Sensex recovers early losses to regain 9k level

Sensex recovers early losses to regain 9k level

Mumbai: The benchmark Sensex pared the early losses, by rising 126 points in the late Monday morning trade after reports that the US government would provide Citigroup $20 billion to protect the banking giant from the possibility of unusually large losses.

The Bombay Stock Exchange barometer, which opened lower by 206.36 points, bounced back by 126.81 points, or 1.42 per cent, at 9,042.02 points at 10:45am.

The wide-based National Stock Exchange’s Nifty rose by 46.90 points, or 1.74%, at 2,740.35 after dipping to 2,641.65 in opening trade.

Marketmen said reports that the Treasury Department, Federal Reserve and Federal Deposit Insurance Corporation reached an agreement with Citigroup to provide a package of guarantees to the struggling banking giant, helped stocks particularly of banking sector rebound.

The Treasury Department will invest $20 billion in Citigroup from the 700-billion-dollar rescue package approved by Congress earlier.

Shares of country’s largest state-run lender SBI rose by 24.85, or 2.10%, at ,208.

The Sensex fell over 206 points in early trade on fresh selling by funds, tracking other Asian markets amid uncertainty over the fate of Citigroup.

The 30-share index, which had gained 464.20 points in the last session, fell by 206.36 points, or almost 2.31% at 8,708.85 after all the sectoral indices, led by banking stocks suffered setback.

Similarly, the wide-based National Stock Exchange’s Nifty moved down by 51.80 points, or 1.92% at 2,641.65.

Among banking stocks, country’s largest lender, State Bank of India fell by Rs20, or 1.8% at Rs1,163,ICICI Bank lost Rs12.40, or 3.90% at Rs323.15, while HDFC Bank moved down by Rs49.60, or 5.5% at Rs807.10.

Other draggers were Reliance Industries, Infosys Technologies, Tata Consultancy, Wipro, Tata Steel, Tata Motors, Larsen and Toubro, DLF Ltd and Grasim Industries.

Meanwhile, Hong Kong’ Hang Seng fell by 1.62%, Singapore’s index lost 1.20% in early trade while Japan Stock Exchange remained closed for a local holiday.