Weak Asian peers, lack of positive cues drag Sensex by over 100 points Analysis for Dec 28, 2011

Dismal performance across the board, poor policy reforms and weak market sentiment extended the loss of the Indian benchmark indices after a weak start. Today, in the first half of trading session, the 30-share barometer index of Bombay Stock Exchange (BSE), Sensex struggled to make a positive beginning due to weak performance of the major Asian and global market. Profit booking ahead of the expiry of derivative contracts for December due on Thursday, weighed heavily on markets. Also holiday mood all over the globe ahead of new year, kept the traders away from their desks, with nothing certain as of yet. However, some buying in the Capital goods, and fast moving consumer goods (FMCG) gave some support to the Sensex.

At 12:23 Hours, BSE SENSEX was at 15,748.06, down by 125.89 points or by 0.79 per cent, while the National Stock Exchange"s wide-based Nifty was trading 42.45 points or by 0.89 per cent lower at 4,708.05.

Meanwhile, the BSE MIDCAP slipped by 50.43 points or by 0.97 per cent to 5,141.93, while the BSE SMLCAP was at 5,609.83, down by 40.19 points or by 0.71 per cent.

The domestic economy looked bleak and will take time to rebound as FII flows remained muted in absence of any major development on the policy front. The impact was visible on the overall market and among the thirteen sectoral indices, all were trading in red led by Realty, Metal, and Banking, except Consumer Durable (CD).

Making it historical, the lower house of the Indian parliament passed the anti-corruption Lokpal Bill yesterday, but the UPA government would face a major disappointment as it might not be able to muster the numbers for the Constitutional Amendment Bill, an idea of Congress general secretary Rahul Gandhi to give Constitutional status to Lokpal and Lokayukta. This is to also affecting the markets today.

The Market breadth, indicating the overall strength of the market, was weak. On BSE out of total 2,490 shares, 844 were advancing, while 1,521 shares declined and 125 remained unchanged.

Top losers of the BSE Sensex pack were Jindal Steel & Power Ltd. (Rs. 467.10, 4.59%), ICICI Bank Ltd. (Rs. 704.50, 2.87%), Jaiprakash Associates Ltd. (Rs. 52.60, 2.59%), Hindalco Industries Ltd. (Rs. 116.95, 2.22%), Sterlite Industries (India) Ltd. (Rs. 89.65, 1.97%), among others.

Among the sectoral indices in BSE, Bankex index was at 9,311.64 down by 180.56 points or by 1.9 per cent. Federal Bank Ltd. (Rs. 322.75, 3.96%), Punjab National Bank (Rs. 782.10, 3.31%), ICICI Bank Ltd. (Rs. 704.50, 2.87%), YES Bank Ltd. (Rs. 244.25, 2.69%), Bank of India (Rs. 281.35, 2.28%).

Following the Bankex, BSE Metal index was at 9,360.82 down by 169.53 points or by 1.78 per cent. Jindal Steel & Power Ltd. (Rs. 465.70, 4.87%), National Aluminium Company Ltd. (Rs. 48.40, 2.52%), Hindalco Industries Ltd. (Rs. 116.95, 2.22%), Sterlite Industries (India) Ltd. (Rs. 89.65, 1.97%), JSW Steel Ltd. (Rs. 497.85, 1.85%).

In the meantime, the other Asian peers opened in red on lack of positive cues from the European and US markets. Japan"s Nikkei 225 was down 16.94 points and was at 8,423.62. Hong Kong"s Hang Seng was down 149.37 points and was at 18,479.80, while Taiwan weighted was down 28.36 points and was at 7056.67. The Shanghai composite was down 20.40 points and was at 2145.81.

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