The Telegraph
Since 1st March, 1999
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Poll number game nags markets

Mumbai, April 19: Poll plunge — that sums up the day on stock exchanges overrun by fears of a fragile mandate for the new government slated to take over next month.

Dalal Street, fretting about a pre-poll survey that showed the ruling coalition’s lead narrowing, saw the BSE sensex shed 61 points to close a whisker above 5800.

Analysts are of the belief that markets will remain range-bound, though there could be brief spells of volatility till the election process is completed and a clear picture emerges towards the middle of next month.

Most operators are unanimous in their opinion that financial numbers for the fourth-quarter of the year ended March 31 will be positive, but they feel this will not be enough to overwhelm those who will hold back fresh share purchases because of uncertainty over elections.

The NDA government is widely expected to come back to power, but observers are not sure how strongly. The first phase of the elections kicks off on Tuesday, when voters in 13 states will head for the ballot.

“Market players are adopting a cautious approach on the eve of the elections,” says Jignesh Shah, portfolio manager at ASK RJ. Shah pointed to the spate of poll surveys which have forced people to adopt a wait-and-watch stance before committing their funds to the market.

Sources said there was another reason for the BSE sensitive index to suffer losses: the fact that the futures market was quoting at a hefty discount to the cash section.

This morning, the 30-share barometer opened at 5875.53, hit an intra-day high of 5895.17 and a low of 5782.37, before ending at 5800.54 against its previous close of 5861.63. It was a fall of 61.09 points, or 1.04 per cent.

The volume of business increased to Rs 2200.15 crore from Rs 978.38 crore on Saturday. Power Trading Corporation remained the top traded scrip with a turnover of Rs 135.44 crore. It was followed by Biocon (Rs 124.41 crore), SBI (Rs 117.03 crore), Maruti (Rs 115.25 crore) and Reliance Industries Limited (Rs 112.04 crore).

Reliance slipped 2 per cent despite expectations of stronger fourth-quarter earnings. Other old-economy shares like Tata Motors, Bajaj Auto and Tisco also ended weak; cement and oil stocks did not have a good day either.

However, shares of some banks were big draws, chased by institutional buyers. ICICI Bank firmed up Rs 7.65 to Rs 299.85, HDFC Bank gained Rs 1.80 to Rs 377.90 and Corporation Bank jumped Rs 15.40 to Rs 333.50.

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