Sensex wobbles temporary & on its last leg

New Delhi, Aug 17: The freefall at the Bombay Stock Exchange where the Sensex shed 216.69 points to close at 14,141.52 today, is in its last leg of corrections, said a financial service provider.

Yesterday, the 30-stock Bombay Stock Exchange (BSE) Sensex, considered a barometer of Indian economy, had recorded the second biggest fall of over 500 points, when it tumbled by 642.70 points to close at 14,358.21 points.

''Though we do not have much expertise of the US markets, the current volatility will only last for a day or two and is in its last leg of correction,'' said Motilal Oswal Financial Services Ltd Chairman and Managing Director Motilal Oswal.

The latest crash in the Sensex had been linked with the 'subprime' factor, which had made a great impact on the treasury and stock markets worldwide.

Forex experts say that foreign institutional investors (FIIs) are pulling out of the market in order to make up their losses in US treasury bills.

Mr Oswal said that the investor and market sentiments were still high and the crash at the stock market was more on lines with the global cues. ''The uncertainity at the stock market, however, is good for a certain section of people as higher volatility means higher turnover,'' Mr Oswal added.

Motilal Oswal Financial Services Ltd's (MOFSL) share lists on August 20, 2007 at the stock exchanges and a general feeling is that it could not have chosen a worse time to list, given the market conditions.

However, the Book Running Lead Manager to the Issue Citigroup Global Markets India Vice President Srinivas Sishtia said that ''a good listing does not have to worry about market conditions and we are confident that the share, once listed, will do well at the bourses''.

MOFSL's public issue of 2,982,710 equity shares of Rs five each, is a small issue since the company feels it does not need a higher amount of capital. ''Since the issue size is small, the happenings at the stock markets will have significantly less bearing,'' said Mr Sishtia.

UNI