Sensex tumbles by another 164 points

The ‘feel good’ euphoria has now turned into a panic. The Sensex erased all its gains for the year 2004 as a selling avalanche — led by foreign funds and local operators — sent stocks crashing like a pack of cards in another highly volatile trading on Wednesday. After moving in an intra-day range of 234 points, the fancied index ended with a massive loss of 163.92 points, or 2.77 per cent, at 5,758.19.

The Sensex had lost 142 points on Tuesday. ‘‘The investors are becoming cautious just before the presentation of interim Budget and elections. The next few trading sessions are going to be very volatile,’’ says Gaurav Shah, a BSE broker.

Investors wealth plummeted by a whopping Rs 94,000 crore to Rs 11,67,017 crore in the last two days. This may be a small fall when compared to over 100 per cent gain in Sensex and over Rs 6,00,000 crore rise in market cap in the last eight months.

Fingers are once again pointing to the foreign funds which pumped in over $ 7.5 billion in 2003 and led the bull rally so far. “FIIs have been selling in the last a few days. Their investment has come down in 2004,” says BSE dealer Venkatesh Aiyar.