Indian equities markets crash on failed expectations (Lead)October 24th, 2008 - 2:49 pm ICT by IANS
Mumbai, Oct 24 (IANS) Indian equities markets opened weak Friday and then crashed around noon with a key equities index dipping even below the 9,000 mark immediately after India’s central bank, the Reserve Bank of India, announced that it had left all key rates unchanged in its mid-term review of the annual policy for 2008-09.“By announcing a slew of measures a few days before its scheduled mid-term review, the RBI had created expectations of some more measures and when they were not met Friday, the markets crashed,” said portfolio strategist Manoj Krishnan of Delhi-based financial services firm Price Investment Management & Research Services.
The benchmark 30-share sensitive index (Sensex) of the Bombay Stock Exchange opened more than 200 points down and then hit a low of 8,940.48 immediately after the RBI announced its mid-term review leaving all key rates unchanged.
It then recovered somewhat and at 12.45 p.m. it was ruling at 9,106.16, down 665.54 points or 6.81 percent from its previous close Thursday at 9,771.70 points.
The broader 50-share S&P CNX Nifty index of the National Stock Exchange (NSE) also opened weak, nearly 100 points down and then hit a bottom of around 2,675 at noon before recovering somewhat.
At 12.45 p.m., it was ruling 2723.40, down 219.75 points or 7.47 percent from its previous close Thursday at 2943.15.
The BSE midcap index was ruling at 3,198.58, down 180.14 points or 5.33 percent from its previous close Thursday at 3,378.72 points.
The BSE smallcap index was ruling at 3,765.48, down 200.22 points or 5.05 percent from its previous close Thursday at 3,965.70 points.