Sensex falls the lowest since Aug 2006, test below 11k level

Sensex falls the lowest since Aug 2006, test below 11k level

Mumbai: Amidst tumbling of stocks in Asia and Europe, the Bombay Stock Exchange benchmark Sensex plunged below 11,000 points in early trade on Wednesday for the first time in more than two years before rebounding to erase some of its losses but still ended the day lower by nearly 367 points.

The BSE bellwether lost a massive 954 points, or nearly 8%, at 10,740.76 points, the lowest level since August 2006. With domestic funds stepping in for the rescue act, the index regained 11,000 level and closed at 11,328.36, still lower 366.88 points from its previous close.

Similarly, the wide-based National Stock Exchange index Nifty fell by 92.95 points at 3,513.65, after dipping to 3,329.45 points at one stage.

Marketmen said selling pressure escalated on reports of steep fall in the US stocks, which is at a five-year low, while Japanese stocks plummeted to 20-year lows.

They said the market escaped a major fall on emergence of domestic funds buying amid short covering by speculators which partialy helped the trend.

As the selling spread over wide front, all the sectoral indices ended in red led by consumer durables, banking, information technologies and metal.

Investors remained jittery as the market has lost nearly 1725 points in the last four trading sessions on weak global trends following deepening of financial and credit crisis in the US which has now spread to Europe as well.

Meanwhile, the International Monetary Fund raised its estimate of losses tied to US loans and securitized assets to $1.4 trillion from $1.3 trillion two weeks ago. The IMF cut its forecast for global growth next year to 3% from 3.7%.