Sensex slides 138 points

Stock markets saw a swing of 181 points, finally ending the day in the red.

After bouts of selling yesterday, the market on Tuesday witnessed another round of selling, largely by domestic funds.

The Sensex opened flat at 9,584, and inched up to a high of 9,600, but thereafter the sentiment turned negative. Stocks continued to head downwards through the day and the index finally ended 1.44 per cent, or 138 points, lower at 9,445.

The 50-share Nifty was down 1.35 per cent or 39 points and closed at 2,871. Dealers said the market had built in huge expectations ahead of the third quarter results and players were consolidating their position ahead of market holiday tomorrow.

Analysts expect only modest increase in earnings this quarter. Earnings of Sensex companies are likely to swell 12 per cent this quarter according to analysts.

The Reliance stock lost 1.78 per cent to end at Rs 894. Reliance's third quarter numbers were expected to be weak due to lower refining margins and a prolonged refinery shutdown in the last quarter, but the actual numbers, which came after market hours, were below analysts' expectation.

Analysts were predicting a fall of around 8 per cent in the bottomline.

Technology bellwether Infosys Technologies, which will declare its quarterly results tomorrow, is expected to keep up its earnings momentum.

The Dalal Street is expecting a 30 per cent growth in earnings. Still, Infy could not survive the storm on Tuesday with its shares ending 1.8 per cent lower at Rs 2,974.

Similarly, HDFC Bank, fell 1.2 per cent despite the bank announcing a 32 per cent rise in quarterly earnings. One stock which bucked the trend was domestic pharmaceutical major Ranbaxy which gained 4 per cent after the company said it had struck a marketing deal with Swiss company Ferring International to sell hormone tablet Desmopressin in India.

The market breadth was overwhelmingly negative with losers outpacing gainers by over 60 per cent. All the sectoral indices ended in the red. For instance, the BSE CD index dropped 1.76 per cent, the BSE Teck index dipped 1.52 per cent, the BSE FMCG index lost 1.50 per cent, the BSE Metal index declined by 1.48 per cent and the BSE IT index was down 1.41 per cent.

Dealers said that stocks would continue to remain volatile.