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Sensex plummets on rupee's fall, political crisis, Japanese scandal

Stock prices fell heavily, dropping the Sensex below the psychological barrier of 3500 mark on the Bombay Stock Exchange today following the weakening of the Indian rupee and fluid political situation at the Centre, foreign institutional investors have made heavy offloading at index-based counters.

Share prices on the Hong Kong exchange were also on a southward journey on account of the announcement of closure of a major Japanese brokerage firm, Yamaichi Securities, which had an adverse affect on the Indian capital market, leading brokers said.

The Indian currency declined to an all time low of Rs 38.50-55 during the intraday trading on heavy import covering and uncertain political situation coupled with the decision of union government to free the petroleum sector from administered price mechanism at the in the beginning of 21^st century, this forced FIIs to offloading at the capital market, they added.

Reflecting the downtrend, the BSE Sensitive Index (30 scrips) opened slightly lower at 3512.82 points, then dropped below the 3400 mark to be quoted at 3399.72 points in the afternoon session. At the fag end, domestic institutions bought sizeable amount of shares which pushed the Sensex up to close to 3403.07 points, suffering a net loss of 120.37 points as against Friday's close of 3523.44 points.

FIIs sold 2.5 million State Bank of India shares and a good amount of TISCO, ITC, MTNL, and other blue chips. On the contrary domestic institutions -- Unit Trust of India, Life Insurance Corporation of India, General Insurance Corporation of India -- injected considerable amount of heavy-weighted shares at level, brokers added.

The broadbased BSE National Index (100 scrips) declined to 1478.02 points over the last trading day's close of 1525.22 points, losing by 47.20 points.

The BSE-200 and Dollex Index came down by 09.95 and 07.98 points to 334.74 and 145.17 points as compared to previous close of 344.69 and 153.15 points respectively.

The BSE recorded a shorter badla session of 10 per cent and backwardation charges in 14 scrips on Saturday. A leading investment analyst said the present prices of equities are good buys for long-term investment, but common investors would prefer to adopt the approach of wait-and-watch at this juncture.

Investors also were watching developments in the Asian markets particularly in South Korea, where a banking crisis and currency plunge forced the government to seek help from the International Monetary Fund.

The economic affairs expert committee of the Associated chambers of Commerce and Industry of India (Assocham) Chairman K B Dadiseth said that devaluation of Indian currency will lead to underpricing of imports which will adversely affect domestic growth and profitability.

Tobacco giant ITC registered the highest turnover of Rs 3.8 billion million out of Rs 8.7 billion, followed by SBI Rs 1.9 million, Reliance Rs 602.4 million, Tata Tea Rs 351.3 million, TISCO Rs 255.1 million.

Other scrips -- Castrol Rs 217.9 million, GE Shipping Rs 205.8 million, TELCO Rs 174.6 million, Hind Lever Rs 157.3 million, MTNL Rs 110.3 million, ACC Rs 91.8 million, BHEL Rs 67.6 million, Bajaj Auto Rs 51.8 million and Hindalco Rs 40.9 million in the specified counters.

Good transactions were witnessed at Satyam Comp (Rs 59.7 million), Zee Telefilm (Rs 31.4 million), Infosys Tech (Rs 16.7 million), Aptech Limited (Rs 10.5 million), JK Corp Limited (Rs 8.8 million), Oil and Natural Gas (Rs 5.7 million) in non-specified counters.

Hero Honda lost sharply by Rs 62.25 to Rs 850.50, ACC declined by Rs 41.50 to Rs 1145.00, Siemens came down by Rs 21.75 to Rs 197.00, State Bank by Rs 24.25 to Rs 218.75, Tata Steel by Rs 11.75 to Rs 126.25, L&T by Rs 8.50 to Rs 177.50, Reliance by Rs 7 to Rs 148.75 and Bajaj Auto by Rs 6.75 to Rs 552.75.

However, Housing Development and Finance Corporation gained by Rs 5.25 to Rs 2,955.25 and Sesa Goa limited improved by Re 0.75 to Rs 162.75.

UNI