Sensex plunges on rising inflationary data

By Staff
|
Google Oneindia News

Mumbai, Aug 10: The Bombay Stock Exchange (BSE) Sensex today plunged by 231.90 points to settle in the red at 14,868.25 on weak global cues, rising inflation and discouraging industrial production data.

''The barometer index had crashed by a whopping 530 points in early trade, tracking weak global cues. However, it kept on recovering as the day progressed on value-buying coupled with short-covering. Ultimately, it settled near the day's high of 14,901.31. Trading was marked by a high degree of volatility. All the indices on BSE, except the BSE IT index, settled lower. European indices were trading lower today,'' market analysts said.

Similarly, the broader National Stock Exchange (NSE) S&P CNX Nifty also tanked around 70 points to close at 4,333.35 from its previous close of 4,403.20 after opening weaker at 4,393.60 and moving between 4,395.50 and 4,239.20 during the day's session.

The wholesale-price-based inflation rose 4.45 per cent in the week ended July 28 compared to a 4.36 per cent rise in the previous week, official data released today showed.

India's industrial production in June this year grew at the slowest pace in eight months as interest rates at a five-year high curbed consumer spending. Production at factories, utilities and mines rose 9.8 per cent from a year earlier, following a revised 10.9 per cent gain in May, economists said.

''Information technology (IT) stocks staged a solid comeback today following the weakening of the rupee today. The rupee was trading weaker at 40.63 against the US dollar, compared to its yesterday's close of 40.53/40.54. IT companies derive a lion's share of their revenues from US-based clients. However, banking and financial shares were under selling pressure throughout the day,'' market participants noted.

BSE data showed that though the market breadth recovered sharply post-noon, it still remained negative as 1,574 shares declined as compared to 1,127 that advanced, while 58 remained unchanged. The total turnover was Rs 5,196 crore. Among the 30-member Sensex pack, 22 slipped while 8 gained.

All the Asian indices tumbled today following a rout in global markets as credit jitters flared up after a major French bank BNP Paribas froze three funds that invested in US subprime mortgages.

Financial shares across the region were hit hard. Japan's Nikkei, Hong Kong's Hang Seng, Taiwan's Taiwan Weighted, Singapore's Straits Times, China's Shanghai Composite and South Korea's Seoul Composite are all in the red.

US stocks fell during the last trading session on deepening fears about a spreading credit crunch. The Dow Jonex Industrial Average fell 387.18 points, or 2.83 per cent, to 13,270.68. The broader Standard&Poor's 500 index fell 44.40 points, or 2.96 per cent, to 1,453.09. The Nasdaq Composite index fell 56.49 points, or 2.16 per cent, to 2,556.49.

Infosys Technologies gained 0.72 per cent to Rs 1,949.90, off the session's low of Rs 1,872 and Wipro rose 0.51 per cent to Rs 480.45, off the day's low of Rs 455. TCS settled 0.37 per cent lower to Rs 1,142.30, after touching a low of Rs 1050. India's fourth largest software exporter Satyam Computers surged 2.33 per cent to Rs 478 on 8.68 lakh shares. It was the top gainer from the Sensex pack.

India's largest listed cellular services provider Bharti Airtel plunged 3.60 per cent to Rs 838.10, on 3.82 lakh shares. It was the top loser from the Sensex pack. Bharti Airtel said it added 2.1 million cellular customers last month, taking its user base to 44.8 million.

India's largest private sector company Reliance Industries (RIL) lost 1.21 per cent to Rs 1,819.80 on 9.18 lakh shares. It moved in a band of Rs 1778 and Rs 1821.80. The Egyptian government yesterday said RIL will invest USD 10 billion in oil refining, petrochemical and plastic industries in Egypt.

The country's largest commercial vehicle maker Tata Motors rose 0.85 per cent to Rs 668.70. Tata Motors is looking to expand its auto sales in southeast Asia and plans to use Thailand as a manufacturing base.

Banking and financial shares were under selling pressure throughout the day. India's largest housing finance company Housing Finance Development Corporation (HDFC) slumped 3 per cent to Rs 1,955.

ICICI Bank slipped by 2.84 per cent to Rs 865, HDFC Bank slumped 2 per cent to Rs 1132 and SBI tanked 2.58 per cent to Rs 1,607.

ONGC, NTPC and Reliance Communications were the other losers from the Sensex pack.

Oil prices were steady at above USD 71 today, as investors watched for any further signs of distress caused by the US subprime mortgage sector crisis. US crude fell 5 cents to USD 71.54 a barrel.

London Brent crude rose 11 cents to USD 70.32.

UNI

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