Spreading contagion brings key equities index below 10,000 (Roundup)October 23rd, 2008 - 7:07 pm ICT by IANS
Mumbai, Oct 23 (IANS) With the contagion of the financial tsunami that began in the US spreading to all parts of the world, jittery investors went into a selling spree once again Thursday sending a key Indian equities index below the psychologically important 10,000 mark.The markets finished in the red for the second successive day this week after two successive days of gain early this week and three successive days of losses last week.
The rupee too hit its lowest ever value against the dollar Thursday with the Indian central bank, the Reserve Bank of India’s (RBI) reference rate going down to Rs.49.79 to a dollar.
The RBI reference rate is based on 12 noon rates of a few select banks in Mumbai.
At the close of trading, the benchmark 30-share sensitive index (Sensex) of the Bombay Stock Exchange finished at 9,771.70, down 398.20 points or 3.92 percent from its previous close Wednesday at 10,169.90 points.
The Sensex opened very weak at 9,683.41, down 486.49 points or 4.8 percent from its previous close Wednesday, hit a low of 9,681.28 and then recovered enough to get into positive territory on short covering before sliding again to finish in the red.
The broader 50-share S&P CNX Nifty index of the National Stock Exchange (NSE) also opened weak and went below the psychologically important 3,000 mark before recovering somewhat to get into positive territory for a few minutes before falling again to finish at 2943.15, down 122 points or 3.98 percent from its previous close Wednesday at 3065.15 points.
The BSE midcap index finished at 3,378.72, down 111.67 points or 3.20 percent from its previous close Wednesday at 3,490.39 points.
The BSE smallcap index closed at 3,965.70, down 145.99 points or 3.55 percent from its previous close Wednesday at 4,111.69 points.
Despite lower Indian inflation figures and several positive measures announced by the Indian government, central bank and the market regulator over the past few days, continued uncertainty across the globe was affecting sentiment, analysts said.
“Argentina has now joined the list of countries hit by the financial tsunami,” said Jagannadham Thunuguntla, head of the capital markets arm of India’s fourth largest share brokerage firm, the Delhi-based SMC Group.
“After Iceland, Hungary and Pakistan, the emergence of the contagion in Argentina shows that Europe, East Europe, South East Asia and now Latin America too has been affected indicating the depth and width of the problem,” he said.
Overnight the New York Stock Exchange’s key industrial index closed 6.95 percent down while the key index of the Nasdaq - the stock exchange for technology stocks - finished with a 4.77 percent loss.
Asian markets also provided negative cues with the Nikkei index of the Tokyo Stock Exchange down 2.46 percent and the Hong Kong market’s Hang Seng down 4.65 percent.
Except consumer durables and consumer goods all other sectoral indices finished in the red.
The worst hit were metals, automobiles, oil and gas and realty stocks in that order.
Among the stocks that make up the Sensex, Grasim Industries gained the most, 4.74 percent followed by BHEL 2.74 percent, Larsen & Toubro 2.43 percent and HDFC Bank 2.23 percent.
The biggest losers were Tata Steel shedding 14.85 percent followed by Tata Motors 14.57 percent, Hindalco 13.10 percent and Ranbaxy Laboratories 10.94 percent.
As many as 1,908 or 73.50 percent stocks declined, 622 or 23.96 percent scrips advanced and 66 or 2.54 percent stocks remained unchanged.