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Jaya-Centre face-off savages Sensex by 166 points to 3519.39; infotech, pharma, telecom, FMCG bear the brunt

M P Joshi in Bombay

The Sensex of the Bombay Stock Exchange fell sharply by 167 points today to below 3,600 mark.

The 30-share premier index also touched a half-year low. Share prices tumbled across the board amidst volatile trading.

The drama unfoled as soon as there was talk of political uncertainty at the Centre. This was sparked by the face-off between the All India Anna Dravida Munnetra Kazhagam, one of the partners in India's coalition government, and the Bharatiya Janata Party, the single largest group in the coalition and the Lok Sabha.

The Union Cabinet's decision rejecting all the three demands made by the AIADMK president J Jayalalitha, including shifting Defence Minister George Fernandes to some other ministry, has badly affected the market sentiments. The AIADMK supremo also convened a crucial meeting this evening in Madras to take a decision regarding her party's support to the Centre.

The market witnessed all-round selling pressure from bull operators and foreign institutional investors and domestic institutional investors at the first day of current weekly settlement.

Dealers attributed the heavy selling spree to the unwinding of positions by bull operators. The infotech and pharma were the major losers compared to the losses reported by shares from telecom and fast movable consumers goods sectors, analysts said.

Reflecting the trend, the Sensex opened at the day's high of 3635.21 points, surpassing the psychological barrier of 3600 points and touched the day's low of 3499.83 points, before closing at 3519.39 points, showing a net loss of 166.90 points as against the previous close of 3686.29 points.

According to market sources, this is the first time the Sensex fell by such a large extent after it had recorded a major fall of 224 points on October 5, 1998. The Sensex had reported loss of 224 points at 2878.07 from the previous close of 3102.29 points.

The broad-based BSE-100 index also declined sharply by 74.10 points to 1559.77 poins as against the previous close of 1633.87 points.

Vasudeo Joshi, assistant director at the Jardine Fleming Asset Management Company said that market has suffered a major loss only due to unwinding of positions by operators in fear of political uncertainty. However, the market may not witness any major fall in response to the political happenings.

Even in case the AIADMK withdrew support to the BJP-led coalition government, the loss in the Sensex would not be more than 100 points, he said confidently. Joshi ruled out heavy selling spree by the foreign institutional institutions today.

Several scrips hit the downward filters during the course of trading. Satyam Computers, Pentafour Software, Hero Honda, SBI and Reliance turned out to be big losers.

The losers also included Bajaj Auto who fell by Rs 18 to Rs 612, BHEL Rs 19.10 to Rs 216, Cadbury's Rs 35.25 to Rs 595.20, Castrol Rs 28 to Rs 814, Dabur India Rs 40.75 to Rs 583.25, Dr Reddy's Rs 65 to Rs 785, E Merck Rs 56.25 to Rs 649, Glaxo Rs 52 to Rs 869, Hero Honda Rs 53 to Rs 812, Hindustan Lever Rs 46 to Rs 2174, Hindalco Rs 24.50 to Rs 448, Infosys Technologies Rs 79 to Rs 2,750, ITC Rs 61 to Rs 883, Mahindra and Mahindra Rs 12.90 to Rs 216.90, MTNL Rs 11.30 to Rs 160.70, NIIT Rs 80 to Rs 1,770, Pentafour Software Rs 100 to Rs 1,151, Procter and Gamble Rs 44 to Rs 941, Ranbaxy Rs 17 to Rs 620, Reliance Rs 9.80 to Rs 121.80, SBI Rs 16.40 to Rs 189, Telco Rs 13.30 to Rs 153.30 and Zee Telefilms Rs 71.25 to Rs 977.25.

Total turnover on the BOLT system reported during the day was Rs 15.59 billion, lower than the previous day's turnover of Rs 17.30 billion on April 1.

Satyam Computers topped the list of turnover by registering the highest turnover of Rs 2.45 billion, followed by Pentafour Software Rs 2.19 billion, ITC Rs 1.28 billion, SBI Rs 627.8 million and Reliance Rs 571.8 million.

Other actively traded counters were ACC (Rs 531.2 million), Digital Equipment (Rs 501.3 million), Tata Tea (Rs 460.7 million), L&T (Rs 454.3 million), Zee Telefilms (Rs 322.8 million), Infosys Technologies (Rs 292.6 million), Sterlite (Rs 278.5 million), MTNL (Rs 240.8 million) and BPL Limited (Rs 230.4 million).

UNI

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