Buyers sitting tight

STOCKS REPORT

A lack of impetus, imminent expiry of the current month derivatives contracts and the forthcoming Union Budget played on the sentiment today. The benchmark Bombay Stock Exchange (BSE) Sensex closed lower as investors remained sellers in blue chips and midcaps for the fifth straight day.

Selling was seen in consumer durables, FMCG, technology and metal counters, which were among the biggest losers on the day. In the BSE Sensex basket, 24 out of the 30 scrips closed lower. The breadth of the market was negative, with losers outpacing gainers 7:5 on the BSE.

Brokers said selling pressure was seen in blue chips but importantly a lack of buying dragged the market down today. A dealer from IL&FS Investsmart said, "A lack of impetus is leading to the weakness and volatility."

Players said that the expiry of the current month futures contracts this week and the Union Budget on 28 February are causing investors to shift positions in the futures segment, leading to the weakness and volatility.

The BSE Sensex hit a high of 6602.53 and a low of 6521.07 in intra-day trades before closing at 6534.68, down 49.64 points (0.75 per cent) from Friday's close.

Volumes in the cash segment were lower than on Friday; the BSE reported a turnover of Rs 1,698.12 crore and the NSE reported a turnover of Rs 3,561.45 crore.

Cipla was the biggest loser in the Sensex basket, falling 2.35 per cent to close at Rs 265.60, followed by Reliance Energy, down 1.73 per cent to Rs 547.85. Wipro was down 1.69 per cent to Rs 679.25, HLL fell by 1.62 per cent to Rs 142.40 and BHEL was down 1.55 per cent to Rs 839.45.

Hero Honda was the biggest gainer in the Sensex basket, rising 1.18 per cent to close at Rs 542.30, followed by Maruti Udyog, up 0.64 per cent to Rs 465.70. Gujrat Ambuja Cements gained 0.45 per cent to Rs 438.75, ONGC was up 0.41 per cent to Rs 810.25, SBI was up 0.38 per cent to Rs 660.75 and Ranbaxy Labs gained 0.07 per cent to Rs 1025.90.

Strong buying support from foreign funds has helped the market record a big rally, but the undertone of the market is cautious as a lack of active domestic participation has raised concerns, market players said.

Foreign institutional investors were net buyers of Indian shares worth Rs 252 crore on Friday as per data from the Securities and Exchange Board of India website.