MUMBAI: Equities witnessed a volatile session Tuesday. After wallowing in the red for major part of the session, the indices pulled back sharply to end off lows. Short covering in realty, power and banking led to the recovery while fall in index-heavy weight Reliance Industries capped the rise.

Market opened with a gap-down tracking other Asian peers after the US economy was officially said to be in recession. The worst hit were the interest rate-sensitive sectors, as traders eyed some financial stimulus from the government like easing in ECB norms and lowering of interest rates.

Automobile stocks were down as economic slowdown hit sales badly while shares of oil exploration companies fell as crude oil price eased to $47.85 per barrel, the lowest since May 2005 and almost $100 off the record peak of $147.27 reached in July.

“Volatility has been such that it took just two trading sessions to test resistance and support levels. We expect the market to remain sideways in the near-term. The trend will only turn bullish once Nifty decisively crosses 2900-3000. Until then, investors should avoid taking positions. On the downside, Nifty faces support at 2600 and then at 2500. If these levels are breached, it will be a cause for concern,” said Neera Jain, chief technical analyst at CRNIndia.com

Bombay Stock Exchange’s Sensex ended at 8,739.24, down 81.98 points or 0.93 per cent from Monday’s close. The index touched an intra-day high of 8785.43 after it hit a low of 8467.43 earlier in the day.

National Stock Exchange’s Nifty closed at 2657.80, down 0.94 per cent or 25.10 points. The 50-share index hit an intra-day high of 2672.90 and low of 2570.70.

BSE Midcap Index declined 1.41 per cent and BSE Smallcap Index fell 1.25 per cent.

Amongst the sectoral indices, BSE Realty Index was up 2.69 per cent, BSE FMCG Index closed 1.14 per cent and BSE Power Index ended 0.50 per cent up.

Among the worst hit sectors were BSE Auto Index down 3.44 per cent, BSE Consumer Durables Index falling 2.59 per cent and BSE Oil&gas Index shedding 2.24 per cent.

Gains in Reliance Infrastructure (5.37%), Bharti Airtel (3.05%), Jaiprakash Associates (2.76%), NTPC (2.46%), ITC (2.45%) and DLF (1.96%) helped indices close off lows.

Mahindra & Mahindra (-8.21%), Maruti Suzuki (-5.24%), Tata Consultancy Services (-5.21%), Larsen & Toubro (-3.46%), Sterlite Industries (-3.29%) and Reliance Industries (-3.10%) ended with significant losses.

Market breadth on BSE remained weak with 1,297 declines outnumbering 801 advances.

European markets were in the green after a poor start and US stock futures pointed towards a positive opening after a sharp fall. Dow Jones stocks futures were up 2.05 per cent, S&P 500 futures moved 2.18 per cent higher and Nasdaq futures climbed 2.33 per cent up.

source: Economictimes

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