M A I N   N E W S

Sensex closes below 15K
Beardozed
951-pt fall in global rout

Mumbai, March 17
Bears ruled the roost in stock markets today with benchmark Sensex crashing by over 950 points to close below 15K level on an onslaught of selling, triggered by global gloom, which crumbled many a heavyweight stock, including market leader Reliance Industries.

The 30-share Sensex on the Bombay Stock Exchange after tumbling to a low of 14,738.27 in intra-day, finally settled at 14,809.49, a loss of 951.03 points, or 6.03 per cent, over its previous close.

The fact that the index is closing below the 15k level for the first time since August 29, 2007 indicates the roller-coaster ride the Sensex had had since October 29 when it had crossed the 20k mark.

Meanwhile, finance minister P. Chidambaram, while speaking in Parliament, said Indian stock markets were taking cues from the US and Asian markets, even though sub-prime mortgage crisis has only moderately affected flow of funds into the country.

The broad-based S&P CNX Nifty of the National Stock Exchange also dropped 242.70 points, or 5.11 per cent, at 4,503.10 from its last close.

Worse, market participants expect more worldwide casualties on the back of resurgence of US credit market problems after the distress sale of ailing American bank Bear Stearns and emergency discount rate cut by US Federal Reserve.

The US Fed lowered the discount rate it charges on direct loans to banks by 0.25 per cent and announced a new program to lend directly to Wall Street dealers to salvage the problems. Both the developments augmented many fears concerning the stock markets worldwide. While no index shares posted gain, all indices ended in red.

The indices recorded a fall in the range of 3.2 per cent to 9.7 per cent bearing the brunt of aggressive selling. Capital goods, metal, realty, bankex and consumer durables which in the lost in the range of 6-10 per cent, bore the maximum brunt.

Among the Sensex losers, ICICI Bank topped the list with a hit of 13.76 per cent. Reliance Energy, Hindalco, HDFC and new Sensex entrant Jaipraksh Associates, which lost in the rane of 8-12 per cent, closely followed ICICI Bank.

According to dealers, buyers are deserting the markets from the last few days on expectation of further fall in share values due to unending sub-prime mortgage related problems.

Angel Broking CMD Dinesh Thakkar told PTI, "The sub-prime mess which started unfolding last year has reached bigger proportions and has been jeopardising the liquidity situation globally. The grim situation is reconfirmed by the Fed's moves which has been on a desperate interest rate cutting spree.”

All eyes are now set on the US Fed's meeting tomorrow, expecting nearly 1 per cent basis points cut in the benchmark interest rate to revive the economy which is already in recession.

Market participants felt that there might be a knee jerk reaction to that but wanted to see the effectiveness of that before making any fresh commitments.— PTI