Feb 19, 2009

Sell off continues on Dalal Street

17 Feb 2009 | 18:26
Sell off continues on Dalal Street

A broad-based sell-off spilled over to the second session in a row after interim budget turned out to be a non-event. Weakness in global markets also dampened sentiments. The BSE 30-share Sensex fell 270 points, or 2.9% to close at 9,035. In the last two trading session, the Sensex has lost 6.2%. The S&P CNX Nifty dropped 78 points, or 2.7%, to 2,771.

The broadmarkets too fell, but to a smaller extent. The BSE Midcap was down 2.3% while the BSE Smallcap was down 2.4%. The advance decline ratio on the BSE was 1:2.5. The turnover on the NSE was Rs. 7,142 cr versus Rs. 8,019 cr, down 11%.

Sectorally, it was a sea of red. The BSE Bankex, Consumer Durables and Realty indices lost more than 4% each. Most of the Sensex stocks closed in the red. India's largest cigarette maker by sales ITC was the only stock in the Sensex that bucked weak market trend.

Tata Steel slumped 6.7%. An official from S&P was recently quoted by media as saying that Tata Steel's liquidity is weak on a consolidated basis. The report also said the firm could face significant refinancing risk considering the near term pressure on Tata Steel UK's financial agreements which involves about more than 3 billion pounds of debt.

ICICI Bank lost 5.7%. Banking shares tumbled sharply after bond yields rose to their highest in more than two months on Tuesday afternoon on concerns over the government's additional borrowing and lack of clarity on the central bank's open market operations.

On the bright side, the markets closed above the 9,000 psychological mark. The index had fallen below the crucial 9,000 level in late trade but soon recovered. However, a sustained move below 9,000 could result in a fresh bout of weakness.

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