Mumbai, Oct. 24: Fears about a hail of dour quarterly numbers pelted stocks, taking the Bombay Stock Exchange (BSE) to a year’s low amid talk that a tumble below the key psychological threshold of 2,900 is imminent.
The slide in indices was triggered by a selling avalanche in Hindustan Lever (HLL) and Reliance Industries (RIL), two companies that decide how the sensex behaves, and whose fortunes fluctuate more sharply with the economy than others in Corporate India.
At 2908.05, the country’s main barometer of stock vitality sunk to its lowest point since October 10 last year. In the past four days lone, it has given up over 100 points. “There are some big results coming up. The apprehension over their earnings is high. Worse, there are no triggers,” said up a broker who expects bourses to languish in negative territory over the next few days.
Bears mauled Lever, supposed to declare its first-half numbers on Friday, as many took at least a 5 per cent knock to its top-line for granted; others said the drop could be steeper at 10 per cent. However, most agree that profits will increase 10 per cent year on year.
What has fed worries is the impact of poor monsoon on the company’s performance in its third quarter. “The rural market is a key area for HLL. Therefore, the prolonged dry spell will have an adverse impact on its top-line this time,” an analyst said.
The stock closed on Dalal Street at Rs 167.70, a 2.13 per cent loss over its previous finish. It had opened at Rs 172 before being hammered to the day’s low of Rs 166.80.
It was a choppy session for Reliance too, which had to take a lashing from investors who are growing increasingly unsettled about the profit-squeezing slump in demand for petrochemicals over the past quarter. Its second quarter numbers are due later this month. The stock opened at Rs 237, but closed 2.52 per cent lower at Rs 229.85; 16.14 lakh shares were dealt on the BSE, generating a turnover of around Rs 37.40 crore.
The Tata-controlled CMC was another company that had a bad day in the trading ring, crashing almost 20 per cent to Rs 427.60 after disappointing second quarter results. MTNL, brokers said, continued its losing streak and its share was down 7 per cent at Rs 96.