Nifty had hit a high of 1430.7 points on September 9 and has skidded 7.16 per cent since then to close at 1328.2 points on September 23. Over the same period, the losses in the Nifty Junior have been much lower.
Market sources say that foreign institutional investors (FIIs) have been churning their portfolios and booking profits at higher levels in the past two weeks. FII investments are largely restricted to the heavyweight stocks, which enjoy high liquidity.
The sharp decline in Nifty is a result of profit-booking at higher levels in heavyweight stocks like Hindustan Lever, Wipro Ltd, Satyam Computer, State Bank of India, Ranbaxy, ACC, Steel Authority and Digital Globalsoft in the past couple of weeks.
Profit-booking in the pharmaceutical stocks has seen Ranbaxy Labs plunge 13.41 per cent since its peak of Rs 1,075.05 on September 9 to Rs 930.9 on September 23. Wipro, ACC and Steel Authority have also dropped 11.39 per cent, 11.35 per cent and 12.76 per cent from their highs on September 9. Other heavyweights like Hindustan Lever, Satyam Computer, State Bank of India and Digital Globalsoft have skidded 8-9 per cent during the period.
The Nifty Junior has been aided by gains in certain stocks like Moser Baer, i-flex Solutions, Hughes Software and IDBI.
These stocks have high weightage in Nifty Junior index. Besides, lower losses in certain banking and public sector stocks like Punjab National Bank, Bank of Baroda, Container Corporation and Bharat Electronics also made the Junior index outperform the benchmark Nifty.
Moser Baer has gained about 15 per cent since its high on September 9 to close at Rs 368.85 on September 23. The compact-disc manufacturer has also surged over 30 per cent during the month so far. Similarly, i-flex has gained 2.26 since its high on September 9 and 18.75 per cent during the month so far. On September 23, the stock closed at Rs 734.2.