Stock markets lose steam; select scrips shine

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By S Jha

New Delhi, October 6: The Dow Jones-led global rally on Thursday showed signs of fatigue, as the Indian equity markets gave most of the gains after opening following the Dussehra holiday.

Sensex gave away over 300 points from day’s high, while Nifty too shed over 100 points, as the bears came in strength in the second half of the trading session.

Metals shone brightly, gaining strongly after having been smashed in the previous month, with JSW Steel and Hindalco leading the rally on the bourses with handsome gains of over four per cent. Coal India, which is trending up for a long time amid worsening energy crisis globally, was also up by over four per cent, with technical chartists claiming that the scrip still has a lot of strength.

Zee Entertainment following the approval of the merger with Sony was trending high on the bourses in the early part of the trading session, but gave up much of the gains to close with a gain of over four per cent.

The ICICI Bank, which has emerged as the star performer from the banking space, led the Nifty Bank strongly to close with a gain of over two per cent. The ICICI bank and the Axis Bank have emerged as the flag bearer of the banking space in the Indian bourses.

After a couple of days of strong rally, the US markets are also showing signs of fatigue, as the World Bank and the International Monetary Fund have scaled down the growth projections for the global economy, while they have also not sounded optimistic about the inflation coming under control anytime soon.

Additionally, the foreign institutional investors had another day of a net buy of Rs 279 crores, while the domestic institutional investors net sold equities worth Rs 44 crores, suggesting caution ahead from the institutional approach to the market. Also, the FIIs in the FnO are heavily on the short side.

However, the select stocks in the midcaps and smallcaps space have been trending. The broader IT space was on the positive side, while Persistent Systems gained over seven per cent. The Pune-based IT smallcap company has been badly smashed in the past few months, as it had slumped from the high of almost Rs 5000 a share. In five trading sessions, it has gained over 11 per cent.

Data Patterns, Tejas Networks, Venus Pipes, Kitex were among the smallcaps who strongly gained on the bourses.