The weakness became a slide today as the indices posted the third straight day of losses. After opening weak the market slipped throughout the day and closed almost at the lows of the day. Sensex closed at 6498, down 82 points and the Nifty at 2008, down 23 points.

Among index stocks Punjab National Bank, HDFC Bank and Bajaj Auto were the biggest percentage gainers while Nalco, Satyam Computers and L&T were the major losers.

On Friday, US markets declined even as oil dropped to $53.32 to a barrel. The sharp fall in oil futures led to a weakness in oil stocks which have a large weight on the indices. However, the fear of a rebound in oil prices is keeping the rest of the market also weak. An earnings downgrade from General Motors and Ford Motors also led to the weakness. The weak US closing had its impact on other Asian markets as well, all of which opened in the red today.

Centre for Monitoring Indian Economy (CMIE) released its forecast for the Indian economy for FY 2005-06. The think tank expects the economy to grow by 6.6 per cent on the back of an improved performance by agricultural sector which is expected to grow 3.1 per cent. Industry growth is expected to be marginally higher at 8.5 per cent as against the 7.3 per cent of FY 2004-05 while services sector growth is projected to decline to 7.5 per cent from 8 per cent.

The Centre for Mathematical Modeling and Computer Simulation expects above normal monsoons in June which may lead to flooding. The research institute expects the monsoon to hit the Kerala coast on 26 May.

Power equipment major ABB recovered from its morning weakness on news of an order received by the company's parent ABB of Sweden from NTPC and Powergrid. The order, worth $80 million, is for supply of transformers and transmission equipment. ABB India is expected to get a part of the contract and maintenance contracts in future. The stock closed with gains of over a per cent.

Tata Motors gained a percent in morning trade on reports that SREI Infrastructure Finance has signed an agreement for 10,000 vehicles. Further details were not available. The stock could not hold on its early gains.

Global rating major Standard & Poor increased the offer price for Crisil from Rs680 to Rs775 per share. The offer is conditional on S&P receiving at least 51 per cent stake in Crisil, including the stake it already holds in Crisil. S&P has also increased the size of its offer from the earlier 55 per cent to 65 per cent. The stock gained more than 8 per cent to touch a new yearly high in morning trades.

LIC of India, one of the largest stake holders in Crisil, is discussing with UTI, another stake holder, on whether to accept the offer. Meanwhile, LIC has decided to accept the open offer by Holcim for ACC shares.

Jet Airways is entering into a marketing tie-up with South African Airways. Jet will lease wide bodied aircraft from the South African airline for its international operations. Jet has increased domestic fares by 12 per cent to offset the aviation fuel price hike.

All the four frontline tech stocks lost ground as the market is becoming increasingly doubtful of the technology outlook. Satyam Computers, Infosys and TCS all lost more than 2 per cent each while Wipro lost close to 2 per cent.

Bata India gained close to 20 per cent in early trades after the news of a rights issue at a substantial discount to the existing market price. The rights issue in the ratio of one share for every four shares held will be at a price of Rs54 per share.

The board of Ugar Sugar is to consider a plan for stock split in the near future. The stock was locked in its 2 per cent upper circuit in early trades. The company had recently announced a bonus issue as well.

Electric lighting and fixtures manufacturer Asian Electronics gained more than 5 per cent in early trades after the company announced a tie up with a US company to supply lighting and fixtures. Under the agreement, the company will manufacture products under the Westinghouse brand for sales in South Asian markets including India for the next five years.

Dolphin Offshore is planning to set up a joint venture with a Singapore based company to offer risk management and inspection services in the country.

CG Igarshi Motors, Gruh Finance and Gujarat Fluorochemicals were the biggest percentage gainers among mid-caps.

Herdilia Chemicals, Vesuvius India and Rajastan Spinning & Weaving were among the biggest percentage losers among mid-caps.

*Disclaimer: The author does not have any position in the stocks specifically mentioned above at the time of writing this article. This analysis / report is only for the purpose of information and is not an investment advice. Readers are advised to consult a certified financial advisor before taking any investment decisions. While efforts have been made to ensure the accuracy of the information provided in the content the author or publisher shall not be held responsible for any loss caused to any person whatsoever.

Other articles by Rex Mathew

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List of general reports on finance