Consistent downtrend in financial, capital goods and auto was hammering markets since morning and sent the benchmark Nifty below 5,550 level at 12:21 hours. Heavyweight Reliance Industries too dampened the sentiment further with loss of nearly 1.9%.
Dilip Bhat of Prabhudas Lilladher warned, “It is not impossible to imagine that 5,400-5,500 may happen before the budget. Possibly, even after the budget we may still find those levels continuing right up to the end of March or middle of April.”
The markets have been factoring in likely slowdown in growth, which would impact on earnings of companies going forward. Rising inflation due to supply problem and uptrend in commodities prices in international markets was the cause of concern. Foreign investors have been pulling out money from Indian equities; they were net sellers of around Rs 5,000 crore so far in year 2011. While announcing key rates hike on Tuesday, even RBI hinted that if western region shows growth in their economy then FIIs would start pulling out money from India.
According to Bhat, the markets have little downward bias because there are not enough FII supports looking possible as we run into the budget.
The 30-share BSE Sensex was trading at 18,458, with a loss of 226 points and the 50-share NSE Nifty plunged 75 points to 5,528. However, the Nifty February futures were trading at 24 points premium on first day.
Breadth was pathetic; about 11.4 shares were declined as against one share advanced on National Stock Exchange. The broader indices slipped more than the benchmarks - the BSE Midcap and Smallcap indices tanked 2.9% each.
The markets have been factoring in likely slowdown in growth, which would impact on earnings of companies going forward. Rising inflation due to supply problem and uptrend in commodities prices in international markets was the cause of concern. Foreign investors have been pulling out money from Indian equities; they were net sellers of around Rs 5,000 crore so far in year 2011. While announcing key rates hike on Tuesday, even RBI hinted that if western region shows growth in their economy then FIIs would start pulling out money from India.
According to Bhat, the markets have little downward bias because there are not enough FII supports looking possible as we run into the budget.
The 30-share BSE Sensex was trading at 18,458, with a loss of 226 points and the 50-share NSE Nifty plunged 75 points to 5,528. However, the Nifty February futures were trading at 24 points premium on first day.
Breadth was pathetic; about 11.4 shares were declined as against one share advanced on National Stock Exchange. The broader indices slipped more than the benchmarks - the BSE Midcap and Smallcap indices tanked 2.9% each.
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