Markets drop sharply; metal stocks melt

Commentary

oi-Sunil

By Sunil Fernandes

Updated: Wednesday, August 29, 2012, 15:39 [IST]

Markets ended the day sharply lower today, dropping for the third successive day in a row, as a sharp fall in European markets aggravated selling pressure. The BSE Sensex closed the day lower by 141 points, while the Nifty shed 47 points.

Metal stocks bore the brunt of the selling pressure on growth woes and allocated coal blocks to select companies in the sector adding to the sharp sell off.

Sterlite Industries dropped more than 4.7%, while Sesa Goa was down 5.40% and SAIL shed 6%. Among the other metal stocks that saw hammering were Tata Steel and Hindalco.

Shares of Jaiprakash Industries saw huge selling pressure and dropped more than 9%, following the opening of its foreign currency convertible bond issue (FCCB).

Shares of the HCL Infosystems tanked after the company denied a report of stake sale after the promoters said that they have no intention of selling their stake in the company at any time in the foreseeable future.

Two wheelers stocks too declined sharply in trade, with Bajaj Auto closing lower by 4%, and Hero Motor Corp dropping almost 3.44%. There were hardly any noteworthy gainers in trade today, except for Tata Power and Kotak Mahindra.

Markets are expected to remain volatile on Thursday, ahead of the expiry of the August contract and would look to Friday's GDP data, which is expected at 11.00 am. The consensus estimate for the Q1 2013 GDP is in the range of 5.3%.

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