The Telegraph
Since 1st March, 1999
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Stocks enter cooling tower

Mumbai, Aug. 8: Markets snapped a long winning streak today as concerns over oil prices and global stock wobbles overshadowed the surging foreign capital flows that have propelled shares to new orbits over the past week.

The sensex closed at 7606.17 in a 148-point plunge that was the steepest since a late April slide, as key stocks were dumped by investors skittish about the oil boil.

Dealers said foreign investors made moderate purchases today, reining in their enthusiasm that has seen them shovel a staggering Rs 30,000 crore into equity this year.

Part of the money they pumped in could be the excess cash set aside for the recent IDFC issue.

Today’s slide halted the bandwagon that has driven up the sensex by a quick-fire 493 points, or 6.75 per cent, in the last nine trading sessions, between July 22 and August 4.

The flare-up in crude and indications from the government about another fuel price hike combined with reports that Sebi was keeping a watch on some funds that have invested heavily in the markets in the recent past.

Some analysts called the drop a “long overdue correction” but they differed on whether it should have been as steep.

Infotech shares like Infosys and Satyam came under fire, as did Tata Motors, which reported lower July car sales. Bank stocks bore the brunt of selling. Such was the intensity that the BSE bankex gave up 155.16 points, or 3.33 per cent, to end at 4502.79 against 4657.95 on Friday.

Reliance Industries, State Bank of India, Hindustan Lever and ITC were the other big losers on a day the Dalal Street volume shrunk to Rs 3378.47 crore from Rs 3936.23 crore.

Reliance Industries dipped Rs 14.25 to Rs 711.50, State Bank by Rs 26.10 to Rs 778.90, Tata Motor Rs 24.70 to Rs 478.20, ICICI Bank Rs 21.65 to Rs 478.45, ITC Rs 13.85 to Rs 1724.35, Reliance Energy Rs 17.90 to Rs 629.25, HLL Rs 3.60 to Rs 161.55 and Infosys Tech Rs 20.25 to Rs 2270.55.

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