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Sensex's biggest-ever fall: 826 points

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Last updated on: May 18, 2006 17:39 IST

An Indian stockbroker keeps watch on his monitor as Indian stock market plunged by 826 points to 11,391 on 18 May, 2006. Photograph: Sebastian D'Souza/AFP/Getty ImagesThe markets closed with sharp correction taking cues from Dow, Asian and other emerging markets. The Sensex closed at 11,391 down 826 points, which is the highest ever absolute fall for the Sensex. The NSE Nifty closed with a loss of 246 points at 3,389.

According to experts, one of the reasons for such a fall is that the US CPI numbers came on Wednesday and were worse than expectations, which could further initiate a hike in Fed rates.

On the domestic front, triggering of margin calls caused spiraling, which led to across the board selling.

Although the fall has been very steep on Thursday, but the fall in the Indian market in the last one week has been lesser as compared with a fall in the other emerging markets like Brazil, Russia and Mexico.

The BSE midcap index was down 6.4% at 5,891.12 and the BSE Smallcap was down 6.44% at 7,617.20.

The overall market breadth was negative, about 262 shares have advanced, 2216 shares declined, and 29 shares are unchanged.

According to Adrian Mowat, Asian Regional Strategist at JPMorgan believes that underline fundamentals are still strong in emerging markets. He adds that India should correct by 4-5% and that markets will look attractive at 11,000 levels. He also says that all markets will focus on cues from US Fed.

All the Sensex and Nifty stocks closed in the negative terrain. All the BSE indices closed in red.

Markets on Thursday:

  • Historic day for the markets; biggest ever single-day fall in point terms
  • Indices fall more than the infamous May 17, 2004 crash in point terms
  • Markets spooked by volatile commodity prices, uncertainty over tax on FIIs
  • Triggering of margin calls causes spiraling, across the board selling
  • Sensex saw biggest ever intra-day fall of 887 points; Nifty of 269 points
  • Sensex ends down 826 points at 11,391; Nifty down 246 points at 3389, both down almost 7%
  • All Sensex, Nifty stocks close in the red; metal stocks worst hit
  • BSE Metals index down over 11% to 9199 points; slides almost 1200 points
  • Lower than expected results from Tata Steel adds to negativity; stock crashes almost 11%
  • BSE Auto, Capital Goods, & Oil & Gas indices shed around 7% each
  • All major BSE sector indices close down at least 5% or more
  • Market breadth sharply negative; only 27 Advances on NSE against 891 Declines
  • Total market turnover higher at Rs 57,523.49 cr vs Rs 44,342.48 on Wednesday

The NSE cash turnover was Rs 10565.45 crore. The NSE F&O turnover stood at Rs 44907.2 crore. The BSE cash turnover stood at Rs 4844.82 crore.

The metal index was down 11.4% at 9,199.51. The major losers were Sterlite Ind, Guj NRE Coke, JindalStainless, Hindalco, NALCO, and SAIL.

The consumer durables index was down 8.2% at 3,267.52. Stocks including Whirlpool, Titan Industries, Blue Star and Su-Raj Diamonds closed lower.

The auto index was down 7.24% at 5,282.71. Among the major losers were stocks like Hind Motors, Escorts, Ashok Leyland, Maruti Udyog, Tata Motors, Cummins and M&M.

The capital goods index was down 7.2% at 8,135.30. Stocks like Greaves Cotton, HEG, Siemens, Crompton Greave, Carborundum, BHEL and Aban LoydChiles were among the top losers.

The BSE oil & gas index was down 7% at 5,557.86. The major losers were MRPL, Petronet LNG, Reliance, ONGC and GAIL.

The FMCG index was down 6.4% at 2,125.74. Stocks including Shaw Wallace, Dabur India, Colgate, Tata Tea and ITC were among the major losers.

The bankex was down 6.17% at 5,243.06. Stocks including Canara Bank, Bank of India, SBI, IOB, Kotak Mahindra and Bank of Baroda closed in deep red.

The health care index was down 6% at 3,702.98 and the BSE IT index was down 5.3% at 3,860.73.

Experts say that any fall in the market will make valuations cheaper and investment buying will take place.


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