Pain aggravates...Sensex down around 200 pts

The markets have extended their losses in the past one hour. With the Asian markets still reeling under the fears of a Greek contagion, our markets don't seem to have the nerve to hold out. If anything, the cut has only got deeper. Having dragged well below the psychological 17k mark, the BSE Sensex is now quoting at 16920, lower by 167 points, and the Nifty is at 5070, down 54 points. Metal and auto majors are facing the brunt of selling pressure.

The major losers on the Sensex are Tata Motors (weakened by 2.6% at Rs 813), HDFC (lost 1.9% at Rs 2749) and Sterlite (shed 1.7% at Rs 736). The other significant losers are Hindalco, Bharti Airtel and L&T. And index heavyweight RIL has inched marginally lower at Rs 1016.

Among the leading Sensex gainers, Cipla has strengthened by 2.2% at Rs 344, Hindustan Unilever has added 1.8% at Rs 233 and Grasim is up 0.6% at Rs 2603.

There is a lot of activity in the broader space though. The public sector undertaking (PSU) disinvestment candidates such as Engineers India, STC India, Hindustan Copper and Dredging Corporation have spurted after SJVNL received a good response from the investors. The government is aiming to raise Rs 40,000 crore this fiscal through stake sale in public sector entities.

Engineers India, likely to be disinvested in June, has soared by 15% at Rs 442 on the BSE. STC India, the second largest gainer among the PSU pack, has spurted by 7% at Rs 440, followed by Hindustan Copper (up 6%), Dredging Corporation (up 4%). HMT, MMTC, RCF and National Fertilizers are up 2-3% each.

And the public sector oil marketing companies (OMC), including Indian Oil (IOC) and Bharat Petroleum (BPCL) have moved higher on reports that the Union finance ministry will compensate them with an additional Rs 14,000 crore of the Rs 19,620 crore of still-uncovered revenue losses incurred in 2009-10. IOC has gained 2% to Rs 305 and BPCL has added 1.1% at Rs 532. HPCL is however trading marginally lower.

The market breadth has turned neutral. Out of 2703 stocks traded on the BSE, there are 1383 advancing stocks as against 1211 declines.