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Journalism of Courage
Bulls ran for cover on Dalal Street after the government disappointed them on the telecom FDI front and fears over foreign fund sales gripped the market. Stocks markets witnessed a selling avalanche in the last 30 minutes of trading on Thursday, sending the benchmark Sensex plunging by 130 points.
According to market sources, a host of reasons—including the government move to defer 100 per cent FDI in telecom, selling by foreign funds and the Sebi move asking sub-brokers to stop issuing contract notes to clients—dampened the sentiment. Marketmen were disappointed by the net outflow of FII funds in the last two days. Further, the government move to defer higher FDI in telecom also disappointed market players. “There were big expectations from the government on Thursday. But the decision on telecom disappointed market players,” said stock dealer R.A. Podar.
They were also worried about early signs that the foreign fund investments which have driven the market to new highs might also be near a peak. Traders said profit-taking was sparked by data showing overseas investors sold local shares for a net $9.1 million on Tuesday — the first day of net sales by overseas investors this year.
In an extremely volatile trading session, the 30-share BSE Sensex plunged 130.20 points, or 2.1%, to settle at 6,063. The S&P CNX Nifty index also shed 37.70 points, or 1.9%, to close at 1,944.45.
