Sensex extends losing streak ,ends 0.92% lower amid weak Asian cues Analysis for Dec 28, 2011

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Today, the domestic benchmarks closed on a negative note for the third straight session as weak cues from the Asian markets weighed on sentiment. The Metal and Banking space led the decline.

BSE SENSEX closed at 15727.85 down by 146.1 points or by 0.92 % and then NSE Nifty ended at 4705.8 down by 44.7 points or by 0.94 %.The BSE MIDCAP closed at 5137.18 down by 55.18 points or by 1.06 %, while the BSE SMLCAP ended at 5586.55 down by 63.47 points or by 1.12 %.The BSE Sensex touched intraday high of 15887.8 and intraday low of 15666.46 The NSE Nifty touched intraday high of 4756.2 and intraday low of 4685.65.

The positive closing of the US markets on Tuesday had little impact on domestic sentiment during morning trade. On Tuesday, the Nasdaq closed at 2625.2, gaining 6.56 points over the previous day"s closing and the S&P 500 gained .10 points and closed at 1265.4. The Dow Jones Industrial lost 2.65 points and closed at 12291.05. Soon after witnessing a gap down opening, the domestic benchmarks slipped further amid weak cues from the Asian markets. Most of the Asian markets were trading lower on Wednesday after a report said that industrial production in Japan contracted in November 2011, compared to the previous month as overseas demand weakened, while consumer spending in the country fell for the ninth straight month in November 2011. Moreover, a larger than expected drop in US home prices in October 2011 also weighed on sentiment. US house prices fell by 3.4 per cent in October 2011, year on yea r, a sign that a housing market recovery remains far way. Moreover, investors were also wary of taking fresh positions in stocks with the year soon coming to an end. The benchmarks continued to trade on a subdued note in then negative terrain amid weak global cues. The benchmarks fell to the day"s low in afternoon trade as profit booking ahead of the expiry of derivative contracts for December 2011 due on Thursday weighed heavy. The benchmarks continued to trade lackluster in the final three hours of the trading session. Finally, the domestic benchmarks ended on a bearish note, with the BSE Sensex and the NSE Nifty shedding over 0.90% each. Among the BSE Sectoral indices, BSE Metal and BSE Bankex lost 2.05% and 1.98% respectively.

Among the 30 Sensex stocks, Jindal Steel & Power, ICICI Bank, Hindalco Industries, Mahindra & Mahindra and Wipro closed lower by 7.07%, 3.88%, 2.51%, 2.39% and 2.27% respectively. Among the Sensex stocks, there were 12 advances and 18 declines. On BSE out of total shares traded 2896, shares advanced were 1065 while 1711 shares declined and 120 were unchanged.

On the economic front, the Indian government said on Tuesday that bilateral trade between Japan and India is likely to reach USD 25 billion by 2014, up from USD 15 billion in 2010.

On the global front, industrial production in Japan contracted in November 2011, compared to the previous month as overseas demand weakened amid a stronger yen and the lingering debt crises in Europe, said a report by the Ministry of Economy, Trade and Industry on Wednesday. Japan"s industrial output fell by 2.6 per cent in November 2011, compared to the previous month.

On the Asian front, Shanghai Composite closed up 0.18%, Hang Seng ended down 0.59% and Nikkei 225 closed down 0.20% on Wednesday.

On the European front, CAC40 was up 0.58%, DAX was trading higher by 0.14% and FTSE100 was up 0.66% on Wednesday.

On the Corporate front, Punj Lloyd said on Wednesday that it has bagged a Rs 1,050 crore highway project from GMR Projects Private Limited. The stock of Punj Lloyd closed down 0.97% at Rs 40.90 on the BSE.

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