The key benchmark indices ended mixed on a highly volatile day of
trade today. The BSE Sensex lost 106.46 points while Nifty rose
4.25 points. The market swung between positive and negative zone
throughout the day. European stocks were green amid choppy trade
amid reports the UK government may be forced to provide funding for
Royal Bank of Scotland.
The BSE Sensex and the S&P CNX Nifty both hit two-year lows in
mid-afternoon trade today, 7 October 2008. This was in contrast to
an initial surge on the bourses that was triggered by liquidity
boosting measures by Indian financial regulators announced after
trading hours on Monday, 6 October 2008. Reliance Industries
recovered sharply from 52 week low hit today. Bharat Heavy
Electricals came off from the session's lows. The market breadth
was negative
US futures were up. Nasdaq futures were up 19.25 points and Dow
Jones futures were up 33 points.
The BSE 30-share Sensex lost 106.46 points or 0.9% to 11,695.24.
The index fell 299.85 points at the day's low of 11,501.85, hit in
mid-afternoon trade, its lowest level in more than two years.
The Sensex surged 379.73 points at day's high of 12,181.43, in
early trade. The market regulator Securities & Exchange Board of
India (Sebi)'s decision to lift restriction on issue of
participatory notes and the Reserve Bank of India's surprise steep
50 basis cut in the cash reserve ratio had triggered a rebound on
the bourses in early trade after steep losses of the past two
trading sessions. Both the Sebi and RBI announcements were made
after trading hours on Monday, 6 October 2008.
The barometer index is down 8,591.75 points or 42.35% in the
calendar year 2008 so far from its close of 20,286.99 on 31
December 2007. It is 9,511.53 points or 44.85% below its all-time
high of 21,206.77 struck on 10 January 2008.
The S&P CNX Nifty was up 4.25 points or 0.12% to 3,606.60. Nifty
hit a low of 3,537 in mid-afternoon trade, its lowest level since 5
October 2006.
BSE clocked a turnover of Rs 4,728 crore today as compared to a
turnover of Rs 3,992.08 crore on 6 October 2008.
Nifty October 2008 futures were at 3640.10, at a premium of 33.50
points as compared to spot closing of 3606.60. NSE's futures &
options (F&O) segment turnover was Rs 59,767.70 crore, which was
higher than Rs 46,853.23 crore on Monday, 6 October 2008.
The BSE Mid-Cap index was down 2% at 4,257.16 and the BSE Small-Cap
index was down 2.17% at 4,976.39.
BSE Capital Goods index (down 3.96% to 9,118.52), BSE IT index
(down 3.04% to 2,840.30), BSE Bankex (down 2.15% to 6,039.25), BSE
Realty index (down 1.94% to 2,941.72), BSE FMCG index (down 1.77%
to 2,053.68), BSE HealthCare index (down 1.74% to 3,427.52), BSE
Metal index (down 1.34% to 7,534.03), BSE Teck index (down 1.22% to
2,352.76), underperformed the Sensex.
BSE Oil & Gas index (up 1.3% to 8,012.18), BSE PSU index (up 0.84%
to 5,980.92), BSE Power index (up 0.38% to 2,074.26), BSE Auto
index (down 0.41% to 3,511.96), BSE Consumer Durables index (down
0.67% to 2,552.32), outperformed the Sensex.
The market breadth was weak on BSE with 787 shares advancing as
compared to 1,822 that declined. 74 shares remained unchanged.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries rose 2.04% to Rs 1,675.40. The
stock recovered from a 52 week low of 1615.25 hit today.
Capital goods stocks declined. Larsen & Toubro (down 6.94% to Rs
1,008.10), and Suzlon Energy (down 1.97% to Rs 124.60) edged lower.
However India's largest electric equipment maker by sales Bharat
Heavy Electricals surged 3.26% to Rs 1,496.70. The stock recovered
from session's low of Rs 1,440.10.
Bank shares pared gains after firm opening. India's largest private
sector bank by net profit ICICI Bank fell 1.07% to Rs 485.20. The
stock came off from the session's high of Rs 521.70. India's second
largest private sector bank by net profit HDFC Bank declined 6.17%
to Rs 1,127.70. The stock came off from the session's high of Rs
1,245. India's largest commercial bank State Bank of India fell
1.81% to Rs 1,408. The stock came off from the session's high of Rs
1,503.
The Reserve Bank of India (RBI), after trading hours on Monday, 6
October 2008, announced a 50 basis points cut in the cash reserve
ratio (CRR) to 8.5%, with effective from 11 October 2008. RBI said
the CRR cut is an ad hoc, temporary measure and it will be reviewed
on a continuous basis in the light of the evolving liquidity
conditions. RBI said it will give priority to liquidity management
over the period ahead given the turbulence in international
financial markets. RBI also said the overriding priority for
monetary policy is to eschew any further intensification of
inflationary pressures and to firmly anchor inflation expectations.
Tata Consultancy Services (down 7.02% to Rs 575.08), Sterlite
Industries (down 6.35% to Rs 314.05), Satyam Computer Services
(down 5.18% to Rs 279.09), edged lower from the Sensex pack.
NTPC (up 4.83% to Rs 176.85), Ranbaxy Laboratories (up 5.54% to Rs
260.10), and Bharti Airtel (up 3.6% to Rs 755), edged higher from
the Sensex pack.
India's largest oil exploration firm by revenue Oil and Natural Gas
Corporation rose 1.25% to Rs 992.35. The stock came off from the
session's high of Rs 1,040. The company will shortly tie up with
Uranium Corporation of India for exploring and mining the fissile
material, suggest reports.
Reliance Natural Resources clocked the highest volume of 1.41 crore
shares on BSE. Idea Cellular (1.18 crore shares), Chambal
Fertilisers and Chemicals (1.02 crore shares), Reliance Petroleum
(82.07 lakh shares) and IFCI (77.66 lakh shares) were the other
volume toppers in that order.
Reliance Capital clocked the highest turnover of Rs 389.90 crore on
BSE. Reliance Industries (Rs 344.76 crore), Larsen & Toubro (Rs
204.33 crore), State Bank of India (Rs 178.05 crore) and ICICI Bank
(Rs 176.86 crore) were the other turnover toppers in that order.
In Europe, UK's FTSE 100, France's CAC 40 and Germany's DAX were up
between 0.75% to 1.95%. As per reports the UK government may be
forced to provide funding for Royal Bank of Scotland. On Monday,
credit ratings agency S&P cut its rating on RBS, citing earnings
and further writedown risks.
European Union finance ministers gathered in Luxembourg on Tuesday,
7 October 2008, to discuss ways of protecting savers' deposits and
counter the market turmoil that saw the region's stock markets
suffer record losses on Monday, 6 October 2008. Australia's central
bank cut its benchmark cash rate by 100 basis points to 6%,
stunning investors with its biggest interest rate cut in 16 years.
Asian stocks outside Japan rose for the first time in four days on
Tuesday, 7 October 2008, after a surprisingly large interest rate
cut by Australia's central bank raised hopes that other
policymakers would follow suit. Taiwan stocks ended up 0.34%,
recouping sharp losses earlier in the day and rebounding from a
more than four-year closing low the previous session as government
funds helped bolster market heavyweights such as TSMC.
South Korea's KOSPI rebounded from a 21-month low and rose 0.54%.
The country's regulator said it was considering steps to reduce
volatility in the equity market, helping to stem some of the day's
losses.
China's stock market fell but ended well off its lows as hopes for
government support helped banks and property shares rebound from a
sharp early slide. The Shanghai Composite Index, which had dropped
as much as 4.64% in the morning, closed down 0.73% at 2,157.839
points. Singapore shares reversed early losses go gain about 2%.
Japan's Nikkei was down 3.03% after The Bank of Japan kept interest
rates unchanged at 0.5% on Tuesday, 7 October 2008, and maintained
its assessment on the economy, which it said was sluggish.
Back home, the Sebi decision on lifting of restriction on P-notes
comes at a time when foreign institutional investors (FIIs) have
been pulling out their investments from India and other emerging
markets to shore up resources to beat the global liquidity crunch.
In India, FIIs sold shares worth a net Rs 8278.10 crore last month.
The outflow has reached Rs 38037.30 crore in calendar year 2008
(till 3 October 2008).
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