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Markets trade lower, banking shares weigh

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SI Reporter Mumbai

Markets extend losses on back of losses in realty and banking share. The Sensex is down 181 points, at 19,751 and the Nifty is trading lower by 56 points, at 5943.

----------------------------Updated at 10:00 hrs

Markets have been fluctuating between gains and losses throughout the week and technical analysts are wary if uptrend will continue. Technical Analyst Rishi Nathai said, "this time Nifty has broken all the important supports, charts indicate sell on every rise or current market price." If bulls have to be stronger than bears than index has to close above 6150 levels for at least three trading sessions, he added. Technical analyst, Prakash Gaba also reckoned, "technically the market is still in a sell mode but volatility and short covering is not ruled out, the crucial support on  the downside for the Nifty is 5930-5897 and resistance at 6111."

Wall Street ended higher on hopes that Ireland might enter an agreement with European Union for a possible bail out. However, the Standard & Poor's 500 index was unable to break out of 1,200 resistance level. The Dow Jones industrial average gained 1.6%, to 11,181.23, the Standard & Poor's 500 rose 1.5%, to 1,196.69 and the Nasdaq Composite added 1.6%, to 2,514.40. General Motors made a stellar debut, surged 8% on listing and closed at $34.19, up 3.6%.

Markets in Asia were subdued on account of an expected rate hike in Shanghai to rein in Inflation. Hong Kong's Heng Seng index fell 1% dragged by Chinese banks and local property stocks. China's Shanghai Composite slipped into the red, down 1%. Japan's Nikkei 225 was up 0.5%, South Korea's Seoul composite was up 0.3%, and Taiwan Weighted rose 0.6%. Strait Times was trading in the red, down 0.6%.

In India, stocks involved in 2G (second generation) allocation scandal continued to face woes. Reliance Communication was down 2.5%, Unitech sagged over 3% in the opening trades.

On the other hand, Bharti Airtel, India's largest mobile operator rose over 3% after unvieling a new identity yesterday and crossing the 200 million customers mark.

Investors continued to cash out of banks that were exposed to SKS Microfinance, Axis Bank was off 1.9%, Kotak Bank lost 1.8% and ICICI Bank dipped 1.6% dragging the Bankex index down 1.4%.

Analysts recommend to use this downtrend as an opportunity to accumulate stocks."We have always maintained that any knee-jerk short-term correction in markets as response to global events, should be looked at as an opportunity to accumulate quality stocks," Gaurav Dua, Head-Research, Sharekhan.

Realty stocks were under pressure in the morning session; Indiabulls Real Estate dropped 3.3%, HDIL and DB Realty shed over 1.5% each. Investor community continues to shun realty shares as volumes continue to remain muted. "Real estate prices have spiked up to 2007/08 peak levels. However, the volume off-take has mellowed down and is a key cause for concerns for the real estate stocks," added Dua.

Hindalco, down 2.3%, Jindal Steel, down 2.3% and SAIL, down 1.8% were the prominent losers for the Nifty. On the other hand, Sterlite, up 1.7%, Hero Honda, up 1.3% and Dr Reddy, up 0.8% were some of the top gainers on Nifty.

 

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First Published: Nov 19 2010 | 11:15 AM IST

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