Equity markets crashed in the week ended October 28, 2005. Under pressure from profit booking led by foreign institutional investors, Indian stocks lost heavily. The 30-stock BSE Sensex skidded 383 points to end the week near its nine-week low of 7,685.64 points. Nifty too suffered. The index dipped 5.23 per cent over the week to close at 2,316.05 mark. Among the broader markets, the S&P CNX 500 closed 459 per cent down, while the CNX Midcap shed 3.62 per cent over the week.
Stock markets had an inauspicious start on Monday. Under pressure from across the board profit booking, the 30-stock BSE Sensex skidded from an intra-day high of 8,126 points to close 148 points down at 7,921 mark. The Nifty too shed 2 per cent to end the day at 2,395 points. Interestingly, mid-cap stocks held on to their gains--the CNX Midcap index shed only 0.10 per cent. Most counters ended in red. Pharma and FMCG stocks lost more.
Volatility ruled stock markets on Tuesday. After touching intra-day high of 8,074 points, the Sensex fell sharply and closed 71 points up from its Monday's close at 7,991 levels. The Nifty too added 23 points to end the day at 2,418 levels. Mid-cap stocks held on to their gains but did not rise much--the CNX Midcap closed up 0.35 per cent.
Equity markets had yet another volatile day on Wednesday. Ahead of the F&O expiry on Thursday, the Sensex closed 17 points down at 7,975 mark. Earlier in the day, the index had touched a high of 8,048 points. In the broader market, the Nifty lost nearly 10 points to end the day at 2,408 levels.
Equity markets had a free fall on Thursday. Under pressure throughout the day because of heavy profit booking, the 30-stock BSE Sensex lost 176 points to drop at a two-month low of 7,798. The Nifty too shed 56 points to end the day at 2,353 mark. Mid-caps too lost substantially, with the CNX Midcap index shedding 1.88 per cent over the day. Banking stocks were particularly hit.
Indian stocks dipped further on Friday. It was a third straight day of losses for equity investors. At the end of the day, the 30-stock BSE Sensex skidded 113 points to close near its nine-week low of 7,686 points. The Nifty too dipped 37 points to end the day at 2,316 mark. Mid-caps also suffered, as the CNX Midcap index shed 1.79 per cent on Friday. Heavy selling by foreign institutional investors has resulted into a bloodbath in the stock markets.
Among the sectoral indices, BSE Metal index was the worst sufferer in the week ended October 28, 2005. The index was down a massive 8.45 per cent, as prices of some steel stocks crashed. BSE Healthcare, FMCG and Bankex too dipped and ended the week down 5.15, 5.25 and 5.36 per cent, respectively.
The combined daily average turnover on both exchanges fell 14.71 per cent to Rs 8,257 crore in the week ended October 28, 2005.
This week's depression was primarily led by foreign institutional investors. They continued their selling spree and booked profits worth Rs 1,978 crore over the week. Domestic mutual funds, however, provided some support and bought shares worth Rs 1,068 crore.
Outlook
FIIs are on a selling spree, while mutual funds are pouring money in the markets. In the past, this trend has resulted into a crash on many occasions. However, some believe that it's a different story this time. In fact the recent fall was long overdue to cool down the overheated stock markets. Next week is crucial. However, the sentiments are likely to be jittery.
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