Subprime clouds over Sensex

Markets remained volatile on Tuesday as investors stayed away from major commitments ahead of the Independence Day holiday on Wednesday.

Analysts said investors were worried that the US subprime turmoil may throw up more "negative surprises" in the coming days, and hence, the lacklustre trading.

The Bombay Stock Exchange's Sensex fell 16.30 points, or 0.1 per cent, to 15,000.91. It earlier rose as much as 0.4 percent. Sixteen stocks declined, while 14 advanced in the index.

The S&P/CNX Nifty Index on the National Stock Exchange declined 3.45, or 0.1 per cent, to 4370.20.

HDFC fell 2.1 percent to Rs 1,941.3. Bharat Heavy Electricals Ltd slipped 1.4 per cent to Rs 1,687.

"Overall, the traders are hesitating to take any new position. Even the mutual funds are not buying stocks from their recently raised new fund offers, and they are sitting on cash, said Ashutosh Agarwal, head, business development, Sumedha Fiscal Services. However, he maintained that the domestic markets are following the global cues.

Aegis Mortgage Corp, a Houston-based subprime lender, filed for bankruptcy yesterday, saying it owed more than $100 million to creditors, including investment banks that financed loans to subprime borrowers.