Sensex ends 216 points down; oil & gas, FMCG, banks dip
27 Oct 2010
Equity benchmarks closed sharply lower on huge volumes but managed to settle above their psychologically important levels. The sell-off was seen in power, oil & gas, private financial, FMCG, realty, cement, select auto and technology companies' shares. The Sensex ended just above the 20,000 mark after adjustment of trade and even the Nifty managed to hold the 6000 level.
The market has continued its downtrend for the second consecutive day on the back of profit booking, ahead of F&O expiry for the month of October tomorrow; indices saw huge selling pressure in the second half of trade while first half of trade was mildly negative. Overall it has been in a range of 6000-6150 especially since it had passed 6250 level.
Vibhav Kapoor of IL&FS expects a technical correction towards the 5,700-5,800 mark. However he is quick to say that the markets will move up sharply after correcting to 5,800.
"The markets have had gone up by about 10% in the last expiry, so obviously they were due for a correction and that correction is taking the form of a sideways movement at the moment. I wouldn't be surprised if the markets were to correct a little bit more from hereon maybe a maximum of 5,700-5,800. It could just be a technical correction since the markets have gone up so much while the corporate results are inline with expectations; they are not surprising on the upside either. The market has run ahead in terms of time. We also have QE2 coming up on November 3and the RBI policy on November 2. If the markets take them a little bit negatively for some reason or the other, then you could have this 4-5% correction from here," he explained.
"But after this corrective move is over and I expect that to probably take another couple of weeks at least, the markets will be ready for another sharp upmove which could take the Nifty much higher from here," he said.
The 30-share BSE Sensex closed at 20,005.37, down 216.02 points or 1.07% and the 50-share NSE Nifty fell 69.35 points or 1.14% to 6,012.65. However, the Nifty October futures ended at 18 points premium and November futures at 48 points premium, as per provisional data.
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