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A nervous step into a new system

Reshma Krishnan

THE end of the badla regime took its toll on the market on Monday and caused quite a bit of confusion all around.

The Sensex closed down 30.75 points to end the day at 3426.03 points from the previous close of 3456.78 points. The Sensex traded within a range of 68.72 points to trade between an intra-day high of 3487 points and an intra-day low of 3418.289 points.

This also brought to an end a week of consolidation. The day also witnessed the start of options trading in 31 leading shares.

The broad market trend was strong and hence not in tune with the Sensex; perhaps, a sign that all is not lost. The advance-decline ratio was positive with 645 issues increasing in value while only 280 scrips declined. This could have been due to speculat ive buying in second-rung shares.

Volumes on the BSE, however, were not that strong as a result of the termination of the carry-forward system. The volumes almost halved to 44 million shares, down from 80 millions on Friday.

The Business Line 250 composite index tracked Sensex's movement and closed down 9.5 points or 0.9 per cent to end Monday at 994.9 points from the previous close of 1004.4 points.

The consumer index, the index that reflects the sentiment of consumers and their outlook of the economy, was the major loser among the sectoral indices. It fell 2.3 per cent to end the day at 1067.5 from Friday's close of 1092.1.

The two industry indices that took a big hit were the sugar industry and the computer hardware industry indices. The sugar industry index fell 4.6 per cent to end the day at 587.1 points from the previous day's close of 615.5 points. The computer hardwar e and office equipment index was also down 4.6 per cent to end the day at 3464.9 from the previous close of 3631.5.

Cement shares closed higher on Monday. This can be viewed in the light of a report in a financial daily that the industry plans to cut output to stem a fall in prices.

Industry leader Larsen & Toubro gained 1.68 per cent to end the day at Rs 223.45 from the previous close of Rs 219.75. Trading volumes also increased to 2.10 lakh from 1.07 lakhs on Friday.

ACC, the country's second largest cement producer followed suit. It rose 3.52 per cent, to end the day at Rs 141.20, up Rs 4.80, from Friday's close of Rs 136.40.

Trading volumes saw a massive jump to 22 lakhs from the previous day's volumes of 8.27 lakhs. There were also reports that one million ACC shares were sold at the BSE for just one rupee per share against the prevailing market price of Rs 145. This shows the confusion that prevailed in the market in its changeover to a new regime. The Grasim Industries scrip also rose 2.31 per cent.

Bajaj Auto - one of the country's leading two-wheeler makers, saw itself out of investor favour on Monday. The share dropped 3.7 per cent to end the day's trading at Rs 249.90 from the previous day's close of Rs 259.60. Trading volumes fell to 15,408 sha res from 55,582 on weak sales data for June. Sales dropped almost six per cent year-on-year.

The broader 50-share National Stock Exchange index closed down 0.84 per cent at 1,098.60 points.