Nifty ends below 5300, sheds 100 points from day's high
15 Apr 2010
The benchmark Nifty cracked in the last one hour of trade and closed below the psychological 5300 mark, dragged by heavyweights like Reliance Industries, SBI, ICICI Bank, ITC, BHEL, L&T and Bharti Airtel.
It shed 100 points and the Sensex more than 300 points from intraday highs. The indices started the day on a strong note, but sell-off in heavyweights erased those early gains in the afternoon trade.
The markets could have reacted to likely rate hike in Monetary Policy for 2010-11 on April 20 while profit booking was another reason for today's downtrend.
Jahangir Aziz of JPMorgan said, "The RBI is likely to tighten in Tuesday's policy review. Rising non-food inflation and the risk of being forced to tighten too much, too late will be the primary motive. We expect a 50-75 bps hike in the CRR along with a 50 bps increase in the policy rates in this review."
Christian Nolting, Regional Head of Portfolio Management and Lead Strategist, Asia Pacific at Deutsche Bank also saw 100 bps rate hike in next 12-months.
India's food price index rose 17.22% in the 12 months to April 3, while the fuel index was up 12.43%. The rise in the food price index was slightly lower than an annual rise of 17.70% in the previous week. The wholesale price index (WPI), on the other hand rose an annual 9.90% in March, the fastest pace in 17 months, driven by higher food and fuel prices.