Markets slip on news of Wipro ban

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Mumbai: The market movement, on Monday, was dominated by the news that Wipro was banned by the World Bank for four years. This, along with the fact that the market regulator will be checking accounts of all the index companies, caused a sell-off in most of the pivotals. Only two companies on the Sensex gained on Monday.

During the day, weak cues from Asian and European markets and the expectation of tough quarterly earnings dampened sentiments. Subsequently, the benchmark 30-share Sensex of the Bombay Stock Exchange (BSE) closed lower by 296.42 points, or 3.15%, at 9,110.05 points. The broader S&P CNX Nifty of the National Stock Exchange (NSE) was down by 99.90 points, or 3.48%, to close the day at 2,773.10 points.

An analyst from a leading broking house said, "Apart from weak global cues today, the news that the World Bank had banned any business with five entities in India, including Wipro and Megasoft, also had a major impact on the markets."

However, scandal-scarred Satyam jumped over 44% on hopes that a government-appointed board will rescue the company. The appointment of Deepak Parekh and other key members on the board also added some hope.

Arun Kejriwal of Kejriwal Research & Investment Services said, "After the last few days of negativity in the markets, all eyes are on Infosys' quarterly results, which are slated to be declared on Tuesday. I think that now onwards, the markets will take cues everyday from results. It is very difficult to predict the outlook of the markets in the results season."

"apart from the anticipation surrounding results, we also witnessed some selling from foreign institutional investors (FII), which had a negative impact on the markets. From this point in time, everything depends on the quarterly results," added Kejriwal. Overseas investors were net sellers to the tune of Rs 177.90 crore on Monday.

The Index of Industrial Production numbers for November 2008 stood at 2.4% as compared to a negative of 0.4% in the previous month.

All sectors in the BSE Sectoral indices ended the day in red, with metal, realty and IT being the worst performers of the day. The IT index fell by 3.80% on Monday.