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Sensex makes partial recovery, ends 232 points down

Sensex makes partial recovery, ends 232 points down
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First Published: Fri, Aug 10 2007. 04 36 PM IST
Updated: Fri, Aug 10 2007. 04 36 PM IST
By Agencies
Closing
Mumbai: The benchmark Sensex on 10 August lost 232 points to close well below 15,000 on panic selling by funds as well as retail investors after a meltdown in global markets on fears about a spreading credit crunch.
The Sensex, which had tumbled nearly 530 points in early trade, recovered partially to close down by 231.90 points, or 1.54%, at 14,868.25. It had lost nearly 207 points in the previous session.
In a similar fashion, the wide-based National Stock Exchange’s Nifty fell 69.85 points to 4,333.35, after touching an intra-session low of 4,239.20 and a high of 4,395.50.
Stock brokers said sustained fall in stock prices for the second straight session was mostly attributed to global nervousness due to the US subprime crisis that is now affecting European banks as well. This sparked panic selling by major players in the domestic bourses.
However, covering up of short position by speculators trimmed early losses in most of the stocks, they said.
Barring IT, all the key sectoral indices ended in the red with sharp losses.
The IT sector index ended 40.26 points higher at 4,774.13 points after Infosys Technologies gained Rs16.25 at Rs1,952.25, HCL Technologies by Rs11.85 at Rs323.80, Satyam Computer by Rs12.30 at Rs479.40 and Mphasis by Rs6.80 at Rs297.70.
Mid Day
Share prices were down 2.65% in mid-day trade with investors spooked by concerns of a credit crunch linked to the troubled US mortgage sector, dealers said.
They said the market recovered slightly from a morning plunge of 3.6% in the benchmark 30-share Mumbai stock exchange Sensex index, but concerns remained about further declines.
At 2 p.m., the Sensex was down 379.75 points at 14,720, off the day low of 14,570.89. The NSE Nifty on the other hand plunged 114.85 points at 4,288 points.
Overseas funds have led the fall by selling almost a billion dollars of Indian equities in the past two weeks to take total overseas equity investment to $9.7 billion this year from a high of $10.5 billion, official data showed Thursday.
Dealers said liquidity on the main bourses, the Mumbai and National stock exchanges, had dropped noticeably in line with markets around the world.
“Liquidity has become a concern. Local mutual funds may face redemptions in weeks ahead if the global volatility continues,” said Hiten Mehta, a fund manager with Fortune Financial Services.
Another market watcher said he expected further drops in Indian equities.
“We expect a painful correction in the coming weeks,” said Atul Mehra, capital markets chief with brokerage JM Financial.
On Friday, India reported that inflation rose marginally from a week ago while June industrial slowed from May.
Inflation rose 4.45% for the year ended July 28, from 4.41% a week earlier as the food costs gained, official data showed.
Also on friday, the government reported that industrial output rose 9.8% in June from a year ago, a sharp slowdown from an 11.1% gain in May as mining growth waned.
Opening
Mumbai: The benchmark Sensex tumbled more than 509 points on 10 August to go below 15,000 mark in morning trade on heavy selling by funds following a meltdown in global markets on fears about a spreading credit crunch.
The BSE-30 shares index, which had closed down by 207.83 points on 9 August, lost another 509.82 points, or 3.38% at 14,590.33 in the first five minutes of trade. Similarly, the National Stock Exchange’s Nifty plunged 164 points, or 3.07% at 4,239.20.
Stock brokers said reports that French BNP Paribas has frozen accounts of three mutual funds triggered panic selling by funds. All the BSE-30 index and Nifty-50 stocks were in the red with steep falls.
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First Published: Fri, Aug 10 2007. 04 36 PM IST
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