New circuit limits play havoc

1,326 scrips went into a tailspin on Wednesday

One in every two traded stocks hit the lower limit of circuit filters pushing down the BSE mid-cap index by 434 points in morning trades.

Of the 2,656 stocks traded today, as many as 1,326 scrips today hit the lower circuit filter. However, at the close of the day, 677 stocks or 25 per cent actively traded shares closed at the lower end of circuit filters.

Overall, 558 stocks in T, TS and Z group ended the day at the lower limit of circuit filters against their pervious day's close. Of these, 378 stocks are from the T group, 100 from Z group and 80 are from the TS group.

All these three categories of stocks are under the trade-to-trade group. This essentially means transactions in these stocks are all delivery based. T, TS and Z group stocks, which have been under scanner of market regulator, were worst hit.

Almost 90 per cent stocks in these groups were declined to lower end of circuit filters in the morning. These stocks were put on surveillance by exchanges and their circuit filter limits reduced to 5 per cent.

The panic selling saw total 560 stocks traded under T group hitting the lower circuit intra-day. Overall, 286 stocks from B group, 138 from S group, 133 from TS group, 132 from Z group and 77 from B1 group declined to the lower end of circuit filters during intra-day trading.
 

Bearish Tales
Groups	No of traded  stocks	Stocks in  lower circuit	%
TS	150	133	88.7
T	664	560	84.3
Z	201	132	65.7
B	532	286	53.8
S	361	138	38.2
B1	523	77	14.7
All traded	2,431	1,326	54.5

Thirteen stocks lost more than 10 per cent in their market values; 102 stocks were losers in the range of 8-10 per cent; 276 stocks lost market values between 5-8 per cent and 638 stocks' market value depreciated by 4-5 per cent.

National Peroxide was the largest loser in value terms. It lost Rs 714.80 (9.40 per cent) to Rs 6,890.15 against previous day's close of Rs 7,604.95 on BSE.

Ravalgaon Sugars lost Rs 377.35 (5 per cent) to Rs 7,170.45 (Rs 7,547.80); Victoria Mills Rs 210.03 (5 per cent) to Rs 3,995.75 (Rs 4,206.05); Zandu Pharma Rs 162.40 to Rs 3,254.65 (Rs 3,417.05),;State Bank of Bikaner and Jaipur Rs 143 to Rs 3,078.55 (Rs 3,221.55) and Dawn Mills Rs 142 to Rs 4,002.95 (Rs 4145).

Astra Micro, Triton Valve, Financial Technologies, Gujarat Flurochemicals, Gulf Oil Corporation, Simplex Concrete Piles and Shri Dinesh declined by over Rs 50 each.

The 30 stocks for which the buyers have to pay 100 per cent upfront margins from Monday 26 declined sharply during the morning hours. These stocks declined by almost 10 per cent intra-day before recovering to end 5 per cent lower from the closing level of the previous day.

Volumes in these stocks declined by over 40 per cent from an monthly average of 24.9 million shares till yesterday to 14.97 million shares today.

The BSE has 850 scrips in the trade-to-trade segment on account of surveillance action imposed on them.

This is in addition to scrips of the 'Z' group, which are also settled on a trade-to-trade basis.

The exchange trading system also displays a pop-up caution message at the time of order entry in these scrips. These are typically small cap securities (also referred in common parlance as penny stocks).

All scrips under T-to-T segment (including 'Z' group) are attracting 100 per cent margin from August 8. Additionally, all scrips under this segment attract a reduced circuit filter of 5 per cent from today.

BSE has suspended 1,369 scrips (since 2000-01) on account of non-compliance with various clauses of listing agreement.

It has also issued showcause notices to 95 companies for non-compliance with provisions of listing agreement.