SENSEX 14662.61 -238.15
NIFTY 4400.25 -68.45
Indian equities continued their slide on Wednesday at a faster rate, as bad news poured in from world markets. European stocks weakened after the European Commission expressed doubts over the region’s economic growth and a possibility of further doom in the banking sector. Leading US investment bank Lehman Brothers Holdings reported a third quarter net loss of $3.9 billion — the biggest in its 158-year history.
It now plans to sell a majority stake in its asset-management unit, spin off commercial real-estate holdings and cut dividend in an effort to shore up capital. Back home, the rupee hit a 2-year low, breaching the psychological 45-mark to the dollar in the process, spelling further bad news for the economy as a whole. Metal and oil & gas stocks were the worst performers, as the 30-share Sensex fell 238.15 points on Wednesday to close at 14,662.61.
All the BSE sectoral indices ended in the negative with the metal index plunging over 5%. Analysts opine that the commodity cycle is in a downturn phase and consequently the companies are likely to face a pressure on earnings. The S&P CNX Nifty slipped 68.45 points to close at 4400.25. The BSE mid and small-cap lost over 60 points each to close at 5,708.93 and 6,903.42, respectively. The slide in the rupee, however, failed to energise IT shares, with the BSE IT index closing marginally below its previous close.
Dealers say worsening financial conditions in the US would impact the revenue of IT companies, hurting their growth. “The balance of payments dynamics and US dollar strength will cause the rupee to weaken. We expect the rupee to weaken against the dollar to 46-47 by December 2008, but it will likely pull back to 45 by March 2009,” said Macquarie Research in a note to its clients. “Be prepared for more aggressive intervention by RBI in the forex market. Also, the government is likely to ease restrictions on capital inflows in order to check the pace of the rupee’s depreciation,” the noted added. On the global front, OPEC in Vienna decided to reduce supplies by 500,000 barrels a day. Consequently, crude oil for October rose as much as $1.56 to $104.82 a barrel on the New York Mercantile Exchange (NYMEX). The last trading price at the exchange was $101.67 a barrel on Wednesday. “Domestic market has factored in the receding oil prices. If they fall below $90 a barrel, there could be a rally in the indices, but it won’t be a sustained one. In the near term, the range would continue to be between 4,400 and 4,700,” said India Infoline head-research Amar Ambani. Market breadth continued to be weak with retreating stocks outnumbering gainers nearly two for one. Total turnover in markets was close to Rs 70,000 crore, a rise of Rs 10,000 crore over the previous close. However, the improvement in volumes is of little cheer as foreign funds continue to dump stocks. As per provisional data, they net sold Rs 1,037 crore shares on Wednesday. Domestic institutions cushioned the sales to some extent, with net purchases of Rs 492 crore. Markets across the Asia-Pacific ended on a mixed note. China’s Shanghai Composite index advanced 0.2% and South Korea’s KOSPI Composite index gained 0.7%, while Japan’s Nikkei 225 index ended down 0.4% and Hong Kong’s Hang Seng index lost 2.4%.
Sensex loses nearly 225 pts; Nifty slips by 63 pts @ 14:22 hrs
Rupee breaches crucial 45-level
L&T gets $160 m order from Petrobras
Era Infra bags Rs 130 cr order from AAI
Usher Agro signs pact with Japanese company
OPEC resorts to output cut; Oil jumps $1
Core infrastructure sector growth slips to 3.7%
SEL Manufacturing to invest Rs 500 cr in textile park
Educomp buys 50% in EuroKids for Rs 39 cr
Vedanta in $9.8 b plan; trifurcates biz
Wary market weighed down by Lehman, inflation, IIP
Short build up in Nifty; call writing at 4400-4500
Tata Power to add 10,000 MW in next five years
L&T bags Rs 723-cr order from Petrobras
Omaxe launches Rs 800-cr township
Equities end lower ahead of inflation; IIP data
Source:Sift, ET