Indian equity markets joined the global meltdown yesterday, with the National Stock Exchange (NSE) witnessing its second-largest drop in a single day. The widespread carnage at the exchange saw 181 scrips hitting new 52-week lows during intra-day trading.
The NSE-50 (Nifty) recorded its sharpest intra-day trading crash of 92 points to drop to 1,028. However, it bounced back to close at 1,032.60, a fall of 88.20 points over the previous close of 1,120.80. The Nifty had recorded its biggest drop on March 31, 1997, when it lost 89.50 points. The Bombay Stock Exch-ange survived the slaughter as it was closed on account of Diwali holidays.
After opening at 1,120.60, the Nifty lost 44 points within the first half-hour and touched an intra-day low of 1028.20 before closing at 1,032. Almost 60 stocks touched the lower end of the circuit filter. For the first time in the history of the NSE, not a single stock gained value.
The stocks which lost significant ground included Tata Tea (close: Rs 365.85, fall of 10 per cent), Bajaj Auto (Rs 543.60, 9.99 per cent), Thermax (close: Rs 250.60, 9.99 per cent), ICICI ( Rs 84.05, 9.96 per cent) and Reliance Capital (Rs 59.35, 9.94 per cent).
The slide was triggered off by panic selling by foreign institutional investors (FIIs) and accentuated by heavy selling by local operators. Market sources said brokers who took long positions on the Bombay Stock Exchange also sold on the NSE yesterday to offset possible losses on the BSE.
According to brokers, domestic institutions may offer buying support in the next few trading sessions. Most liquid stocks outperformed the market on the downslide. Domestic financial institutions were buying towards the close of the trading session. However, the crash was inevitable. The buying support from domestic institutions will intensify as the Nifty inches towards the 1000 mark, a source at a leading institutional brokerage commented. Senior UTI officials admitted that the fund was buying in certain key pivotals. We are assessing every stock. We will buy at attractive levels.
