Reuters: Market slip to negative trading on Wednesday afternoon, as investors are taking calculated steps to book further positions.
After a weak opening, the Bombay Stock Exchange benchmark Sensex made a turn around on expectations of economic reforms from the new UPA government in the first 100 days after coming to power.
But gains could not sustain for long and indices tumbled as volatility grip the market. Huge selling is seen among the banking and oil & gas stocks. However, some buying is continued among the metal, auto, pharma and capital goods stocks.
The 30-share BSE Sensex is now trading below the 14,100 mark and the NSE Nifty below the 4,300 mark. At 2.31pm, Sensex was at 14,069.75 down by 232.28 points and the 50-share NSE Nifty was at 4,271.20 down by 47.25 points.
On Tuesday, the benchmark had risen 0.1% to its highest close since last 11 September, after bouncing around in choppy trade following a 17.3% surge in the previous session.
The index has recouped more than three-quarters of its value since hitting a 2009 low in early March, as foreign funds pumped about $4 billion into the market. This has pushed the market up by almost half this year, after falling 52% in 2008.
Some analysts believe the market is overbought, and is due for a correction before more clarity emerges on the new government’s proposed plans for economic reform.
Even though the market undercurrent is positive, moves such as privatisation and increased infrastructure spending will take time, analysts said.
Prime Minister-elect Manmohan Singh vowed on Tuesday to revive growth and spread the benefits of economic expansion that swept his coalition back to power with a decisive mandate.