Mumbai: The Bombay Stock Exchange benchmark Sensex recovered from early losses to regain the 14,000 points level on emergence of buying by foreign and domestic funds at the existing low levels and ended at 14,009.90 points.
The 30-share index, which plunged to 13,805 points for the first time in more than two months, witnessed the day’s high of 14,036.61 before ending 81.08 points lower at 14,009.90 points.
The market turned more volatile and created cracks in the benchmark Sensex after the Reserve Bank increased the cash reserve ratio (CRR) on 13 February, on concerns of further hike in inflation.
However, the wide-based National Stock Exchange index Nifty rose by 2.55 points at 4,047.10, after falling below the key level of 4,000 points level at 3965.20, and witnessing the day’s high of 4057.35 points.
State Bank of India, the country’s biggest lender, fell Rs.71.45, or 6.1%, 1,101.25. ICICI Bank Ltd., the second largest, dropped Rs.39, or 4.1%, to 915. HDFC Bank Ltd., India’s third-biggest by market value, declined Rs.55.15, or 5.2%, to 1,016.65.
“The markets reacted to the monetary tightening but appear to be bottoming out at these levels. We would see a surge closer to the union budget,” said Hiten Mehta, fund manager with Fortune Financial Services.
Finance minister P Chidambaram will unveil the budget on 28 February.