The Hindu Business Line : Nasdaq fall, sell-off in futures market drag Sensex down

NEWS about the distinct prospects of a rollback of the harsh tax measures announced in the Union Budget 2002-03 could not stem the slide in the stock markets on Thursday.

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Profit-booking in frontline technology stocks and added selling pressure in stocks that are also present in the futures market, led to an erosion of the indices during the close of the session.

The meltdown in technology stocks on the Indian bourses on Thursday seems to have been driven by the fall in the tech-heavy Nasdaq market in the US.

The Nasdaq composite index has been falling consistently for the past six trading sessions.

The dull sentiment seems to have rubbed off on Indian tech stocks.

Market watchers also feel that with results coming in, the overall sentiment as regards technology stocks is bearish.

Thursday's fall in the indices was also triggered in part by the expiry and rounding off of stock futures contracts, which in turn led to a sell-off in almost all the 30 stocks that are currently allowed for futures trading.

The BSE sensitive index (Sensex) lost by 52.28 points to close the day's trade at 3,359.64 points after touching a marginally higher level of 3,421.22 points as compared to the previous day's close of 3,411.92 points. Losers outnumbered gainers - - 717 scrips to 545 scrips.

However, the volume of shares that were traded stood at 88.5 million shares, slightly higher than the 83.5 million shares traded during the previous session. Indicating the slide in technology stocks, the BSE Tech Index fell by 26.01 points or 2.63 per cent.

Amongst the biggest losers in this sector were Geometric Software Solutions down 12 per cent and Pentamedia Graphics down 10.2 per cent, both of which crashed in the markets after they declared their financial results for the year 2001-02.

Second line technology stocks that had witnessed considerable speculative buying and had risen sharply over the past few trading sessions, met with heavy selling pressure to close at lower levels.

Amongst the other big losers in the software segment were KPIT Infosystems down 13.64 per cent, Infosys Technologies down 2.3 per cent, NIIT down 3.3 per cent, Satyam Computer down 2.5 per cent, PSI Data Systems down 5.59 per cent, SSI down 5.32 per cent, CMC Ltd down 2.14 per cent and HCL Technologies down 4.5 per cent. The only gainers from this sector were Polaris Laboratories up 7 per cent, Trigyn Technologies and Soffia Soft.

The lacklustre trading during the day also led to selling pressure mounting on public sector undertaking (PSU) stocks. Almost all the PSU stocks sought lower levels and the BSE PSU Index was also down 26.32 points or 1.70 per cent.

Almost all the cement and auto industry stocks were also seen lower.

Amongst cement stocks Gujarat Ambuja was the biggest loser and was down over 4.5 per cent. Amongst auto stocks, except for TVS Motor and Tata Engg, both of which gained, the rest closed lower than their previous close.

The lack of buying support was also evident on the National Stock Exchange (NSE), with the NSE Nifty Index, falling by 16.30 points, to close the day at 1,094.30 points.

The Nifty had closed the previous session at 1,110.60 points.

Some of the top gainers on both the BSE and NSE were ABB Ltd, TVS Motor, Shanti Gears, Polyplex Corporation, Cosmo Films, LIC Housing Finance, Polaris, Thermax, Siemens, State Bank of India, United Breweries and United Phosphorus.

Some of the top losers were Max India, Hinduja TMT, SSI Ltd, Sterlite Optical, Apollo Hospitals, Gujarat Ambuja Cement and KPIT Infosystems.

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Nasdaq fall, sell-off in futures market drag Sensex down