MUMBAI: The equity markets gave up almost all their gains after hitting a fresh life time high on Monday as mining stocks plunged sharply following the Supreme Court ruling that all coal block allocated by the government between 1993 and 2009 were illegal. After hitting a record high of 26,630.74, the Sensex pared most of its gain to finally end at 26,437.02, marginally up by 17.47 points or 0.07 per cent. Nifty closed the day down 6.90 points at 7,906.30.
“It was a temporary knee-jerk reaction following the SC ruling on coal blocks allocation, which saw heavy selling in the shares of metal companies. I believe the market would stabilise once more clarity emerges on whether the companies having coal mining activity would be allowed to carry on their operation under the new policy to be framed by the government,” said Deven Choksey, managing director, K.R. Choksey Securities.
On Monday, the shares of Jindal Steel & Power tanked 13.97 per cent while that of Hindalco Industries and Sesa Sterlite plunged 9.56 per cent and 3.89 per cent respectively. Among the sectoral indices, the metal index was the loser, down by 4.34 per cent. According to the provisional data provided by the stock exchanges, FPI purchased shares worth Rs127.33 crore. However, the broader market remained weak with 1,659 stocks on BSE closing deep in red as compared to 1,358 stocks that declined.
“Things look ripe for further strengthening of the markets. Lower crude oil prices and ECB’s decision to continue with its monetary easing policy would favour emerging markets like India,” said Vinod Nair, head of fundamental research, Geojit BNP Paribas Financial Services.
