Sensex down by 279.08 points; settles at 14,255.93

Mumbai, June 6: The Sensex today crashed by a whopping 279.08 points on the Bombay Stock Exchange (BSE) to settle in the red at 14,255.93, tracking southward-bound global indices.

After opening firmer at 14,551.53 from the previous close of 14,535.01, it had reached an intra-day high of 14,590.82 and a low of 14,234.07.

On the other hand, the broader Nifty Index also tanked by 86.40 points on the National Stock Exchange (NSE) to settle in negative terrain at 4,198.25, from previous close of 4, 284.65.

During intra-day, it had reached a high of 4,324.10 and a low of 4,190.95.

''The markets, which were steady till early afternoon trade, started declining as fresh selling emerged. The fall kept on accentuating as the day progressed, with shares across the board seeing intense selling pressure. As per market talks, there was basket selling in Nifty stocks by a couple of foreign brokerages.

Cues from the global markets were not encouraging either. A broad based decline in European shares weighed on domestic bourses,'' traders said.

The total turnover on the BSE amounted to Rs 5,256 crore. Market analysts explained that the market breadth was quite weak here as small-cap and mid-cap stocks succumbed to selling pressure. There were a little over 2 losers for every gainer as 1,733 shares declined while only 852 advanced and 70 remained unchanged. This was in sharp contract to the trend in morning session, when 895 shares had advanced and 631 declined, they pointed out adding that among the Sensex pack, 26 dipped and the remaining four advanced.

The major losers today included Reliance Industries (RIL), ONGC, Wipro, Ranbaxy Laboratories, SBI, ICICI Bank, HDFC Bank, Tata Motors, Reliance Energy, HDFC, SAIL, Tata Steel and BHEL.

The prominent gainers were Hindalco Industries, Reliance Communications, Satyam Computers and Hindustan Lever.

Market analysts pointed out that there are concerns that investors may pull out funds from the secondary market to invest in initial public offerings (IPOs), which are scheduled to hit the market later this month. Reality major DLF is mopping up between Rs 8,750 crore and Rs 9,625 crore at the proposed price band of Rs 500 - Rs 550 per share. DLF IPO opens for subscription on Monday and ends on Thursday, next week, they said adding that ICICI Bank had earlier filed a draft prospectus with capital market regulator Securities and Exchange Board of India (SEBI) to seek approval for raising Rs 17,500 crore through an equity issue in the domestic and overseas market.

Foreign Institutional Investors (FIIs) were net sellers to the tune of Rs 148 crore yesterday and domestic institutions were net buyers to the tune of Rs 48 crore, traders disclosed.

All European indices were trading with losses. They fell for a third day in a row today as investors braced for possible warnings on eurozone inflation from the European Central Bank chief after a policy meeting later in the session. There are two seperate meetings of European Central Bank (ECB) and Bank of England (BOE) scheduled today. As per market expectations, ECB will raise interest rate to 4 per cent from the present 3.75 per cent, while BOE is expected to keep rates unchanged.

Most major Asian share markets tumbled and the dollar also slipped today, after comments from US Federal Reserve Chairman Ben Bernanke dashed hopes for an interest rate cut this year in Asia's top export market. Hang Seng was down 0.11 per cent to 20,818.61 while Nikkei 225 index slipped 0.07 per cent to 18,040.93.

The Shanghai Composite Index in China rose 0.24 per cent at 3,776.37 after a strong intra-day rebound yesterday. Chinese stocks had recovered yesterday on market talks that the government would soon issue a policy statement designed to restore investor confidence. The Shanghai Composite Index has fallen more than 10 per cent from a record high since Chinese authorities hiked a stock-trading tax a week ago to cool a market that had almost tripled in value over the past year, analysts tracking Asian markets said.

US stocks edged lower yesterday, after comments from Federal Reserve Chairman Ben Bernanke and a strong reading on the service sector suggested the central bank has little reason to lower interest rates. The Dow fell 80.86, or 0.59 per cent, to 13,595.46, after earlier falling more than 100 points. Broader indexes also retreated. The Standard&Poor's 500 index fell 8.23, or 0.53 per cent, to 1,530.95, while the Nasdaq composite index shed 7.06, or 0.27 per cent, to 2,611.23. Bernanke said inflation was still a major concern.

Oil prices rose amid forecasts that the strongest storm to hit the Arabian Peninsula in 60 years was barreling toward Iran, a major oil producer, and the oil-rich Persian Gulf. Light, sweet crude for July delivery added 23 cents to USD 65.84 a barrel in Asian electronic trading on the New York Mercantile Exchange, mid-morning in Singapore. The contract had slipped 60 cents to settle at USD 65.61 a barrel yesterday.

UNI