Valuation worry hits bourses

STOCK REPORT

Key indices ended 1 per cent down on Thursday as investors booked profits on concerns over valuations of frontliners.

Asian and European indices remained mixed after the US Federal Reserve on Wednesday said its "predominant concerns" were inflation and an economic slowdown. Hong Kong's Hang Seng fell nearly 2 per cent.

Here, oil retailers bucked the weak trend and remained the biggest Nifty gainers on the back of a decline in crude prices and expectations of strong Oct-Dec earnings.

The Bombay Stock Exchange's 30-share Sensex ended at 13871.71, down 143.21 points or 1 per cent. It touched a record high of 14060.35 in early trade.

The National Stock Exchange's 50-share Nifty ended at 3982.90, down 41.15 points or 1 per cent, after touching a low of 3979.80 and a high of 4041.00 intraday.

Combined turnover on both exchanges was Rs 12,600 crore, marginally up from Wednesday. CNX Midcap Index ended up 0.2 per cent on gains in Sesa Goa and Petronet LNG, which ended up over 3-5 per cent. On BSE, 1,539 shares advanced and 1,050 declined.

ITC was the biggest Nifty loser, ending down 3.9 per cent at Rs 168.65, over concerns the fast moving consumer goods company will post lower third quarter earnings.

BSE FMCG Index ended down 2.2 per cent.

However, Networth Broking in its pre-earnings note recommended investors to buy ITC stock with a price target of Rs 213 over the next 12 months.

Metal shares were other big losers. BSE Metal Index ended down 2 per cent.

Sentiment for metal shares dampened due to weak prices on the London Metal Exchange. Copper futures dropped to a six-month low in Shanghai.

HDFC Bank ended down 1.4 per cent, despite the bank hiking its prime lending rate by 50 basis points to 12.75 per cent, as the stock has factored in the hike.

Oil retailers were the biggest gainers as crude oil prices retreated to around $58 a barrel on the New York Mercantile Exchange.

Crude prices dropped the most in over a year on concerns that milder weather in the US may reduce demand for heating fuel.

Sugar shares gained marginally on news the government had issued an official notification for partially lifting ban on sugar exports.

Dhampur Sugar Mills ended up 1 per cent. Sesa Goa gained over 3 per cent on Thursday on reports that Arcelor Mittal has bid for 51 per cent of Japan's Mitsui in the company.