Unhappy New Year so far on D-Street, Sensex slips further

Tags: News
It is the eighth day of 2014 and the country’s bellwether stock indices are still waiting for a closing in the positive territory.

On Tuesday, the Sensex closed nearly 100 points down at 20,693.24. All the five sessions so far this year have ended in the negative territory for Sensex, which has lost a cumulative 477.44 points since the start of the year. For NSE’s Nifty index, the loss has been 142 points so far, which left it at 6,162.25 at the end of Tuesday.

The biggest losers in the New Year have been power and oil & gas stocks, with the indices representing them declining 4.84 per cent and 4.09 per cent, respectively, over the past five days. The only gainer in these five days has been the BSE healthcare index, which has risen by a marginal 1.102 per cent. The IT index is down 0.17 per cent so far in the New Year.

Other big losers among the sectoral indices are the capital goods index (3.85 per cent) and bankex (3.02 per cent).

On Tuesday, IT stocks led the fall, with Infosys losing 1.62 per cent or Rs 56.80 apiece to Rs 3,457.40 and Tata Consultancy Services shedding 1.40 per cent, or Rs 31.40 apiece, to end at Rs 2,208.20.

Other big losers on Tuesday included Tata Steel (3.29 per cent to Rs 394.80), Tata Power (2.87 per cent to Rs 79.55) and Sesa-Sterlite (1.86 per cent to Rs 194.85).

“Weakness in global markets and profit booking at higher levels led to selling pressure,” said Rakesh Goyal, senior vice-president at Bonanza Portfolio.

He said in the coming sessions, 6,130 would be crucial deciding level for Nifty, and the index is likely to see further selling pressure below this level.

Nifty made an intraday low of 6,145 from where some recovery was seen and the index pared losses partially. Global cues and third quarter results will dictate further market direction.

Infosys’ third quarter results are scheduled for January 10.

“With no triggers on the domestic or global front for the next two days, our view is that the upside of the market is capped and one can expect lower levels with high volatility,” said Gaurang Shah, assistant vice-president at Geojit BNP Paribas. “Activity is likely to pick by Friday after Infosys declares its quarterly numbers and we will have the IIP numbers as well,” he said.

On Tuesday, 1,289 stocks gained while 1,246 stocks ended in the negative territory. FIIs who were big buyers of stocks in 2013 have pumped in Rs 736 crore ($119.37million) so far this year.

The MSCI Asia Pacific Index lost 0.4 per cent to 138.66 as of 5:14 pm in Tokyo, heading for the lowest close since December 19, Bloomberg reported.

Shrikant Chouhan, head of technical research at Kotak Securities, said the selloff was mainly due to weak global cues and failure of Nifty to perform above 6,300. Towards the end, it recovered partially on the back of a quick surge in private banks and telecom stocks.

“We are of the view that ahead of the quarterly results of index giant Infosys, the market will try to manage and trade above 6,129. On the dismissal of 6,129, bears will take charge of the market and it could fall to 5,900 level, where the market has support from the 200-day simple moving average,” he said.

Other than Infosys results, the US labour department will release the unemployment rate and new hiring figures for last month on January 10.

The federal open market committee (FOMC) said last month it planned to taper monthly bond purchases to $75 billion from $85 billion starting January after labour market conditions shown further improvement. The committee is scheduled to meet on January 28 and 29.

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