Nifty closes below 5000; realty, oil & gas, banks, FMCG slip

The Nifty closed below the psychological 5,000 mark for the first time in the last 15 sessions. The sell-off was seen across all the sectors barring pharma and auto. Realty, oil & gas, banking and FMCG were the major losers. However, Tata Motors, TCS, HCL Tech, Wipro, Sun Pharma, Ranbaxy, Hero Honda and Cipla were the only gainers. The markets were in a consolidation mode till 2 pm and traded in a tight range of 5,010-5,060.

The markets have faced huge volatility for the last two years, says Shankar Sharma, Vice Chairman and Joint Managing Director, First Global, adding however, the low volatility period will break in two-three months. ''Compared to 2009, 2010 will be tougher for the bulls.'' However, he expects to see 12,000 on the Sensex before 21,000. Inflation, Sharma says, is a bigger concern than high interest rates. ''It could go up to 10% by March.''

Further he says, ''The markets are struggling globally despite positive economic data-the gross domestic product numbers have been good around the world.''

Executive Chairman of Templeton Asset Management, Mark Mobius expects a 20% correction in global markets. ''That's the kind of correction that we would expect in the bullish environment we've had for almost one year now. So, 20% should not be surprising. I was thinking this to be a buy situation resulting in a global 20% correction but it hasn't happened yet. However, I think we may see that. Of course on an individual market level it can happen. China has already corrected by that much."

The 30-share BSE Sensex closed at 16,719.83, down 174.42 points or 1.03% and the 50-share NSE Nifty fell 1.07% or 54.05 points, to settle at 4,987.70. These indices slipped over 2% this week. The BSE Midcap Index was down 0.66% and Smallcap down 0.4%.

The benchmark indices shrugged off positive European cues; FTSE, CAC and DAX were up 1% each and US index futures gained 0.5-0.7%, at the time of closing of Indian equities. However, Asian markets ended lower; Shanghai fell 2% and Hang Seng lost 0.8%. Jakarta, Nikkei and Straits Times were down 0.2-0.5%. Kospi and Taiwan Weighted were flat.