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London Blasts Rock Markets

The Sensex closes flat at 7,212 after over 142 points fall on Thursday. The Nifty loses 0.71 per cent over the week to close at 2,196 points

London blasts rocked the Indian equity markets in the week ended July 8, 2005. An over 142 points fall on Thursday pulled the Sensex down from its historic high of 7,288 points, as the index closed flat on Friday at 7,212 mark. The Nifty slipped 0.71 per cent over the week to close at 2,196 points.

Among the broader indices, the S&P CNX 500 rose 0.63 per cent, while the CNX Midcap 200 closed up 3.63 per cent.

Markets had an auspicious start on Monday. While the 30-stock BSE Sensex zoomed 66.54 points to settle at 7,277.31, the Nifty closed up 18.75 points at 2,230.65 mark. Midcap stocks too were in action--the CNX Midcap 200 gained 1.62 per cent on Monday. Almost all the sectors attracted investors' attention with healthcare, banking and IT stocks leading the march.

The Sensex touched a historic high of 7,308.72 points but succumbed to profit booking on Tuesday. After a volatile session, the index shed 57 points before settling at 7,220.25 points. The crash was led by technology and healthcare stocks.

After a brief stopover on Tuesday, the equity markets continued their upward journey on Wednesday. Both the Sensex and the Nifty closing at all-time highs. While the former gained nearly 1 per cent to close at 7,287, the Nifty closed up 0.8 per cent at 2,228 mark. FIIs continued their support and led the rally. The equity investors even ignored the rising world crude oil prices, which rose to nearly $60 per barrel. Midcap stocks too saw a lot of activity. Wednesday's rally was led by FMCG, metal and banking stocks.

Then came the London blasts. This coupled with surge in global oil prices triggered a 142.47 points fall in the Sensex on Thursday. Nifty too fell nearly 49 points to 2,179.40 mark. The slide was led by index heavyweights including ONGC, Reliance and Hindalco. Auto, banking, FMCG, technology and telecom sectors were also under heavy selling pressures.

Equity markets staged a strong comeback on Friday. Buying across almost all sectors boosted the market sentiments as the 30-scrip BSE Sensex gained 67 points before ending the day at 7,212.08 mark. The Nifty too added 27 points to close at 2,206.60 mark. Steel, technology, banking, cement, pharma and auto counters provided strength to the markets. However, some of the counters like Bajaj Auto, ONGC, Tata, REL were quoted lower on selling pressure. Bharati Televentures, TISCO and L&T were the top three gainers of the day.

Among the 30 Sensex constituents, 13 stocks lost over the week. The pack of losers was led by 6.44 per cent slide in the ONGC. L&T, HLL and Reliance Energy lost over 3.50 per cent each.

HDFC Bank added 5.20 per cent, followed by over 4.50 per cent rise in Tata Motors and HPCL.

Among the sectoral indices, the BSE Metal Index was on fire. The index recovered from its previous week's loss of 4.24 per cent by adding 4.73 per cent. Banking stocks too were in action. The BSE Bankex rose 2.44 per cent over the week. Technology stocks, though, were under pressure. The BSE IT index fell 1.25 per cent over the week.

The combined daily average turnover on both exchanges went down by 4.17 per cent to Rs 8,723 crore.

Foreign institutional investors continued their support to the Indian equity markets and invested over Rs 1,684 crore. Mutual funds, though, sold stocks worth over Rs 200 crore.

Outlook

Immediate recovery after the London blasts is a big positive for the Indian equity markets. With FIIs still pumping in handsome sums, the rally might continue in days to come.