“Overall technical data indicates that we can see weakness in the market. Nifty futures have support around 3850 levels which can be treated as stop loss levels for trading long positions. One can buy Nifty 3900 or 3800 strike price put to hedge the long position or portfolio if Nifty trades below 3950 levels,” said a strategist note by Anand Rathi Securities.
At 10:40 am, Bombay Stock Exchange’s Sensex was trading at 13,293.21, lower by 211.01 points or 1.56 per cent from Friday’s close. The index drifted to a low of 13,256.73 after opening at 13,405.95 in trade so far.
National Stock Exchange’s Nifty was at 3948.60, down 1.38 per cent or 54.8 points. The index dipped to a low of 3931.60 so far.
“There isn't any major development over the weekend which can swing the sentiment bull's way. Markets closed on an extremely weak note on Friday and the same is likely to continue Monday morning. For the past couple of weeks, monsoon seems to have picked up but it is still not satisfactory. The cumulative seasonal rainfall from June 1 was still 36% below normal till July 8. If rain gods were to remain elusive, we may face a draught like situation. We will wait for the next two weeks and cross the bridge when it comes. Indices are set to open lower, and at lower level we may witness bouts of short covering. Below 13400, there is not any real support till 12900,” said Anagram Stock Broking.
The broader market faced heavy selling pressure. The BSE Midcap Index lost 2.21 per cent while the BSE Smallcap Index lost 2.4 per cent.
Among frontline stocks, Jaiprakash Associates (-3.89%), DLF (-3.64%), Reliance Infrastructure (-3.62%), Tata Power (-3.61%), Larsen & Toubro (-3.28%) were badly hit.
Sun Pharmaceuticals (2.16%), Infosys Technologies (1.15%) and Wipro (0.34%) were the only gainers.
Market breadth on BSE showed 1451 declines against 318 advances.
Shares of Gammon India plunged after the collapse of a part of an underconstruction Delhi Metro line which is the second accident involving the construction company in two years. Five people were killed and 15 injured when a part of the elevated underconstruction metro track came crashing down near Kailash Colony in south Delhi on the Central Secretariat-Badarpur section slated to open by September 2010 when the Commonwealth Games are to be hosted in the city. The stock was trading 9.86 per cent lower at Rs 145.30 on the BSE.
Meanwhile, technology stocks gained momentum amid reports that Israeli tech firms are looking at emerging markets such as India and China for contracts, especially in e-governance projects.
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