Talk of steel regulator hits Sensex

Steel scrips went under the hammer on the bourses on Monday on fears that a government regulator would be set up to control the industry.

The Bombay Stock Exchange (BSE) Sensex fell 107 points to the day's low of 4725.39 before closing at 4746.01, down 1.79 per cent (86.70 points), falling for the third straight day as lack of buying activity hit the market.

The 30-scrip Sensex basket saw 23 scrips closing lower with losers outpacing gainers 3:1 on the BSE.

The National Stock Exchange (NSE) Nifty fell by 27.10 points to close at 1,481.35.

Steel scrips were hammered on Monday on reports that the government is considering a regulatory body to monitor and fix steel prices.

The scrip of Steel Authority of India Ltd (SAIL) fell 8.46 per cent to Rs 26.50, Tata Steel was down 5.88 per cent to Rs 272.90, Jindal Iron and Steel fell 6.68 per cent to Rs 140.30, Essar fell 4.79 per cent and Ispat Industries was down 3.57 per cent.

There were also talks that the steel ministry may consider scrapping the 5 per cent import duty to prevent any sharp rise in steel prices.

Brokers said that steel minister Ram Vilas Paswan's statements over the weekend about his ministry considering a steel regulator to monitor prices and supply sent wrong signals about the government's commitment to market reforms.

Market players indicate that the mood in the market continues to remain subdued amid uncertainty over the government's economic policies.

The budget will give a clearer idea on the government's plans to achieve its growth target while maintaining fiscal balance, said brokers.