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Market cowers in rate fear

Mumbai, Oct. 6: The stock markets went into a tailspin today in a slide triggered by fears of rising US interest rates and bouts of weakness on the world’s key bourses.

The sensex shed 195.77 points to end at 8528.70 compared with Wednesday’s finish of 8724.47. The losses came just days before the second-quarter results kick in. National Stock Exchange’s nifty fell 65.25 points to 2579.15.

The plunge on Dalal Street mirrored the convulsions in Tokyo, where the Nikkei suffered a 330.38-point crash while South Korea’s Kospi gave up 2 per cent. The benchmark Singapore’s Straits Times surrendered 1.6 per cent.

A fear gaining ground in the local markets is that foreign inflows will slacken due to a hardening dollar and rising US rates. The earnings season kicks off with Infosys and TCS, which will unwrap numbers on October 11.

ICICI Bank and State Bank bore the brunt of the selloff. The former saw its shares bleed after Wednesday’s announcement about a fresh public offer of shares. The bank’s stock has fallen 10 per cent over two days. BSE’s bankex closed 165.08 points lower at 4878.03.

Some in the market, however, shrugged off the downtrend. “When markets pole-vaulted to 8800, no one cared. Why are you asking now',” a fund manager affiliated to a mutual fund quipped. He felt the correction was justified, but he did not agree with the reasons.

HDFC Bank, Infosys, Reliance, ITC, Hindustan Lever, HDFC, ONGC, Bharti Tele-Ventures and L&T were also on the list of shares that took it on their chins.

Volumes on Dalal Street surged to Rs 3720.96 crore from Rs 3355.73 crore on Wednesday. Reliance was the top-traded stock with a turnover of Rs 233.20 crore. It was followed by HDFC (Rs 150.96 crore) and Bharti (Rs 148.26 crore).

Among the losers, Reliance dropped Rs 11.10 to Rs 790.05, State Bank Rs 21.90 to Rs 925.25, ONGC Rs 33.10 to Rs 1038.60, ICICI Bank Rs 25.35 to Rs 536 and ITC Rs 3.75 to Rs 127.75. HDFC Bank shed Rs 24.45 at Rs 684.25, Infosys Rs 26.90 at Rs 2615.95 and Bajaj Auto Rs 57.65 at Rs 1724.10.

The shares of Ranbaxy, among the few that bucked the trend in this session, firmed up by Rs 5.75 to Rs 518.60.

Rupee steady

After days of weakness, the rupee ended steady at 44.28 against the dollar. The sentiment was boosted by robust FII inflows and tumbling crude oil prices, but worries over current account deficit and US interest rates remain.

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