Reliance triggers fall

STOCKS REPORT

The BSE Sensex fell 63.76 points to close at 5961.71 on selling by funds. The broader Nifty index closed down 19.70 points at 1,872.35. The Sensex opened at 6030.81, hit a high of 6044.55 and a low of 5956.33.

One of the major losers in the index was the Reliance Industries scrip which closed down 3.37 per cent lower at Rs 527.15. At one point in the late afternoon, the share prices were down four per cent.

On Tuesday night Reliance Industries chairman Mukesh Ambani had told a private news channel that there were "ownership issues" which gives credence to months of speculation in the media and markets that differences were cropping up in the family.

Market operators took the opportunity to book profits in other blue-chips counters where the prices have gone up.

However the market is not attaching much importance to the developments at Reliance, since there is no move to actually split the company.

The company is already professionally managed and both the brothers are known to be efficient managers.

Dealers said they had expected the market to consolidate around the 6,000 level, after a gradual climb over the past month, but the Reliance news had given the market an opportunity to release some steam.

Auto, steel, drugs and banks were also weak. Dealers pointed out that if there is no momentum at the current levels then there are likely to be slippages.

The rise in inflation rate to 7.76 per cent for the previous week also dampened sentiment. Analysts said some of the sell-off could be attributed to this.

Other Reliance group stocks which saw losses were Reliance Energy (down 1.23 per cent to Rs 620.70), IPCL (down 2.33 per cent to Rs 184.30) and Reliance Capital (0.86 per cent to Rs 137.70).

Among the index heavyweights State Bank closed down 2.19 per cent at Rs 510.10, ICICI Bank was down 1.39 per cent to Rs 325.70, Hindustan Lever ended down 0.97 per cent to Rs 133.05 while ONGC slipped to Rs 787.10.