Sensex crashes by over 144 points in opening trade

Mumbai, May 25: For the third consecutive session, the 30-scrip Sensex today opened in the red with a whopping loss of 144.50 points on the Bombay Stock Exchange (BSE) at 14,073.61 from it's previous close of 14, 218.11 on weak global cues.

It however, recovered marginally to trade at 14,205.87 during early morning trade.

The broader 50-stock Nifty Index also opened with a marginal loss of 7.05 points on the National Stock Exchange (NSE) at 4,197.85 from it's previous close of 4,204.90 point, but later slipped further into negative territory at 4, 192.50 in early trade.

In the first session, the total turnover on BSE was Rs 658 crore.

The market breadth was weak as 970 shares declined while 596 advanced. Among the Sensex pack, 26 were losers, while only four advanced, traders disclosed.

Banking stocks were under selling pressure on rumours of the Reserve Bank of India (RBI), which has already raised the cash Reserve Ratio (CRR) thrice since December 2006, contemplating another hike, though only on incremental deposits this time. There is a buzz in the market that the decision can come today evening.

CRR is the percentage of deposits that banks are required to keep with the RBI, analysts observed.

The losers included the State Bank of India, ICICI Bank, HDFC, Index heavyweight Reliance Industries (RIL) and HDFC Bank.

The prominent winner was State-run power generation major NTPC.

The market is likely to stay cautious ahead of official data on inflation which will be released around noon. Annual inflation in the previous week was 5.44 per cent, experts noted and added that the market is seriously worried about big initial public offerings (IPOs) lined from next month onwards. It is believed to be the highest-ever capital mobilisation. Lot of liquidity will be sucked off from the secondary market. This will make its way to the primary market.

The annual monsoon is predicted to strike the Kerala coast day after tomorrow, four days ahead of its normally scheduled date of arrival on 1 June this year. From Kerala the monsoon travels upwards to the parched central Indian plains. Subsequently, New Delhi will witness showers by the end of next month.

Asian markets were trading weak. Japan's Nikkei plunged 1.59 per cent or 280.86 points at 17,416.11, while Hong Kong's Hang Seng index tumbled 1.38 per cent or 286.48 points at 20,512.49.

Wall Street retreated yesterday. The Dow Jones industrial average fell 84.52 points, or 0.62 per cent, to 13,441.13.

Broader stock indices also declined. The Standard&Poor's 500 index lost 14.77 points, or 0.97 per cent, to 1,507.51, and the Nasdaq composite index fell 39.13 points, or 1.52 per cent, to 2,537.92.

UNI