The key benchmark indices provisionally ended lower in choppy late
trading sessions. Sensex provisionally ended down 270.95 points or
2.51%. The market made a strong rebound from a sharp intraday fall
as European stocks cut initial steep losses. Banking stocks bounced
back on softening inflation.
Index stocks, Sterlite Industries, Reliance communications, HDFC,
Bharti Airtel, and Tata Steel recovered sharply from their lows.
European markets were down between 3.14% to 3.91%, after having
fallen as much as 5.6% earlier on global recession worries. Trading
in US index futures suggested the Dow would fall 14 points at the
opening bell.
As per the provisional figures, the BSE 30-share Sensex lost 270.95
points or 2.51% to 10,538.17. The index declined 791.32 points at
the day's low of 10,017.80 hit in early afternoon trade, its lowest
level since 24 July 2006. The Sensex fell 22 points at day's high
of 11,787.20 in mid-afternoon trade.
The S&P CNX Nifty ended down 83.10 points or 2.49% to 3,255.30 as
per the provisional figures. It hit a low of 3,099.90, its lowest
level since 26 July 2006.
BSE clocked a turnover of Rs 4540 crore today as compared to a
turnover of Rs 3,581.21 crore on 15 October 2008.
The BSE Mid-Cap index was down 1.77% at 3,654.81 and The BSE
Small-Cap index was down 2.54% at 4,282.08. Both the indices
outperformed the Sensex.
The market breadth was weak. On BSE, 827 shares advanced as
compared to 1,734 that declined. 60 shares remained unchanged.
India's largest private sector company by market capitalization and
oil refiner Reliance Industries fell 8.7% to Rs 1,387. The stock
came off from a 52-week low of Rs 1,327. The stock declined for the
second day in a row today on fears the company may report fall in
its gross refining margins in Q2 September 2008 over Q2 September
2007 largely due to sluggish demand for petroleum products in key
Western markets. The stock had slumped 6.2% yesterday, 15 October
2008.
Reliance Communications (up 7.59% to Rs 253.70), Jaiprakash
Associates (up 5.91% to Rs 77), DLF (up 5.16% to Rs 315.70),
Sterlite Industries (up 1.32% to Rs 296) and Reliance
Infrastructure (up 0.95% to Rs 561) were the major gainers from the
Sensex pack.
Among the major losers from the Sensex pack were Hindalco
Industries (down 13.35% to Rs 68.80), Tata Motors (down 11.29% to
Rs 250.20), Mahindra & Mahindra (down 6.71% to Rs 451.50), Larsen &
Toubro (down 7.55% to Rs 825.75).
Softening of inflation triggered recovery in bank stocks from an
initial slump. India's largest private sector bank by net profit
ICICI Bank rose 0.19% to Rs 415 off the session's low of Rs 376.25.
ICICI Bank ADR slumped 14.19% in US on 15 October 2008.
India's largest private sector bank by net profit HDFC Bank dipped
4.15% to Rs 1,087.35, off the day's low of Rs 1,041. HDFC Bank ADR
fell 13.21% in US on 15 October 2008. The bank will announce Q2
September 2008 result today, 16 October 2008. State Bank of India,
India's biggest commercial bank, was up 3.13% to Rs 1,543.90 off
day's low of Rs 1,420.55.
India's largest home loan lender by sales HDFC rose 6.27% to Rs
1,820, off the day's low of Rs 1,600.
IndusInd Bank surged 3.91%, as net profit jumped 50.67% to Rs 33.66
crore in Q2 September 2008 over Q2 September 2007.
Lower inflation may trigger cut in interest rate by the Reserve
Bank of India (RBI) which may spur lending. Inflation based on the
whole price index rose 11.44% in year through 4 October 2008, lower
than previous week's 11.8% rise, data released by the government
today, 16 October 2008, showed.
Indai's largest steel maker by sales Tata Steel fell 1.28% bouncing
back from 52-week low after its UK unit signed pact for procuring
iron ore, a key raw material.
The market regulator Securities & Exchange Board of India (Sebi)
has tightened margins in the derivatives segment to ward defaults
and curb volatility. The exposure margin for gross open positions
in single stock futures and gross open positions in stock options
will now be higher of 10% or 1.5 times the standard deviation in
the notional value of the positions.
Reserve Bank of India (RBI) on Wednesday, 15 October 2008, cut the
cash reserve ratio (CRR) by a 100 basis points to 6.5% The CRR cut
would release Rs 40000 crore into the banking system. The CRR cut
takes effect from the current two-weekly reporting period for
banks, which began on 11 October 2008.
With a view to ease the liquidity in the banking system, the
central bank has also allowed banks to borrow an additional 0.5% of
their net demand and time liabilities using their SLR (statutory
liquidity ratio) holdings as collateral under the LAF (liquidity
adjustment facility) to meet liquidity requirements of mutual
funds. SLR is the amount of deposits banks have to invest in
government debt. The RBI will also release the first installment of
Rs 25,000 crore under the agricultural debt waiver and debt relief
scheme to banks immediately, at the government's behest.
A warning of tough times ahead by Federal Reserve Chairman Ben
Bernanke sent Asian markets sharply lower, as investors brace for
looming recession. Key benchmark indices in China, Hong Kong,
Japan, South Korea, Singapore and Taiwan were down by between 3.25%
to 11.41%.
Shrugging off recent optimism about massive government efforts to
prop up the global financial system Wall Street , yesterday, 15
October 2008, suffered its worst one-day percentage decline since
the stock market crash of 1987.
Crude oil for November delivery fell as much as $1.58, or 2.1%, to
$72.96 a barrel on the New York Mercantile Exchange on 15 October
2008, the lowest since 30 August, 2007.
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