Sensex ends below 16K on rate hike fears

Benchmark share indices ended lower, amid a volatile trading session Wednesday, as higher-than-expected November inflation stoked fears of rate hike by the central bank. Weakness in European shares also hurt sentiment.

The 30-share Sensex provisionally ended below 16,000 at  15,867.02  down 135.49  points or  0.85% and the 50-share Nifty closed below 4,800 at  4,762.05 down 38.55 points or 0.8% 

The WPI inflation for the month of November came in at 9.11 per cent compared to 9.73 per cent in October. The market was looking at an inflation of below 9 per cent for November. Inflation for November 2010 stood at 8.2%.

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(Updated at 14:20 hrs)

Markets maintained volatile movements, with the Sensex and Nifty swinging between negative and positive zone. Markets turned flat after the announcement of November inflation numbers, which came in at 9.11% vs 9.73% (MoM) and 8.2% (YoY).

By 1430 hours, the Sensex was down 30 points at 15,978 and the 50-share Nifty was down 13 points at 4,787.

On the global front, Asian markets are trading marginally lower. European markets have opened dismal after the Federal Reserve did not announce any fresh measures to stimulate growth. The CAC, DAX and the FTSE were all down nearly 1%.

Back home, BSE Consumer Durable index has tumbled by 2%. Bajaj Electricals, Blue Star, Titan Inds, VIP Industries and Whirpool have melted by nearly 2% each.

In the metal segment, Tata Steel has crashed by 3%. Coal India, Hindalco, JSW Steel and Sterlite have fallen between 1-2%. Steel stocks are down because demand steel has fallen below GDP growth for the first time.

Oil marketing companies (OMCs) such as BPCL, Essar Oil, GAIL India, HPCL, IOC and ONGC have submerged between 1-4%. OMCs dropped as crude oil crosses $100 a barrel mark.   

The main gainers on the Sensex are Sun Pharma and ITC, both gaining bey over 2%. Index heavyweight RIL has declined 1%.

Bharti Airtel is 1% down after Bharti Telecom, the largest promoter group of Bharti Airtel, purchased shares of the company worth Rs 20.50 cr through open market transactions.

Meanwhile, BSE Midcap index has slipped by 0.35% whereas BSE Smallcap index is trading marginally lower.

The market breadth in BSE turns unhealthy with 1216 shares advancing and 1334 shares declining.