per cent. Dabur lost close to 3 per cent and Colgate closed with losses of over a per cent.