Andrew L D'Cunha
Mumbai, Sep 30: The markets have slipped deep into the red with the benchmark indices falling close to 1.5 per cent. 29 of the 30 Sensex stocks declined under intense selling pressure following weakness in global markets . The Sensex was down 244 points to 16,454 and the Nifty fell 72 points to 4943. Metal and auto stocks came under severe selling pressure and were down 3-5% per cent.
Shares of metal companies reacted sharply as the cabinet has approved new Mining Bill which calls for miners to share profits or an amount equivalent to royalties. The government has set 26 per cent profit sharing clause in the bill, say reports. Coal India (-5.25%),), Sterlite Ind (-4.76%) , Tata Steel (-4.01%), Jindal Steel (-3.76%) Hero Motor Corp (-3.01%) were the major Sensex losers. Fontliners like ONGC, TCS, ITC, Wipro, SBI, ICICI Bank, NTPC, BHEL and HDFC were down 2-3%. Even Reliance Industries, Infosys and L&T slipped 0.7-1%. Bharti Airtel (0.78%) was the only index gainer.
Shares of Anil Ambani owned companies were beaten down badly after the the Central Bureau of Investigation told the Supreme Court that Anil Ambani continued to be under investigation in the 2G allocation case. Reliance Capital plunged 12.24%, Reliance Infrastructure fell 7.43%, Reliance Communications was down 7.6% and Reliance Power was 3.76% lower.
European markets like France's CAC and Britain's FTSE were down more than 1.5% each. Germany's DAX fell more than 2.5%. The Dow Jones futures shed 80 points. Investors sentiments are hurt on slow response from policy makers to the growing global financial crisis. Worries about rising inflation in the euro zone, weak German retail sales and contracting Chinese manufacturing activity also dampen investors sentiments.
Asian shares mostly held steady on Friday.The Nikkei Stock Average closed flat, off 0.01%, South Korea’s was also little changed, adding 0.02%. The Shanghai Composite index finished down 0.3% However, Hong Kong’s Hang Seng Index fell 2.3% as investors played catch-up with the rest of the region after a typhoon closed markets on Thursday, notably selling property stocks.
Festive sentiments lift Gold price
Festive sentiments lift Gold by Rs 200 to Rs 26,640 per 10 grams after firm trend in the Asian region. Silver also shot up by Rs 800 to Rs 54,300 per kg on increased offtake by industrial units and jewellers for the ongoing festive season. Trading sentiments turned better after gold climbed in Asia, as investors sought to protect their wealth against Europe's sovereign-debt crisis and a potential slowdown in the global economic recovery. Gold in the Asian region rose by 1.6 per cent to USD 1,640.32 an ounce and silver by 2.2 per cent to USD 31.29 an ounce in Singapore.
Andrew L D'Cunha, Managing Director, WinWin Fin Advisory Pvt. Ltd. Mangalore. Email: finadvisoryltd@yahoo.com.