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Nifty flat amid late sell-off; FO expiry, Rail Budget eyed

16:36

The News International Team

After the sell-off in last hour of trade, the market closed flat on Wednesday ahead of expiry of February derivative contracts and Railway Budget. The 30-share BSE Sensex had rallied 265 points intraday before closing with gains of just 3.33 points at 29007.99.

The 30-share NSE Nifty failed to hold the 8800-mark, rising 5.15 points to close at 8767.25. However, the BSE Midcap and Smallcap indices ended marginally down.

The volatility in last few sessions suggests that investors continued to be cautious ahead of the Union Budget (to be presented on Saturday).

The market is already overbought and is likely to wait for the event to get over before showing a confirmed trend. So it is unlikely that there would a big post-Budget rally, says Vikas Khemani, President & CEO, Edelweiss Securities.

According to him, most of the market’s expectations have are already been laid down by the government, so the focus will now be the vision of the government in terms of capital expenditure plans.

On Railway Budget, Khemani says since the Prime Minister has made it clear that railways would be the engine of growth, the industry is expecting lot of investments into the sector.

Shares of rail stocks succumbed to heavy selling pressure ahead of Rail Budget tomorrow. Stocks like Titagarh Wagons, Kernex Microsystems, Hind Rectifiers and Texmaco ended with loss of 3-6 percent.

Banks, capital goods, pharma, metals and select auto stocks saw selling pressure in last hour of trade.

Dr Reddy’s Labs topped the selling list on Sensex, falling 2.5 percent on reports that Attorney Generals of Texas and California have separately sought information on pricing of some drugs sold by Dr Reddy’s Laboratories in the US.

Among others, Sun Pharma, Tata Steel, HDFC Bank, ICICI Bank, TCS, Larsen & Toubro, HUL and Hero Motocorp were prominent losers, down 1-2 percent.

However, HDFC kept its top position in the buying list throughout the session, up 2.4 percent. Infosys, ITC, Wipro and Bharti Airtel gained 1-1.8 percent but Reliance Industries trimmed gains to close with marginal gains.

In the broader space, cement manufacturer Dalmia Bharat hiked stake in OCL India, triggering a merger buzz. Dalmia Bharat gained 3 percent while OCL India tanked 12 percent.

ABG Shipyard was up 14.5 percent as media reports suggested that the Mahindra group is looking to acquire a controlling stake in debt ridden ABG.

South Indian Bank climbed 4 percent as the Reserve Bank of India allowed foreign institutional investors to buy shares of the private sector lender. Steel Strips Wheels rose 5.4 percent on getting export order from Renault Brazil.

The market breadth was weak as 1661 shares declined and 1229 shares advanced on the Bombay Stock Exchange.

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