Sensex plunges 766.18 pts, Nifty tumbles during week

Mumbai, Feb 23: The benchmark Sensex plunged by 766.18 points or 4.23 per cent to 17,349.07 on the Bombay Stock Exchange (BSE), while the broader based Nifty tumbled by 192.15 points or 3.62 per cent at 5,110.75 amid adverse global cues in the week ended February 22.

Sensex ended three sessions with a negative gap and two sessions in green tracking Asian markets and reacting to the US economic behaviour, which had created extreme volatile conditions during the last few months, dealers said adding volatility in global markets and rising crude oil prices hampered the sentiments in most of the Asian markets during the week.

Most of the stocks, including banking stocks, plunged heavily, while IT stocks rose as investors turned in after the rupee fell to a five-month low at 40.11 against the dollar. IT stocks also gained momentum on reports that government might onsider fresh tax sops to the export sector, which has been hit by rupee appreciation.

However, BSE small-and mid-cap stocks escaped the sharp fall, as there have been comparatively less speculative positions in these counters. Crude oil prices went up to a record high of USD 100.10 a barrel on the New York Mercantile Exchange February 19, which strengthened the possiblity of price rising in other commodities, resulting in higher inflation and viz-viz slowdown in global growth.

Back home, Inflation based on the wholesale price index (WPI) hit a new six month high at 4.35 per cent in the week from 4.07 in the previous week. Meanwhile, frontline stocks such as Reliance Industries (RIL) slipped 6.21 pc to Rs 2429.80 during the week. Bharat Heavy Electricals dropped 8.95pc to Rs 2058.85 and Larsen&Toubro slipped 2.91 pc to Rs 3434.However, Reliance Power climbed 8.36 pc to Rs 416.85.

The board of the company will meet on Sunday to consider issue of bonus shares. The bonus shares will be issued to non-promoter shareholders to compensate the losses suffered by them when the company was listed last week. The stock has been consistently trading at a discount to IPO price of Rs 450, since its listing on February 11.

Centurion Bank of Punjab gained 12.69 pc to Rs 56.40 amid the buzz of its merger with HDFC bank in the week. As per reports, the Boards of HDFC Bank and CBoP today, in principle, approved the merger proposal and will hold a joint meeting on Monday to discuss the share-swap deal and other regulatory norms.

Further, the marketmen expect positive move in the bourses in the coming sessions as the Union Budget next week is expected to be a populist as well as market friendly budget.

Apart from the budget, another trigger for the market is prospects of further softening of interest rates by the US Federal Reserve, marketmen
added.

UNI