Reliance Ind a dangerous stock for Nifty now

CNBC-TV18's Managing Editor, Udayan Mukherjee - It is not good when Nifty is at crossroads, just about on the knife-edge of 4,000 and deciding which way to go. One would like to see strength in the biggest stock in the market but Reliance is wobbly, it went to 2,300 and first provocation has darted it back to Rs 2,000 again. So will we see sub-Rs 2,000 on Reliance today, which is very likely if the Nifty opens 2% down then once again swords will be out that stock is breaking down. 
 
I don’t know if this sharing of profits is a big reason for Reliance Industries to break down. I can understand a Cairn getting hit but it is not like a huge amount of Reliance’s profits will suddenly go to the government. That is not conceivable. So my sense is that it was used as an excuse to pummel that stock down because it was looking technically weak in any case.
 
I think bears have made money in reliance first time in many years over the last one month or so. People who have shorted Reliance made money. There is a feeling that every weakness that we see in that stock, we need to pounce on it and yesterday shorts opened up in that counter once again.
 
This is a dangerous stock for the Nifty right now. It has been a pillar for the last many years but in the last two months it has been a source of weakness for the Nifty. And in the current environment with sentiments sullied by the oil profit sharing thing, the windfall cess, Reliance might actually struggle a little bit which is not good news for the Nifty. The more time Reliance spends below Rs 2,000, the more chances of Nifty breaking below the 3,850 mark because Reliance drags down the index quite a bit.
 
For Reliance Comm, today may not be the D-Day because the kind of noise coming from camps of both brothers is that they are going to spar some more. And in this environment, I cannot imagine the deal will be struck and concluded by MTN.  So maybe they buy some more time, they linger on for 3-4 weeks but the Reliance Comm stock is also under pressure, I don’t know for what reason.
 
I think the bears sensed that there is a opportunity for both Reliance and Rel Comm on the way down because of the way news flow is panning out and the way these stocks have moved. Reliance Petroleum too, I suspect though it has been a much stronger stock than Reliance Industries off late will also follow Reliance in this kind of tricky news environment. The Reliance Group stocks will probably cause little bit more grief for the Nifty now rather than help it out in its time of need.