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Sensex Plummets by 626 Points

Indian stock markets crashed spectacularly on a slew of local and global cues

Indian stock markets reacted in a very sharp and negative manner to the global cues that started from the US and circled the globe, sending all major stock market indices into a tailspin, especially in China and India – for the latter some contributory factors were local in nature.

The poor pace of the economic growth in developed countries added to the fear of scanty rainfall across India during the monsoon, plus Nomura Securities reducing its forecast for Indian economic growth to 5.5 per cent in 2009/10 was more than enough to send traders into a tizzy.

Sensex fell as much as 626.71 points, a fall of 4.07 per cent, to 14,784.92 points -- it also loosened its grip over the 15,000-point mark. The last time Sensex had fallen by this big a margin was when it lost 5.8 per cent on July 6. At this level, this is the lowest close for Sensex since July 17.

The extent of the damage was felt across all scrips listed on the Sensex as none could end in the green.

On the National Stock Exchange, Nifty fell by as much as 4.2 per cent to 4,387.90 per cent.

The major stocks that were hit the most included Reliance Industries, which shed 4.7 per cent, ONGC lost 4.6 per cent, Hindalco lost 7.4 per cent, Sterlite lost 6.7 per cent, and DLF Ltd lost 7.8 per cent.

Among some immediate policy-linked falls were sugar stocks, which reacted negatively to the government's not-yet-stated intent, but talks are on thereof, to hike the levy sugar rates that it gets from the millers at below-market rates -- the hike may be from 10 per cent to 20 per cent that may translate into a jump from the current Rs 13 to anywhere around Rs 20.

It was a signal for a sell-off in Shree Renuka Sugar stock, which ended the day down by over 3 per cent. Bajaj Hindusthan lost 2.1 per cent, Dhampur Sugar and Balrampur Chini by 3 per cent.

Also, power stocks got a shock on reports that the government is looking to put a limit on the sale rate on electricity in the open market,

While Jindal Steel & Power lost almost 7 per cent, Reliance Infra was down by 6 per cent, Reliance Power by 4 per cent, GVK Power, Voltamp Transformers and CESC lost over 4 per cent each, and Tata Power by 2 per cent.

Navneet Publications, announced an equity shares bonus today, but that came in too late to save the scrip from falling 2 per cent on the BSE and over 3 per cent on the NSE. The company said that net profits for the year ended FY09 was Rs 589 million as against net profits during FY08 which stood at Rs 537 million and on consolidated basis Rs 564 million in FY09 as against Rs 542 million in FY08.

Over on China’s bourses, the news was rather grim too. The Shanghai Composite fell by as much as 3.7 per cent, while the story repeated in the nearby regions’ markets: Hang Seng was down by 2.64 per cent, Japan’s Nikkei fell by 2.7 per cent, Singapore’s Straits Times fell by 1.17 per cent.

Top 5 Gainers
Company   Last Traded Price (Rs)   Last Closing Price (Rs)   Change w.r.t. Last Closing Price (%)
Marico 88.05 85.25 3.28
Bajaj Holdings & Investment 454.10 444.40 2.18
Jain Irrigation Systems 692.85 684.15 1.27
Fortis Healthcare 101.95 100.85 1.09
Mahindra & Mahindra Fin. Serv. 223.95 221.85 0.95
Top 5 Losers
HDIL 268.20 295.35 -9.19
IFCI 48.35 53.10 -8.95
United Phosphorus 159.55 174.20 -8.41
Lanco Infratech 394.25 428.70 -8.04
Videocon Industries 192.60 209.05 -7.87