Shares of Reliance Industries fell sharply on Friday after traders fretted about the possible impact of the detention of one of the company’s employee over alleged leakage of official documents from the petroleum ministry.
However technical analysts attributed the fall of the Reliance stock to the company’s weak show on the charts which combined with the broader market move to book profits.
The Reliance stock which opened at Rs 897 on the Bombay Stock Exchange, fell to a low of Rs 872 toward the close of trading, a decline of about 3%, with almost 575,000 shares of the company being traded on the day. The BSE ended the day down 0.7% at 29,231 points, a fall of about 231 points.
“The market was definitely concerned about the developments in Delhi related to the alleged leaks as it can have an adverse impact,” said the research head of a leading Mumbai-based brokerage who asked not to be named as the matter is sensitive.
Delhi police have so far arrested seven persons in the case, including petroleum ministry employees and energy consultants. They also raided the Delhi office of Reliance Industries Limited (RIL) and picked up an employee for questioning.
Reliance Industries said it has been brought to the company's notice that one personnel has been detained by law-enforcement authorities
RIL has been locked in a dispute with the oil ministry after it was made to give up a portion of the gas fields in the Krishna-Godavari basin, and the two sides are scheduled to begin an arbitration process.
Friday’s fall on the BSE snapped a seven day winning period as traders sold shares to book profits and foreign investors exited index derivatives.
“It was mostly due to profit booking,” said Amir Muzzafer Mir, senior technical analyst with HBJ Capital. “The markets have been on an uptrend for the past seven sessions and today most investors wanted to book the gains,” he added.
Attributing the Reliance stock fall to a weak showing on the charts, Mir said that Reliance had been trading below the 200-moving day average. “In such cases, shares typically move slow. We see support at Rs 860 levels. If it breaches that, then the next level would Rs 830,” he added.