Sensex falls; derivatives expiry sparks record volumes

MUMBAI Thu Dec 27, 2012 6:58pm IST

1 of 2. Commuters walk past the Bombay Stock Exchange (BSE) building in Mumbai February 28, 2011.

Credit: Reuters/Danish Siddiqui/Files

Related Topics

Stocks

   

MUMBAI (Reuters) - The BSE Sensex fell as recent gainers such as Reliance Industries were hit by profit-booking, while IT stocks fell due to concerns about their outlooks on a day in which the expiry of derivatives led to record volumes in the futures and options (F&O) segment.

Turnover in F&O on Thursday reached around 4.2 trillion Indian rupees, an all-time high, several traders said, as the number of contracts rolled over from the December contracts to the January series fell.

According to data culled from traders, the more actively traded National Stock Exchange saw around 62 percent of contracts rolled over, marking a decrease from around 72 percent carried over in November.

The reduced rollovers lead to higher volumes as investors settle the contracts. Traders said the higher number of trade settlements was likely intended to book profits in long contracts after strong gains in domestic equities this year.

"There seems to be the lot of unwinding of the long outstanding contract to start with new slate, resulting in the highest turnover on Thursday," said K K Mital, head of portfolio management at Globe Capital.

The BSE Sensex fell 0.48 percent, or 93.66 points, to end at 19,323.80.

The broader Nifty fell 0.6 percent, or 35.50 points, to end at 5,870.10, ending below the psychological level of 5,900 points.

Caution also prevailed with only three trading sessions left in 2012, as the U.S. "fiscal cliff" negotiations continue, while the strong foreign buying that has helped sustain Indian stocks could peter out as investors close their books.

The BSE Sensex has gained around 25 percent this year, backed by about $24 billion in foreign buying across domestic equities.

Although expected interest rate cuts in January could support shares, investors also remain wary about growth, especially after the country's prime minister on Thursday called a five-year plan for average growth of 8 percent "ambitious.

Among decliners on Thursday, Reliance Industries Ltd (RELI.NS) fell 1.3 percent hit by profit-taking after shares gained 4.4 percent so this month as of Wednesday, trumping a 0.2 percent fall in the Nifty.

Other shares that were hit by profit-taking included Mahindra & Mahindra Ltd (MAHM.NS), which fell 1.5 percent, and Hindustan Unilever Ltd (HLL.NS), which ended down 1 percent.

Technology shares extended falls on caution ahead of their earnings next month and uncertainty about their 2013 outlooks.

Infosys Ltd (INFY.NS) shares fell 1.2 percent, while Tata Consultancy Services Ltd (TCS.NS) lost 0.9 percent.

However, among gainers, Tata Motors Ltd (TAMO.NS) shares gained 1 percent as hopes for a better outlook in 2013 for key unit Jaguar Land Rover led investors to roll over their derivatives positions, according to traders.

Clariant Chemicals India Ltd (CLAC.NS) shares gained 1.5 percent after the company said SK capital will buy its textile chemicals and paper specialties unit. Financial details were not provided.

Kalpataru Power Transmission Ltd (KAPT.NS) shares gained 2 percent after the company said in a statement it received orders worth over 9.55 billion rupees.

(Editing by Rafael Nam and Sunil Nair)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

Shares Hit Record

Sensex, Nifty rise to second consecutive record high

Sensex surges 500 points on BOJ easing, L&T gains

The BSE Sensex and Nifty surged to record highs for a second consecutive session on Friday after Bank of Japan's surprise expansion of its massive stimulus programme raised hopes for additional foreign inflows, boosting blue-chips such as Larsen & Toubro.  Full Article 

REUTERS SHOWCASE

Indian Economy

Indian Economy

India's fiscal deficit in H1 almost 83 pct of full-year target.  Full Article 

M&M Earnings

M&M Earnings

M&M Q2 net profit down 4 percent, hit by poor monsoon.  Full Article 

Ban on E-Cigs?

Ban on E-Cigs?

Govt considers ban on e-cigarettes, sale of single smokes.  Full Article 

Commodities

Commodities

Silver futures in India hit four-year low on global cues.  Full Article 

BOJ Policy

BOJ Policy

BOJ shocks markets with surprise easing as inflation slows.  Full Article 

Shadow Banking

Shadow Banking

China's shadow banking sector growing rapidly, third largest in world - FSB.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage