Sensex dips 208 pts on weak SBI results
SBI net profit tumbled to Rs 20.88 crore for the fourth quarter ended March 31, as against Rs 1,866.60 crore in Q4 of last fiscal due to higher provisioning for bad loans and operating expenses. The SBI stock tumbled 7.78 per cent.
ONGC fell 6.71 per cent on reports that the government has increased its contribution to fuel subsidy to 38.5 per cent from 33 per cent for 2010-11.
Although the move is a positive for refiners like IOC, their stocks fell over delays in government move to raise diesel prices. Last week, the government was expected to raise diesel prices by about Rs 4 to partially reduce the subsidy burden on them.
Sensex top heavyweight and refinery major RIL also shed 2.53 per cent, pulling down the market further.
The 30-share Bombay Stock Exchange index, Sensex, initially touched a high of 18,435.80 but fell back to settle the day at about 8-week low of 18,137.35, down 207.68 points or 1.13 per cent.
Yesterday, it fell 186.25 points or 1.01 per cent amid investor concerns of high inflation and further rise in interest rates, triggered by moves to revise upwards the fuel prices in line with international rates.
The NSE 50-issue index, Nifty, dropped 60.05 points or 1.09 per cent to 5,438.95.
Global markets were also weak and failed to bolster investor sentiment.
"Today was a really bad day for the index bellwethers like ONGC, SBI and Reliance. If it wasn`t for strength in ITC, HUL and TCS, the damage could have been much more," said Amar Ambani, Head of Research (India Private Clients) at IIFL.
He said that going ahead, the results of biggies like Bajaj Auto, L&T and ITC will have a bearing on the market sentiment.
However, Ambani added, "But above all, inflation continues to be the biggest impediment for the market and it is not likely to go away in a hurry. So, the market will remain under pressure till there is any material moderation in inflation and FII flows turn positive."
Fall in heavyweights like SBI, RIL, ONGC and ICICI Bank contributed nearly 200 points to the Sensex fall.
Meanwhile, after heavy sell-off worth Rs 4,583 crore on May 12 and 13, foreign funds bought shares worth Rs 47.07 crore yesterday as per provisional data.
From Asia, key indices from Hong Kong, South Korea and Taiwan closed with slight losses, while from China and Japan ended with moderate gains. Singapore market was closed today.
Among European markets, the CAC and the FTSE were trading up, while DAX was down.
In all, 19 out of 30 index-based scrips closed with losses, while others recorded gains.
Among the major losers were Hero Honda (3.39 pc), REL Infra (2.17 pc), Jaipra Asso (2.06 pc), NTPC (1.72 pc), ICICI Bank (1.70 pc), Tata Motors (1.54 pc), Maruti Suzuki (1.23 pc) and L&T (0.82 pc).
However, Jindal Steel rose 1.97 per cent, HUL (1.60 pc), TCS (1.30 pc), ITC (0.83 pc) and DLF (0.64 pc).
Among the sectoral indices, BSE-Oil&Gas dipped 3.23 per cent, Bankex – 2.24 per cent, PSU – 2.24 per cent and Auto by 1.02 per cent.
The total BSE market breadth remained negative as 1,725 counters closed in the red, while 1,063 ended with gains. The total turnover was higher at Rs 2,797.54 crore from Rs 2,112.54 crore on Monday.