Stock markets continued to show high volatility on Wednesday. After the sharp recovery in the last two days, Dalal Street lost ground on Wednesday as selling emerged ahead of the expiry of January futures contracts. The 30-share BSE Sensex snapped its two-session winning streak and settled 117.01 points, or 1.95%, lower at 5,876.04. The NSE S&P CNX Nifty index also shed 41.60 points, or 2.18%, to end at 1,863.10. With Wednesday’s fall, the Sensex has cut gains for 2004 to 37 points. The Sensex had gained nearly 400 points in the previous two sessions (Friday and Tuesday). Prior to this, Sensex crashed by nearly 470 points last week. “The market is very unpredictable now. The high volatility is keeping away small investors,” said a dealer. The mood of the market appeared cautious amid a slowdown in inflows from foreign funds and the overnight weakness in the US markets. The imminent expiry of January series futures also appeared to be weighing on the sentiment. The Sensex opened higher at 5,981, but slipped into the red soon after. It then recovered from lower levels and touched the day’s high of 6,030.54 during late morning trades. However, fresh selling dragged the Sensex below the 5,900-mark during afternoon trades. Even the mini Exim policy announced by Commerce Minister Arun Jaitley failed to revive the markets. FIIs pumped in a net Rs 61.50 crore on Friday (January 23), compared to the inflow of Rs 48 crore on Thursday. FIIs have invested Rs 2,592.30 crore so far this month (till January 23, 2004). The inflows seem sloppy, when one considers that FIIs had invested Rs 6,161 crore in December 2003. While fresh export sops announced in the mini Exim Policy may help the services sector, players said foreign fund inflows would continue on the back of strong corporate and economic fundamentals. Corporate results announced so far have been encouraging. Hindalco came off from a high of Rs 1,335 to Rs 1,229.70 before settling at Rs 1,248.90, down 5.53% from its previous close. Bharti Tele-Ventures (down 5.18% to Rs 140) ended lower on selling. Tech pivotals Wipro (down 4.44% to Rs 1,656.70), Infosys Tech (down 2.74% to Rs 5,438.35) and Satyam Computer (down 2.06% to Rs 335.50) lost ground on selling following the overnight fall in the US markets. Hindustan Lever (down 4.41% to Rs 193.10), ITC (down 3.11% to Rs 1,018.45) and State Bank of India (down 2.44% to Rs 633.25) also contributed significantly to the fall of the Sensex. Reliance Industries (down 0.56% to Rs 578.30) ended with a relatively modest loss on selective buying at lower levels after the company said that it would set up a 3,500-MW gas-based power plant in UP.
