Volatile trade sees Sensex recover

The portfolio tug-of-war at the Centre, the impending expiry of May futures contracts and profit-booking at higher levels together combined to make yesterday's trading a volatile affair on the bourses.

The BSE Sensex ended the day in the negative, down 21 points at 5,102.22, but not before doing a deep dive in the morning and a pole-vault in mid-afternoon.

The morning session saw the Sensex falling 147.22 points in intra-day trades to the day's low of 4,976.01. However, by afternoon, the index had recovered to hit a high of 5,143.93, up 21 points over yesterday's close, before sliding back into the negative.

The National Stock Exchange (NSE) Nifty fell 2.15 points to close at 1,606.70. Brokers also attributed yesterday's fall to weakening Asian markets, as high oil prices raised fears of adverse effects on the global economy.

The mid-afternoon recovery was ascribed to signs of an easing of portfolio squabbles at the Centre.

The Sensex saw 19 scrips closing lower. The broader market was also subdued, with 712 gainers versus 924 losers on the BSE.

The BSE FMCG index was up 1.15 per cent and the PSU index gained 0.66 per cent, bucking the overall negative trend. The BSE Bankex was the biggest loser, down 1.29 per cent, followed by the consumer durables index, down 1.18 per cent.

ONGC was the biggest gainer in the Sensex basket, up 3.25 per cent to Rs 731.60, followed by Hindustan Lever, up 2.46 per cent to Rs 141.65, and Gujarat Ambuja Cements, up 1.44 per cent to Rs 310.10.

Reliance Energy was the biggest loser in the Sensex basket, falling 4.71 per cent to Rs 552.90, followed by HPCL, down 4.10 per cent to Rs 320.45. Maruti Udyog fell 4.04 per cent to Rs 454.95.

Heavyweight ITC gained 0.64 per cent to Rs 924.35, Reliance Industries was up 0.50 per cent to Rs 455.85 and the State Bank of India scrip was marginally down 0.19 per cent to Rs 539.

Tech bellwether Infosys Technologies was up 0.75 per cent to Rs 5,359.05 and Wipro was up 0.68 per cent to Rs 1,620.35.

Tata Motors was down 3.50 per cent to Rs 428.95 while Hero Honda Motor was up 1.37 per cent to Rs 481 and Bajaj Auto 0.50 per cent to Rs 879.70.

Volumes in the market were higher than yesterday's, with turnover of Rs 1,948.92 crore on the BSE and Rs 4,479.19 crore on the NSE in the cash segment. Total volumes in the derivatives segment were of the order of Rs 10,720.93 crore. The spread between Nifty May and June futures has increased.

Nifty June futures were trading at a discount of 35 to 40 points to the spot Nifty in intra-day trades, partly because some of the stocks are ex-dividend. Around 65 per cent of the May series has been rolled over to the next month.

Market participants are now priming themselves up for Thursday, when the futures contracts are due to expire.

The new government is also slated to come out with its common minimum programme the same day. Marketmen add that fears of higher oil prices are also affecting sentiment.