Market snaps two-day winning streak

The market snapped a two-day winning streak as the benchmark Sensex fell by 111 points on Thursday on weak global trends amid sustained selling by foreign funds despite fall in inflation.

Firm Asian cues helped the market to open in positive terrain but worries over the overnight fall on Wall Street and corporate earnings later weighed on the Asian bourses.

Concerned at the deepening US consumer demand, Wall Street fell on Wednesday, affecting other major markets.

Auto, IT and capital goods counters mainly bore the brunt of heavy selling and led the Sensex fall.

After resuming better, the Bombay Stock Exchange 30-share barometer reacted downwards to settle the day at 9,090.88, a fall of 110.97 points or 1.21 per cent over the previous close.

The broader 50-issue Nifty of the National Stock Exchange also moved down by 23.00 points or 0.82 per cent to 2,780.05 from the last close.

Foreign institutional investors (FIIs), the main market driver, continued to be in the selling mood and as per provisional data they sold shares to the tune of Rs 27.08 crore on February 4.

However, domestic institutional investors (DIIs) bought shares worth Rs 284 crore on the same day, salvaging the situation to some extent.

Traders attributed the initial firmness in the Sensex as well as other Asian indices on hopes of economic recovery in China but the rally could not be sustained after the European bourses displayed weak trends in the morning deals. Besides Hong Kong, other Asian markets ended in the red.

Meanwhile, inflation fell to 5.07 per cent, after a gap of two weeks, for the week ended January 24 from 5.64 per cent in the previous week, raising hopes of further cuts in policy rates by the Reserve Bank.

Among the Sensex losers, Sterlite Ind dipped by 5.71 per cent, M&M by 5.69 per cent, Maruti Suzuki by 4.07 per cent, HDFC by 3.66 per cent and TCS by 3.27 per cent.

However, Grasim rose by 3.13 per cent, Tata Steel by 1.59 per cent and Ranbaxy by 1.36 per cent.

The market breadth continued to be negative with 1,459 counters ending with losses as against 1,001 with gains on the BSE.

The trading volume dropped further to Rs 2,589.37 crore from Rs 2,947.13 crore on Wednesday. RIL remained the highest traded share with a turnover of Rs 192.87 crore followed by Wire & Wireless (Rs 106.38 crore), REL Infra (Rs 99.35 crore), Satyam Computer (Rs 87.77 crore) and Reliance Capital (Rs 80.38 crore).

The BSE-100 index also dipped by 43.22 points or 0.93 per cent to 4,619.60 from 4,662.82 previously.