The markets seemed ripe for some Diwali fireworks on Wednesday morning, with the US indices having advanced to new 12-month highs on Monday on the back of good quarterly numbers, and the Asian bourses having a nice look about them.
The Dow Jones had added 96 points or 0.96 per cent to end at 10,092. And, the Nasdaq rose 19 points or 0.91 per cent to close at 2,176 on Monday. The Hang Seng opened 162 points up at 22,363, the Nikkei added 111 points to 10,346 and the Shanghai Composite increased 28 points to 3,066.
And so it was, with the Sensex crossing the three-figure mark in gains and the Nifty touching a 17-month high on the opening bell. The Sensex opened at 17,414, far higher than yesterday's close, and touched a high of 17,457, while the Nifty started at 5,145 and reached a high of 5,181.
The metal and realty stocks were the major movers. Moreover, NTPC registered gains following the government's nod to divest five per cent stake in the power major and Reliance put on weight ahead of the gas dispute ruling.
But the momentum did not last beyond the first hour. The market participants opted to take some profits off the table following the pre-Diwali rally. And before one knew it, the markets shed all their early morning gains and drifted below the dotted line, albeit momentarily.
The bulls, to their credit, managed to hold the markets above water, again thanks to the steel stocks. But the bears managed to assert their authority and pulled the markets down around noon.
The markets attempted a pullback thereafter and both the benchmark indices actually catapulted into the green at one point.
But the bears had the last laugh, dragging the Sensex to an intra-day low of 17,185 and the Nifty to a trough of 5,102. The Sensex ended at 17,223, down 103 points, and the Nifty closed at 5,114, lower by 27 points.
The market breadth was fairly negative. Of 2,844 shares traded on BSE, 1,471 declined, and 1,322 rose. The BSE realty and the metal indices were up nearly a per cent each at 4,729 and 15,911, respectively. The oil & gas index, on the other hand, was down over 1.7 per cent at 10,511, respectively.
Mahindra & Mahindra and Reliance Communications tumbled 3 per cent each to Rs 908 and Rs 231, respectively. ONGC and Reliance also slipped around 2 per cent each to Rs 1,208 and Rs 2,184, respectively. Grasim Industries, Hindustan Unilever and ACC were down over 1.5 per cent each.
On the other hand, Hindalco soared 5 per cent to Rs 141. Tata Steel, TCS and Jaiprakash Associates advanced over 2 per cent each to Rs 575, Rs 621 and Rs 265, respectively. Wipro, Maruti, DLF and NTPC were the other marginal gainers, up over 1 per cent each.
Deven Choksey, managing director, KR Choksey, said, "The corporate earnings have been good and the liquidity situation is comfortable. A resolution of the Reliance-RNRL issue now holds the key to future market direction. The markets should trade in a tight range between 5,000 and 5,200 for the next one month."
And upside would depend on the Nifty breaking the 5,250 mark."
