Post Market Report on 28.08.2008

[B. Karthick]

India Stocks Review: Fall nearly 2% on F&O expiry; inflation eyed
Thursday, Aug 28

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Bombay Stock Exchange : National Stock Exchange
Sensex: 14048.34, dn 248.45 pts (1.7%) : Nifty: 4214.00, dn 78.10 pts
(1.8%)
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Key share indices lost nearly 2% towards close as traders squared
off positions on expiry of the August derivatives contract today and
on caution ahead of inflation data, due later today.
Both Sensex and Nifty came very close to breaking their
psychological support levels of 14000 and 4200, respectively, amid low
rollovers to the September series today.
Nifty rollover stood at 66%, while market-wide rollover was 75%.
There was basically VWAP (volume weighted average price) selling
that came in, where arbitrageurs sell off positions instead of rolling
them over, which caused the fall. Those with long positions also
avoided rollovers due to a lack of confidence in the market.
Sensex ended at 14048.34, down 248.45 points, or 1.7%, from
Wednesday. Intraday, it moved between 14002.43 and 14347.19.
Nifty closed at 4214.00, down 78.10 points, or 1.8%. Intraday, it
moved between 4201.85 and 4304.50.
Turnover on BSE and NSE combined was 510 bln rupees against 124
bln rupees in the previous session.
All BSE sector indices ended in the red, with selling pressure
seen most in frontline shares. Index heavyweight Reliance Industries
lost 4%.
RIL has seen a consistent build-up of short positions in the past
couple of sessions, and the fall we see now is a culmination of that.
Interest rate-sensitive stocks fell amid concerns of a rate or
cash reserve ratio hike by Reserve Bank of India as inflation
continues to remain high.
Housing Development & Infrastructure dropped nearly 6%, while
ICICI Bank fell 3%.
Weak aluminium prices weighed on shares of National Aluminium Co
and Hindalco Industries. NALCO fell over 5%, while Hindalco ended down
over 6% after going ex-rights today.
Hindalco was the worst hit on Nifty.
Global crude oil prices also played spoilsport in today's session
as they inched higher towards the $120-a-barrel mark on New York
Mercantile Exchange.
Oil retailers lost 2-5%, but oil explorer Cairn India ended up 2%
at 250 rupees benefiting from the rise in oil prices. Cairn was the
top Nifty gainer.
Other rare gainers included Akruti City, which bucked the weak
trend in the real estate sector to rise over 9% on fund buying and
short covering.
Apollo Sindhoori Capital Investment surged 9.5% on news Aditya
Birla Nuvo will buy 56% stake in the company for 1.99 bln rupees.
Suzlon Energy and Hero Honda Motors, up over 1% each, were other
gainers on Nifty.

KEY MARKET MOVES
* In the Nifty, 7 rose and 43 fell.
* In the Sensex, 5 rose and 25 fell.
* On BSE, there were 898 advances and 1,721 declines.
* BSE Oil & Gas: Down 2.6%; BSE Realty: Down 1.8%; CNX Bank Nifty:
Down 1.8%
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Bombay Stock Exchange : National Stock Exchange
Sensex: 14048.34, dn 248.45 pts (1.7%) : Nifty: 4214.00, dn 78.10 pts
(1.8%)
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B.Karthick
Research Analyst.