Market Tumbles

The key benchmark indices slumped to new intraday lows in late trade on global markets, cautious outlook by IT firm Wipro and sustained selling by foreign funds. The BSE Sensex provisionally lost wn 531.28 points or 4.97%. Though in the red, both the both the BSE Mid-Cap and Small-Cap indices outperformed the Sensex. Index heavyweight Reliance Industries fell more than 5%. Tata Steel fell more than 14% after Moody's Investors Service lowered outlook on corporate family rating to negative from stable. Sterlite Industries fell more than 10%. The market breadth was weak. IT stocks fell on Wipro's cautious outlook at the time of announcing Q2 results before trading hours. Metal stocks declined sharply on weak global metal prices. Banking stocks fell in weak market after recent gains triggered by the central bank's repo rate cut. European markets which opened after Indian market, fell on global recession worries. Key benchmark indices in France, Germany and UK fell by between 2.63% to 2.85%. Trading in US index futures suggested the Dow would fall 166 points at the opening bell. Down 6.79%, Japanese stocks led decline in Asian equities as poor US corporate results and falling commodity prices fanned worries of a protracted global economic slowdown. Stocks in Hong, China, Singapore, South Korea and Taiwan were down by bewteen 1.62% to 5.07%. As per the provisional figures, the BSE 30-share Sensex was down 531.28 points or 4.97% to 10,152.11. The Sensex fell 555.17 points at day’s low of 10,128.22 in late trade. The index declined 198.84 points at the day's high of 10,484.85 in early trade. The S&P CNX Nifty was down 178.10 points or 5.51% to 3,056.80 as per the provisional figures.The BSE Mid-Cap index was down 2.93% at 3,481.96 and The BSE Small-Cap index was down 2.02% at 4,111.67. Both the indices outperformed the Sensex. The market breadth was weak. On BSE, 791 shares advanced as compared to 1710 that declined. 86 shares remained unchanged. India’s largest private sector company by market capitalization and oil refiner Reliance Industries (RIL) fell 5.83% to Rs 1,315.55, ahead of Q2 September 2008 result tomorrow, 23 October 2008. The stock came off the day’s low of Rs 1,315.05. The Bombay High Court, on Tuesday, 21 October 2008, allowed the central government to implead itself in the RIL-Reliance Natural Resources (RNRL) case on gas supply after RNRL said it had no problem to the government being a party in the matter. The hearing of the case is now likely to continue after Diwali vacation. Jaiprakash Associates (down 8.39% to Rs 72.10), Mahindra & Mahindra (down 7.59% to Rs 377.50), ACC (down 7.55% to Rs 450) were the major losers from the Sensex pack. India’s largest commercial vehicle maker by sales Tata Motors declined 4.94% on reports of missing its original Nano rollout deadline of October-December 2008.Reliance Infrastructure fell 6.37% despite 15.5% rise in net profit to Rs 288.97 crore on 51.11% rise in total income to Rs 2674.86 crore in Q2 September 2008 over Q2 September 2007.Reliance Power fell 6.24% after company reported a net profit of Rs 47.20 crore on other income of Rs 64.06 crore in Q2 September 2008. Metal stocks declined on slump in metal prices on the London Metal Exchange. The BSE Metal index was down 8.94% and was the major loser from the sectoral indices on BSE. Sterlite Industries, Hindustan Zinc, National Aluminum Company, Steel Authority of India and Tata Steel fell by between 7.13% to 10.04%.India’s largest steel maker by sales Tata Steel fell 14.18% after Moody's Investors Service lowered outlook on corporate family rating to negative from stable. The change in outlook reflects the more challenging operating conditions now facing Tata Steel UK as a result of the likely deterioration in demand in Europe and the UK in the next 18 months, with declining steel prices and reduced production volumes. Tata Steel, will declare Q2 September 2008 results on 24 October 2008.India’s largest aluminum maker by sales Hindalco Industries skidded 5.67% reports it may sell a part of its Rs 2,081.34-crore stake in group companies, including Grasim Industries, Idea Cellular and Aditya Birla Nuvo, to raise funds to repay a part of the $3-billion bridge loan it obtained to buy Novelis. India’s largest cigarette maker by sales ITC rose 3.05% . The company will announce the Q2 September 2008 result on 24 October 2008.Gillette India rose 2.82% despite 27.9% fall in net profit to Rs 20.04 crore on 4.67% rise in total income to Rs 148.69 crore in Q1 September 2008 over Q1 September 2007.Telecom stocks fell on reports telecom firms may have to shell out Rs 6,000 crore for failing to verify their customers. India's largest telecom services provider by market share Bharti Airtel fell more than 7.5%. India's second largest telecom services provider by market capitalisation Reliance Communications fell more than 8.5%. The government on Monday, 20 October 2008, announced that it would impose a fine of Rs 1,000 for every unverified subscriber. Banking majors fell after recent gains on hopes lower rates will boost lending. ICICI Bank, HDFC Bank and State Bank of India fell by between 3.64% to 8.04%. The BSE's banking sector index Bankex declined 5.57%. ICICI Bank, State Bank of India and HDFC Bank have a weightage of 24.21%, 22.44% and 20.55%, respectively, in the Bankex. The Reserve Bank of India cut repo rate by 100 basis points to 8% on 20 October 2008. The repo rate is the rate at which the RBI provides funds to banks against the collateral of government bonds for a day to three days. IT stocks slumped on overnight fall in American depository receipts (ADRs) and on cautious outlook by IT major Wipro. Weak rupee which augurs well for the sector did not stem the slide. The BSE IT index fell 4.37%.India's fourth largest IT exporter by sales Wipro fell 5.79% after it said the outlook is cautious in the near term given the extent of strain on the global economy. Wipro ADR fell 2.87% on Tuesday, 21 October 2008, ahead of the results. Wipro reported 56.13% spurt in net profit to Rs 852.50 crore on a 15.48% increase in total income to Rs 5551.60 crore in Q2 September 2008 over Q1 June 2008. India's third largest IT exporter by sales Satyam Computer Services lost 2.93%. Its ADR skidded 1.63% overnight. The company raised its earnings guidance in rupee terms at the time of announcing Q2 September 2008 results on Friday, 17 October 2008.India's second largest IT exporter by sales Infosys fell 3.56%. Infosys ADR lost 5.21% overnight. India's largest IT services provider by sales Tata Consultancy Services lost 2.63%, ahead of Q2 results today.Infosys, Satyam Computer Services, Tata Consultancy Service and Wipro have a weightage of 55.06%, 16.01%, 10.45% and 7.09%, respectively, in the BSE IT index. The rupee weakened to a record low against the dollar on Wednesday as losses in the stock market fuelled concerns more foreigners would likely pare their risk exposure and repatriate investments. At the Interbank foreign exchange (Forex) market, the rupee, which ended steady at 49.00/49.01 yesterday, fell by 25 paise to 49.25 against the greenback. Piramal Healthcare fell 8.54% as net profit fell 14.2% to Rs 69.44 crore on 19.7% rise in total income to Rs 636.9 crore in Q2 September 2008 over Q2 September 2007