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Indo-Pak tensions pull down Sensex
Published on 27 Dec. 2008 12:58 AM IST
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Wary traders, who didn't want to carry positions ahead of a long weekend, turned sellers on Friday sending equities southward for the fourth consecutive day. Tension between India and Pakistan and lower advance tax payments helped bears dominate the ring. The on-going tension between India and Pakistan weighed on market sentiments, as the service chiefs of army, navy and air-force met Prime Minister Manmohan Singh to brief him on latest security situation. There were also reports that Pakistan has increased its troops across the Line of Control. Lower advance tax payment was another worrying factor for the traders, as direct tax payments for the Oct-Dec quarter fell 22% from the year-ago period. Market was also left slightly disappointed on WPI inflation, as it fell to 6.61% for the week to Dec 13 from 6.84% a week earlier while traders saw it at a nine-month low of 6.5%. Marketmen said inflation has become a non-event as they expect it to dip to 2% by Feb-Mar. "There was fear amongst traders due to the war-like situation with Pakistan. FIIs who had stopped selling in equities for the past one month are now booking profits in small pockets. This is putting pressure on the indices. Today was the first day of new F&O series and normally we see build-up of long positions. But gradual fall in the Sensex indicates that some FIIs were lightening their portfolios," said Anita Gandhi, head-institutional business at Arihant Capital. The BSE Sensex ended at 9328.92, down 239.80 points or 2.51 per cent from Wednesday's close. The index touched an intra-day low of 9294.98 and high of 9706.38. NSE's Nifty closed at 2857.25, down 2.04% or 59.60 points. The broader index touched a low of 2844.80 and a high of 2960.95. Market breadth was negative with 1,597 losers against 866 gainers. The BSE Midcap Index ended down 1.24% and BSE Smallcap Index declined 1.43%. Amongst the sectoral indices, BSE IT Index was down 3.92%, BSE Realty Index was 3.82% lower and BSE Bankex fell 2.99%. BSE Healthcare Index, on the other hand, ended up 0.50%. Reliance Infrastructure (-6.10%), DLF (-5.97%), Infosys Technologies (-5.33%), ICICI Bank (-5.17%) and Mahindra & Mahindra (-4.65%) were the major Sensex losers. Maruti Suzuki (1.68%), Tata Power (0.50%), Satyam Computers (0.41%), Ranbaxy Laboratories (0.30%) and Grasim Industries (0.28%) were the Sensex gainers. Market also lacked volumes as most investors were in a holiday mood after the Christmas holiday on Thursday and some traders going on extended leave till New Year. "The good thing is that markets are going down on low volumes and any good newsflow is likely to spike the benchmarks," Arihant Capital's Gandhi said.

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