RTTNews - A lack of buying support amid weak global cues and extensive profit taking dragged the Indian market sharply down on Wednesday. Weakness in the European markets for the fourth straight day significantly dented investor sentiment.

The BSE Sensex opened lower at 14,978 and bounced back into positive territory in mid-session before unabated selling pushed the key benchmarks sharply lower. The Sensex closed near the day's lows at 14,523, down 435 points or 2.91% from its previous close and the S&P CNX Nifty fell 162 points or 3.58% to 4,356.

Second-line stocks underperformed large-caps. On the BSE, the mid-cap and the small-cap indexes fell around 4% each and decliners outnumbered advancers by 1990 to 686. Stocks across the sectors ended in the red. Realty and metal stocks bore the brunt of the selling pressure followed by public sector, oil/gas and capital good stocks. All the 30 Sensex stocks, with the exception of Tata Power, ended in the red. Tata Power closed up a modest 0.03%.

Tata Steel(down 7.52%), Tata Motors(down 7.36%), Jaiprakash Associates(down 6.28%), Reliance Communication(down 5.92%), DLF(down 5.66%), ONGC(down 5.36%), Hindalco(down 5.25%), Sterlite(down 4.89%), NTPC(down 4.68%) and Wipro(down 4.62%) were the major decliners.

IL&FS Investsmart shed its early gains and ended down 1.90% after its promoter HSBC Securities and Capital Markets India proposed to de-list the equity shares of the broking firm from the stock exchanges.

Among hotel stocks, Indian Hotels plunged 9.05% and Hotel Leela Venture tumbled 5.70% amid reports that occupancies in hotels were down by nearly a third in all major cities during April and May.

Max India rose 1.28% on reports that it is in the process of divesting a 23 percent stake to its foreign partner New York Life International for as much as Rs. 300 billion. Rashtriya Chemicals & Fertilizers plummeted 7.63% after the company's net profit fell to Rs 39.37 crore for the fourth quarter ended March from Rs 51.37 crore in the corresponding quarter last year.

Housing Development and Infrastructure slumped 6.65% after its shareholders approved a proposal to raise up to $600 million(Rs 2880 crore) through a qualified institutional share placement. The shareholders also approved another proposal to offer, issue and allot up to 2.60 crore warrants to its executive chairman and promoter of the company on a preferential basis.

Telecom stocks fell sharply, as stalemate on pricing of 3G services continued even after two rounds of talks between communication and information technology minister A Raja and finance minister Pranab Mukherjee in Delhi on Tuesday. RCOM tumbled 5.92%, Idea Cellular slumped 6.77%, Tata Teleservices fell 1.93% and Bharti Airtel ended down 0.69%

Omaxe fell 3.43% even as its subsidiary bagged construction contracts worth Rs 128.34 crore from the UP government. Jagran Prakashan fell 3.18% despite reporting a 41% rise in its March quarter net profit.

Reliance Industries closed in the red for the the third straight day following an unfavorable court ruling in a gas sales dispute with RNRL. The stock closed down.4.24%. Meanwhile, the potential beneficiaries from the three-year legal battle, RNRL and NTPC also ended down over 4% each.

IRB Infrastructure Developers edged down 0.92% despite emerging as the lowest bidder for a national highway project in Karnataka. Syndicate Bank slumped 5.60% after it raised Tier II Capital to the extent of Rs 200 crore through the issue of unsecured non-convertible sub-ordinated debt .

Kanoria Chemicals & Industries fell over 5% even as CRISIL reaffirmed 'its 'CRISIL GVC Level 3' rating on the company's corporate governance and value creation practices for the year 2008-09. Jupiter Bioscience plunged nearly 10% after foreign fund CLSA (Mauritius) offloaded 1.66 lakh shares or a 1.02% stake in the company in a bulk deal on BSE on Tuesday.

Aditya Birla Nuvo fell 5.33% after its shareholders approved the issue of 1.85 crore warrants to its promoters. Kavveri Telecom Products tumbled 5% after the company decided to raise up to Rs.30 crore through a rights issue.

Welspun India rallied 4.53% after it fixed June 26 as the record date for determining the shareholders eligibility for allotment of new shares under a merger proposal. Apollo Hospitals ended down 0.51% on reports that it has dropped plans to buy a basket of hospitals of privately- held Wockhardt Hospitals due to differences in valuation.

Suzlon Energy slumped 6.18% on reports that it expects a flat year ahead and may not witness the 30% growth that it reported last year. Essar Oil fell 4.26% on reports that it has hiked prices of petrol and diesel by Rs.1-2.50 a litre effective from Wednesday.

Stocks of tea manufacturers bucked the declining trend after the Centre for Monitoring Indian Economy(CMIE) forecast a 10% rise in teas prices in 2009 amid low supply and higher global demand. Warren Tea rallied 4.36%, Jayshree Tea rose 4.09%, Goodricke ended up 0.80%, Asian Tea & Exports advanced 2.03%, Mcleod Russel gained 2.73% and Harrisons Malayalam edged up 0.75%.

On the BSE, Reliance topped the traded value chart with a turnover of Rs 362.05 crore followed by Reliance Natural Resources (Rs 321.73 crore), Reliance Infrastructure (Rs 266.23 crore), Unitech (Rs 239.03 crore) and Reliance Capital (Rs 231.32 crore).

Reliance Natural Resources topped the volume chart with trades of around 32 million shares followed by Cals Refineries (29.45 million), Unitech (27 million), Satyam Computers (23.70 million) and IFCI (19.84 million).

Elsewhere, China's Shanghai Composite index and Japan's Nikkei bucked the declining trend and ended with modest gains, European stocks were trading in negative territory in early trading and Wall Street was poised for a lackluster opening Wednesday following two days of losses amid concerns about the pace and magnitude of economic recovery. Crude oil is trading weaker ahead of the weekly inventory report, but staying above the $70 a barrel mark.

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