Transaction tax worries hurt

STOCKS REPORT

The market mood was circumspect ahead of the government clarification on transaction tax. Despite a run of healthy quarterly earnings reports by companies, investors preferred to remain on the sidelines.

The benchmark Sensex closed lower after three straight sessions of gains. The Bombay Stock Exchange's (BSE) 30-share index touched an intraday high of 4,982.04 and a low of 4,936.60 before eventually closing at 4,957.88, down 0.35 per cent (17.52 points).

Blue chips gave ground with 19 out of the 30 scrips in the Sensex basket closing lower. The BSE IT index was the biggest loser, down 1.40 per cent, in sectoral indices. Market breadth was negative, with declines outnumbering advances by 1,060-to-690 on the BSE.

Auto and technology stocks, too, lost. Shares in Hero Honda Motors fell 3.49 per cent to Rs 436, followed by the Bajaj Auto scrip, down 2.52 per cent to Rs 832.10 and the Tata Motors fell 1.51 per cent to Rs 401.50.

Tech bellwether Infosys Technologies fell 2.12 per cent to Rs 1447.65, Wipro was down 1.71 per cent to Rs 519.65 and Satyam Computers fell 1.41 per cent to Rs 326.20. Profit taking was seen in these counters after recent gains after Infosys reported good earnings this quarter.

The market is also buzzing with talks that big players will sell in other heavyweight technology scrips to make place for the TCS scrip in their portfolios.

Brokers are shying away from taking big positions till clarity on the final shape of the proposed transactions tax is clear. Uncertainty over the progress of monsoons is also playing a dampener on sentiment.

Heavyweights ITC was down 2 per cent to Rs 994.95, the State Bank of India scrip fell 1.42 per cent to Rs 433.45, HLL was down 0.61 per cent to Rs 121.75 while Reliance Industries gained 1.15 per cent to Rs 428.35.

ICICI Bank was the biggest gainer in the Sensex basket, up 3.44 per cent to Rs 261.85, followed by Bharti Tele-Ventures was up 2.58 per cent to Rs 155.30 and HDFC Bank was up 1.23 percent to Rs 370.40.

Volumes were on the decline once again, cash segment turnover of Rs 1569.41 crore was reported on the BSE and Rs 3944.34 crore on the National Stock Exchange (NSE).

Foreign institutional investors were net buyers of Indian shares worth Rs 99.60 crore on Monday while domestic mutual funds were net sellers to the tune of Rs 17.60 crore.