Sunday, October 12, 2008

Sensex down nearly by 2000 points - biggest ever weekly fall

Mumbai, (UNI) - The key benchmark Sensex of the Bombay Stock Exchange (BSE) slumped by 1,998.47 points, or 15.95 per cent, to 10,527.85 points, registering the biggest ever weekly low, in the week ended yesterday amid wild rumours about the global recession led to panic sales across the globe.

Similarly, the broader 50-share Nifty of the National Stock Exchange (NSE) also recorded the largest-ever point-wise fall of 538.35 points, or 14.10 per cent, to end the week at 3,279.95 from its last finish.

A leading stock broker said ''A global sell-off triggered the biggest weekly fall for Indian indices since 1990. Fears that the deepening credit crisis will push the global economy into recession, rattled stock markets across the globe. World markets were continuously pounded on mounting fears that the escalating credit crisis will drag the global economy into recession.'' Back home, weak industrial output data added to the gloom on October 10. The Reserve Bank of India yesterday announced a 100 basis point cut in the cash reserve ratio (CRR), the proportion of deposits that banks must keep with the central bank, in addition to a 50 basis point reduction announced on October six, to boost liquidity.

The RBI's steep cut in cash reserve ratio, twice in the week, failed to soothe investors' nerves. Investors looked helpless and resorted to unloading of their holdings after the coordinated efforts by the central banks from major countries to shore up liquidity failed to have desired impact on the market sentiment.