Worst Sensex closing in 2006

414 pt fall to 9,063; Rs 1,15,687 cr m-cap lost.

Intense selling today brought the BSE Sensex to its lowest closing of 2006. Weak global markets and worries over inflation and higher interest rates continued to drag stock prices down to sharply lower levels on the major Indian bourses.

Weighed down by a near 100 point loss in the Dow yesterday, the Sensex opened with a big negative gap and could not make any substantial recovery.

The 30-share sensitive index ended with a loss of 413.50 points at 9,062.65. The NSE Nifty shed 113.55 points to settle at 2663.30, marginally above its intra-day low of 2638.

The Sensex dipped below the 9,000 mark to touch its intra-day low of 8,993.58 during the afternoon session, the first time it has moved below the 9,000 mark since December 9, 2005.

With today's fall, the Sensex has registered a loss of over 28 per cent from its highest level of 12,671. Market analysts term a 20 per cent loss in the market a bear phase.

The Nifty has shed over 29 per cent since May 11, 2006. The mid-cap and small-cap stocks continue to be the worst affected in this market. The CNX mid-cap index is lighter by 35 per cent since May and the BSE's small-cap index has shed over 40 per cent in just over a month of trade.

Today's fall also shaved off Rs 1,15,687 crore in market capitalisation, bringing it down to Rs 23,84,117 crore. Since May 10 when the Sensex reached its peak, investors' wealth has been eroded over 31 per cent, or Rs 10,87,008 crore, from Rs 34,71,125 crore.

Following a weak close on Wall Street and amid rising fears of inflation and further hikes in interest rates, stocks on Asian bourses fell sharply today and this proved a strong enough trigger for the bears. The weakness was seen across all global markets "" Asia, Europe, the US and the UK and the Sensex tracked this weakness.

The Nikkei share average plunged 4.14 per cent today to record its biggest one-day percentage loss since May 2004. Hong Kong's Hang Seng index fell 2.48 per cent.

With metal stocks firmly remaining out of favour, Tata Steel was the biggest loser among the Sensex stocks.

The scrip lost 8.5 per cent on trade today to close at Rs. 390.45. Bhel shed 7.76 per cent to close at Rs. 1608.65 and Hero Honda ended trade at Rs. 657.85, down by 6.99 per cent.

ONGC was spared the intense selling pressure that some of the other counters witnessed, ONGC closed marginally in the green at Rs. 984.10, while SBI gained Rs. 5.60 and ended trade at Rs. 750.95.

State Bank of India stood firm and gained 1 per cent but other bank stocks had a free fall. Among public sector banks, Syndicate Bank and Punjab National Bank lost 9 per cent and Union Bank closed at Rs 87, shedding 7.6 per cent.

Among private banks, HDFC Bank fell by over 5 per cent to Rs 652 and ICICI Bank over 3 per cent to Rs 460.

Metal stocks melted with National Aluminum losing 3.5 per cent to Rs 201, Sterlite Industries 11.6 per cent to Rs 281 and Hindustan Zinc 8.5 per cent to Rs 464.

The market saw a ray of hope around noon yesterday when a few blue chips bounced back into the reckoning thanks to bargain hunting after a steep fall, but there were no such rallies today.

The market opened on a weak note this morning, struggled right through the session and ended on a bleak note.

Hemang Raja, MD and CEO, IL&FS said, "All the global markets are jittery owing to fear of hike in interest rates affecting the global flows in the emerging markets. Here onwards, it is not the question whether the index has bottomed out or not as there are many value-picks easily available. The mid caps are trading at unrealistically low prices and my advice to retail investors is to invest in equities through SIPs and mutual funds to make good their losses."

According to the provisional figures from the NSE, FIIs sold shares worth net Rs 171.14 crore in the cash market today.

While the turnover on the BSE amounted to Rs 2,708.27 crore, on the NSE it stood at Rs 5576.11 crore in the cash segment and Rs 19,183.63 crore in the derivatives segment.

With stocks across the board succumbing to the pressure, the market breadth remained weak right through the day. Out of the 2,400 stocks traded today, 271 advanced, 2083 declined and 46 remained unchanged from their previous closing levels.