Markets plunge, Nifty below 5K

The Indian markets plunged, as investors showed their unhappiness with the policy-paralysed govt. The Nifty broke the psychological 5K mark. Good inflation numbers also didn’t do much to cheer up the market sentiment. All the indices are trading in the red, with Capital Goods, Realty, Metals and Power featuring among the worst performers.

Primary Articles' inflation decreased by 82 bps to 6.92% for the week. Food inflation dropped to 6.6% versus 8%, while Fuel inflation remained unchanged at 15.53% for the week ended Nov 26, 2011.

The other Asian markets continued with their morning losses. Shanghai gave up its initial gains, and is following the Hang Seng and Nikkei, both of which are trading in the red zone.

European markets opened higher on the hopes that European leaders will try and sort out the European debt crisis when they meet.

Back home, Jaiprakash Associates is among the leading index loser, down 4.70% to Rs 66.95. DLF is also trading down 3.22% to Rs 217.60. The Metals pack is also not doing too well, with Hindalco, Sterlite Industries and Tata Steel down in the range of 2%-4%. Stocks like SBI, RIL and BHEL are also trading down by more than 2%. Other stocks like Tata Power, HDFC, Infosys and Jindal Steel are trading marginally in the red zone.

On the other hand, Wipro is the lead index gainer, up 2.04% at Rs 412. Other stocks like Cipla, Sun Pharma, TCS, Bajaj Auto, and Hero MotoCorp are trading marginally in the green zone.

Suven Life Sciences is up 1.36% to Rs 14.96, after the company secured 4 product patents for new chemicals in Australia and Canada.

GAIL India is down 1.85% to Rs 394.90, after the company tied up a US$ 100 million loan from the Bank of Tokyo.

The market breadth, which indicates the overall health of the market, is very weak. On the BSE, 1832 shares fell, 692 shares rose and 108 shares remained unchanged.

We expect the markets to remain volatile for the rest of the day, and advise readers to play with caution.