Market rout continues as Sensex slips 637 points and selling pressure mount

The BSE benchmark Sensex tumbled 637 points and the broader Nifty slipped below the 10,300-mark in late afternoon trade Friday following heavy selling in blue chip Reliance Industries as well as financial stocks. The 30-share Sensex, opened Friday distinctly weak at 34,563.29 and continued to slide to touch a low of 34,140.32 points (intra-day). The index was trading down 636.83 points, or 1.82 per cent at 34,142.75 at 1400 hrs. The 50-share NSE Nifty plunged 196.40 points, or 1.88 per cent, to 10,256.65. Index heavyweight Reliance Industries dropped 5 per cent to Rs 1,091.50 despite better-than-expected earnings posted by the company on Wednesday. RIL reported its highest ever quarterly net profit of Rs 9,516 crore, a 17.4 per cent rise year-on-year, for the July-September period. Traders said Reliance Industries' pre-tax earnings from the business declined for the second quarter in a row and this triggered the heavy selling in the counter. The operator of world's largest oil refining complex however saw pre-tax earnings from the business decline for the second quarter in a row. It fell 19.6 per cent to Rs 5,322 crore as margins dipped. In the first quarter the pre-tax earnings had fallen 16.8 per cent. It earned USD 9.5 on turning every barrel of crude oil into fuel as compared to a gross refining margin of USD 12 per barrel. The GRM was also lower than USD 10.5 per barrel earning in first quarter. Other big losers were Yes Bank, Hero MotoCorp, Bajaj Auto, Maruti Suzuki, Tata Motors, Coal India and L&T, falling by up to 5.91 per cent. Sentiments took a hit largely on sell-off in NBFCs, led by Indiabulls Housing and Dewan Housing Finance, which dropped over 15 per cent on prevailing liquidity concerns, dragging down the key indices down.