The Hindu Business Line : Sensex crashes tracking weak global markets

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Mumbai/Kolkata March 5 Indian stocks plunged across the board on Monday, taking cue from the rout in global, particularly Asian, markets.

The benchmark BSE Sensex lost 471.09 points or 3.66 per cent from Friday's close, to end the day at 12,415.04. The 50-share NSE Nifty declined by 4.03 per cent to close at 3,576.50.

The Indian markets initially caught the cold with reports of global markets weakening - starting with China's benchmark index falling last Tuesday, Wall Street reporting its worst week in four years, after which came the general decline across Asian markets.

After that the fever rose as overseas funds continued to sell, and as post-Budget discontent with respect to the Indian corporate sector continued to show, according to brokers.

"Then there were margin calls. All in all, there was nothing positive through the day and the negatives kept piling up," said a broker.

The Sensex opened at 12,415.04, only to immediately begin its decline. It touched a low of 12,344.44 before making a weak recovery.

All the indices ended weaker. The BSE Midcap slid by 4.97 per cent and the BSE Smallcap by 5.64 per cent. All the sectoral indices ended weaker too, led by the BSE CG (5.51 per cent) and the BSE Auto (5.18 per cent).

Twenty-eight of the 30 Sensex stocks declined.

In all, 2,363 (90.5 per cent) of the total number of traded stocks fell on the BSE, while only 220 advanced.

The top losers were Ranbaxy Laboratories (7.56 per cent), Maruti Udyog (6.56 per cent) and Dr Reddy's (6.35 per cent).

The fall in the IT sector was led by Wipro (6.29 per cent) and Infosys (4.59 per cent). TCS was lower by 3.83 per cent.

The other losers were Tata Steel (5.17 per cent), SBI (4.57 per cent) and L&T (5.52 per cent). ICICI Bank lost 2.97 per cent.

But institutional investors have hedged themselves, said a leading broker.

"Futures have traded at discount of 20-30 points. Those who wanted to unload their positions in the cash markets started the day selling Nifty futures.

"Then, as they sold in the spot markets, they kept covering themselves in the futures market."

Because they sold first, the loss would not have hit them - the discounts would not have been so large otherwise.

But the retail investors, who have no knowledge of this, panicked.

Rupee slump

The volatility in the stock market extended to the rupee, which slumped by over 30 paise against the dollar.

The currency opened at 44.33/35, touched an intra-day low of 44.70/71, before ending the day at 44.63/64, down from Friday's close of 44.29/30.

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