Sensex survives brief moment of scare

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By OUR SPECIAL CORRESPONDENT
  • Published 27.09.11
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Mumbai, Sept. 26: The Sensex briefly tumbled below 16,000 today — only the third time in this calendar year that it went below a key psychological level — as Eurozone debt worries continued to spook markets around the world.

In mid-morning trades, the bellwether index plunged to 15801.01 — just 36 points above this year’s nadir of 15765.53 on August 26 — before clawing back to end the day at 16051.10 with a loss of around 111 points on Friday’s close.

Stocks began the day on a weak note taking its cues from other Asian markets as investors seemed unable to shake off fears of a global slowdown that were accentuated by the poor outcomes from the Fund-Bank meetings in New York last week. The prospects of a slowdown in the world economy sent commodity markets skidding, with metals taking most of the beating.

Though the benchmark index opened marginally high at 16209.19, it could not hold on to these levels. With investors continuing to press sales, particularly in metals, refinery, consumer durables and capital goods scrips, the Sensex sank to the day’s low of 15801.01.

However, higher openings in Europe and some buying ahead of the expiry of September derivative contracts on Thursday helped the Sensex recover.

The broader NSE 50-issue Nifty also dropped 32.35 points, or 0.66 per cent, to 4835.40. It touched an intra-day low of 4758.85. Market experts say the 4700-level is extremely crucial for the Nifty and, if the index breaches this mark, it could head towards 4200.

Key indices in China, Hong Kong, Japan, Singapore, South Korea and Taiwan ended down between 1.48 per cent and 2.64 per cent. Wall Street stocks recovered from early declines but European shares pared gains of more than 2 per cent as concerns about Europe’s ability to contain the crisis persisted.

Reliance Industries was one of the losers as it slipped further by 1.5 per cent and was major contributor to the fall of the Sensex. In the past four trading sessions, it has lost nearly 11 per cent.

Heavy selling by foreign funds in the last two sessions last week — nearly Rs 2,500 crore — has also affected trading sentiment, brokers said.