India’s most-followed share index swung by a wild 1,096 points in volatile trading on Tuesday, a day after its record 2,111-point surge, but closed with a mere 17 point gain – or 0.1 per cent. The National Stock Exchange’s Nifty was less volatile, and closed with a 0.1 per cent loss.
Profit-booking by sellers and buying by those who had taken bearish positions caused a tug-of-war that caused the index to move like a yo-yo.
While the UPA’s election victory made the markets euphoric on Monday, information technology shares took a beating on Tuesday as a strengthening rupee clouded their earnings outlook.
While the realty index at the BSE was up 12.8 per cent, the IT index fell steeply by 10.1 per cent during the day. The major losers were Infosys, Wipro and TCS.
The Sensex opened with a gain of 463 points, surged to a day’s high 14,930 – a short distance away from the psychologically crucial 15,000-mark – before losing 630 points to close at 14,302.
The Nifty started up by just one point at 4,324 and touched an intraday high of 4,509 before losing 191 points to end at 4,318. “There was lot of push and pull between the investors who were short in the market and the ones who were in for profit-booking,” said Gaurav Dua, head of research, Sharekhan.
The Sensex alone saw a turnover of Rs 4,761 crore on Tuesday as the number of shares traded stood at 8.94 crore. “Many people were in pain for quite some time (as they were waiting for stocks to rise) while the short covering came as a result of what happened yesterday,” said Sudip Bandyopadhyay, managing director, Reliance Money.