Sensex catches 217-point cold

F&O sell-off trigger; Rs 60,463 crore traded.

The Sensex recorded its biggest single-day fall in more than five months on a day when the stock exchanges registered the highest ever turnover of Rs 60,463 crore.

The index slump was prompted by unusually high selling by foreign institutional investors, which sold derivatives contracts worth $359 million on Tuesday.

Metal stocks led the free fall and only some capital goods and textile scrips bucked the trend.

The BSE Sensex was down 216.82 points, or 2.02 per cent, at 10,508.85 today, after having briefly breached the 10,500 mark. The Nifty, too, was down by 66.10 points to 3,116.70, down 2.1 per cent, snapping a post-Budget rally.

"People were just surprised by the extent of FII sales," pointed out a fund manager. After having matched buys and sells in index futures on the NSE for the first four trading days of the month, data submitted to the market regulator by the exchange showed that on Tuesday FIIs had sold index futures worth Rs 1,675 crore while buying similar contracts worth just Rs 186 crore.

"The usual figures are around 8,000-10,000 contracts sold a day, matched by an equal number of purchases," he added, "but according to the new figures, the FIIs sold more than 52,000 futures contracts in the market."

Despite the sales, the total open interest on the NSE for index futures jumped by more than 13,000 contracts to 283,000 yesterday.

Large caps led the sell-off today, with 28 out of the 30 stocks on the Sensex ending in the red while the declining trend was felt less on the broader-based indices. The BSE 500 saw 77 per cent of the stocks decline, against 89 per cent on the BSE 100 and 63 per cent for the market as a whole.

The quantum of decline, too, was lower by around 20 basis points at 1.81 per cent, on the 500-stock index.

The small cap index on the BSE too fell by only 1.05 per cent, against the 2.02 per cent fall in the Sensex. Among the sectoral indices, metals fell the most with a downgrade of 4.3 per cent and was followed by the FMCG and Consumer Durables Indices.

On the NSE too, metal stocks led the fall today, with the sector accounting for all the top four losers on the Nifty. On the NSE, Tata Steel led the pack, down 5.24 per cent at Rs 443.75, followed by Hindalco at 158.55 (-5.03 per cent), SAIL (Rs 64.85, down 4.63 per cent) and Nalco (Rs 278.45, down 4.28 per cent.)

Other losers in the fifty-stock index included Maruti and VSNL, both of which fell by 3.9 percent, and Hindustan Lever, down by 3.8 per cent to 242.75. Tata Motors was another auto-scrip which fell, by 3.5 per cent to Rs 879.45.

On the top fifty stocks on the NSE, only five managed to avoid a fall today. Cipla, which gained 2.38 per cent, ended at Rs 585.15. ABB, Shipping Corporation of India and Hero Honda made gains of greater than one per cent while HDFC remained more or less unchanged at Rs 760.05.

Other prominent losers included JP Associates (Rs 464.85, down 4.67 per cent), Cummins Industries (Rs 249.25, down 4.63 per cent), Corporation Bank (Rs 367.95, down 4.47 per cent) and Reliance Capital (Rs 499.25, down 4.35 per cent.)

On the BSE, FMCG stocks including HLL, McDowell, Shaw Wallace, Dabur India, Colgate, ITC, Britannia, P&G and Nirma also witnessed selling pressure. The BSE FMCG Index closed down 2.77 per cent at 1989.29.

Consumer durables stocks like Titan Industries, Su-Raj Diamonds, BPL and Samtel Color also ended lower. The BSE Consumer Durables Index closed down 2.62 per cent at 3189.20.

Auto stocks including Hindustan Motors, Escorts, Ashok Leyland, Cummins, Maruti, Tube Investment, Tata Motors, M&M and Bajaj Auto lost ground. The BSE Auto Index closed down 1.84 per cent at 5240.74.

Among textile scrips, Bombay Dyeing rose 3.6 per cent to Rs 489.9 and Dawn Mills gained 5 per cent at Rs 4,658.55.

Reliance Natural Resources surged 19.8 percent while Reliance Communications Ventures fell 2.7 per cent.