Global sell-off pulls down Indian shares

India’s key stock market indices closed below important psychological levels on Monday as investors from Tokyo to London dumped shares after euro zone debt worries resurfaced.

The Bombay Stock Exchange (BSE) benchmark Sensex lost 1.89 per cent, or 346.61 points, to close at 17,979.48, with 29 out of its 30 components declining. This is the first time the index has closed below 18,000 since March 22.

At the National Stock Exchange (NSE), the Nifty declined 1.82 per cent, or 99.80 points, to 5,386.55. The 50-stock index closed below 5,400-mark for the first time since March 21.
 

MOVERS & LOSERS
	May 23, 2011	% chg
TOP 10 SENSEX LOSERS
BHEL	1935.60	-6.69
ICICI Bank	1006.55	-3.61
Reliance Infra	548.15	-3.57
Tata Motors	1129.50	-3.36
Tata Steel	559.25	-3.30
NTPC	168.10	-3.03
Sterlite Ind	163.00	-3.03
SBI	2252.85	-2.98
JP Associates	79.65	-2.69
ONGC	267.50	-2.39
ONLY GAINER
ITC	190.05	2.29
Stock prices in Rs                                                 Source: BSE

“Most of the negative domestic factors are already in the price. Indian market is reacting to the global developments like the euro zone issue and rebound in dollar at present,” said Sandip Sabharwal, chief executive officer – portfolio management services at Prabhudas Lilladher. “The major indices should find a base around February lows unless there is a severe correction in the global markets,” he added. The Nifty had fallen to 5,177 level on February 11.

Fitch ratings cut Greece’s debt rating by three notches on Friday and Standard & Poor lowered its outlook for Italy to ‘negative’ from ‘stable’ on Saturday, highlighting the fragile nature of Europe’s debt situation. Among the major losers in the Sensex, BHEL fell 6.69 per cent to Rs 1,935.60 after its board recommended sale of 5 per cent stake out of the government’s holding and approved a stock split. Market participants expect the power equipment maker’s follow-on public offering (FPO) to come at a discount from the current stock price. ICICI Bank declined 3.61 per cent to Rs 1,006.55, while Reliance Infrastructure fell 3.57 per cent to Rs 548.15.

“There is no need to get panicked unless the Nifty falls below the February lows,” said Deepak Mohoni, founder of Trendwatch (India). “Locally, the situation is not bad. However, global markets are hitting multi-month lows which is a concern,” he added.

Capital goods, power, banking, realty and metal indices lost over 2 per cent on the BSE. Market breath was negative with 1,973 stock declining on BSE compared with 801 stocks that advanced. Earlier, major Asian markets ended in red. Japan’s Nikkei 225 declined 1.52 per cent, Hong Kong’s Hang Seng lost 2.11 per cent, China’s Shanghai Composite Index tumbled 2.93 per cent and South Korea’s Kospi fell 2.64 per cent. Major European market in UK, Germany and France were trading 1.5-2 per cent lower.