The markets witnessed a bloodbath in the later part of the trading session due to renewed concerns on the geopolitical front and the resultant spike in crude oil prices, besides a jump in inflation, rollover pressures in wake of expiry of the current derivatives series and caution ahead of the railway budget on Friday and the annual budget on Monday. The Sensex comprehensively broke the 18k mark to end at 17,632, weaker by 545 points or 2.8% and the Nifty shut shop at 5262, down 171 points. The midcap index ended at 6367, lower by 190 points and the smallcap index ended at 7815, down 220 points.
Oil hit two-year highs in Asian trade as the Libyan turmoil threatened to deepen further and engulf the entire Middle Eastern region. New York's main contract, light sweet crude for April delivery, rose $1.00 to $99.10 per barrel after surpassing the $100 mark in yesterday's session for the first time since October 2008. Brent North Sea crude for delivery in April was up 85 cents to $112.10.
Meanwhile, the Asian markets ended lower, with the sole exception of Taiwan, as investors continued to grapple with the unrest in Libya and its effects on the oil markets. The Hang Seng, Nikkei, Straits Times and Seoul lost in the region of around a percent each. And European stocks sank for a fifth day, extending the longest losing streak since October, with the FTSE, CAC and the DAX losing upto a percent each.
On the domestic front, food inflation accelerated in mid-February on rising prices of milk and fruits, amid expectations the government may announce fresh measures to rein in inflation. The food index rose 11.49% in the week ended February 12 despite policymakers' often repeated projections in 2010 that prices would ease to single digits. The food price index rose 11.49% in mid February, slightly higher than last week's 11.05%. The fuel price index climbed 12.14% in the year to February 12, higher than 11.92%, government data showed. And wholesale food prices jumped 15.7% in January compared with 13.6% in December.
The rate-sensitive banking, auto and realty sectors received a severe battering in this session. Tata Motors plunged by 7.5% at Rs 1058 to top the losers list on the BSE. Among the other major auto pivotals, M&M skid by 3.7% at Rs 615 and Bajaj Auto slipped bby 2% at Rs 1279. In the banking space, ICICI Bank weakened by 5.4% at Rs 953, HDFC shed 3.7% at Rs 615 and HDFC Bank lost 2.1% at Rs 2068. And the auto space saw the likes of DB Realty plunging by 9% at Rs 105, HDIL shedding 5.7% at Rs 145 and DLF losing 3% at Rs 213. And index heavyweight RIL lost 3% at Rs 965.
The railway stocks had a nervous session ahead of the Railway budget. Texmaco slumped by 3% a Rs 40, Kalindee plunged by 5.7% at Rs 135 and Titagarh Wagons slipped by 8.7% at Rs 381.
Cipla was the only Sensex stock to buck the carnage; the pharma major gained 0.8% at Rs 305.
The market breadth was weak. Out of 2961 stocks traded on the BSE, there were only 62 advancing stocks as against a whopping 2191 declines.
