Global slide triggers 542 point plunge in Sensex

Selling Spree: Rupee sees lowest close in over three weeks

Stock markets across the globe reeled under a selling avalanche, sending benchmark indices plummeting today. Taking cue from the steep declines in other Asian markets, Dalal Street too witnessed a bloodbath with the Bombay Stock Exchange’s (BSE) benchmark 30-share Sensitive Index (Sensex) plunging 541.74 points (3.4 per cent) to 15,234.57, its biggest rout in a single trading session in nearly four months. As a result, total market capitalisation fell by Rs 1,57,500 crore to Rs 44.44 lakh crore in a day.

The rupee fell to its lowest close in over three weeks today, losing ground as the global equities sell-off saw foreign investors pare back their holdings of emerging market assets. The rupee ended at 40.51/53 per dollar, its weakest finish since July 3, from a previous close of 40.3400/3450. It had hit a nine-year high of 40.20 per dollar on Tuesday. “The fact that the rupee did not fall further, given how much stocks fell, is what is remarkable — it shows that there’s still a lot of interest in the rupee,” said the chief dealer with a corporate.

The S&P CNX Nifty plunged 174.20 points (3.78 per cent) to 4,445.20. The Nifty August 2007 futures was at 4,392.85, a sharp discount of 52.35 points compared to spot closing. “India is going to react to the ongoing weakness in the global markets and extent of the fall depends on the intensity of the correction in other major global indices,” said an analyst with Ashika Stock Broking.

The trigger for the fall in Dalal Street came from other Asian markets which settled with sharp losses. Japanese stocks led Asian markets lower in a broad-based retreat as export stocks were hit hard on concerns over the outlook for the US economy. The Nikkei tumbled 2.36 per cent, Hang Seng 2.76 per cent, Taiwan Weighted 4.22 per cent, Singapore’s Straits Times 2.43 per cent and South Korea’s Seoul Composite 4.09 per cent. The Shanghai Composite was down 0.03 per cent.

Even as the markets declined, the turnover vaulted. The total turnover on the BSE amounted to Rs 6,593 crore against Rs 5,758 crore on Thursday. The NSE F&O turnover was Rs 65,777.96 crore. The NSE F&O turnover was a record Rs 79, 995.85 crore on Thursday, on the day of expiry of July 2007 derivative contracts.

Among the Sensex pack, 27 shares slumped, while three stood tall in the bloodbath. India’s largest cigarette manufacturer ITC jumped 2.67 per cent after its net profit rose 20 per cent in the first quarter of 2007, exceeding market expectations. Tata Tea rose 0.64 per cent to Rs 759.60 after it said it has become the number one domestic packet tea company in terms of volume. Ranbaxy Laboratories, India’s largest pharma firm by sales, was up marginally by 0.16 per cent.