rediff.com

NewsApp (Free)

Read news as it happens
Download NewsApp

Available on  

Rediff News  All News 
Rediff.com  » Business » Sensex crashes by over 550 points; inflation to blame

Sensex crashes by over 550 points; inflation to blame

Last updated on: January 7, 2011 15:27 IST

Sensex crashes by over 550 points; inflation to blame

     Next

Next

The Bombay Stock Exchange's benchmark 30-stocks index -- the Sensex -- tumbled by over 550 points on Friday on fears that the Reserve Bank of India will increase interest rates to curb surging inflation.

Soaring prices of onions and other vegetables led to a sharp rise in inflation at 18.32 per cent for the week ended December 25, a development that most analysts fear may prompt the RBI to tighten monetary policy to check further escalation in commodity costs.

If that happens it will mean more pain for the common man, as the only way the RBI can control runaway inflation is by increasing interest rates and sucking out the liquidity in the system.

If interest rates are increased, then home loans, car loans, personal and educational loans, etc will become costlier, putting these out of reach of the common man.

Click NEXT to read on . . . 


Photographs: Reuters
     Next

Sensex crashes by over 550 points; inflation to blame

Prev     Next
Prev

Next

The Sensex closed the last trading day of the week on Friday shedding more than 540 points.

The markets were negative for the major part of the day as there was a sell off in the auto and metal sectors.

The BSE benchmark index is currently down 541 points at 19,634 and the Nifty has lost 160 points to trade at 5,889.

In the broader markets, the situation was no different. The midcap and the smallcap indices shed nearly 2% underperforming the Sensex, which is down 1.6%.

Click NEXT to read on . . . 


Photographs: Reuters
Prev     Next

Sensex crashes by over 550 points; inflation to blame

Prev     Next
Prev

Next

At the start of the trading session on Friday, the Sensex was momentarily in the positive only to slip on back of weak global cues and selling pressure in auto stocks.

There was not much recovery in the markets from there on. The sharpest fall was seen during the last half hour of trading when the Sensex touched the day's low of 19,644, down 541 points from the opening.

The Asian markets closed the day on a mixed note as Asia scrambles to contain food inflation. Record high food prices are moving to the top of policymaker agendas, driven by fears it could stoke inflation, protectionism and unrest and dent consumer demand in key emerging economies.

Click NEXT to read on . . . 


Photographs: Reuters
Prev     Next

Sensex crashes by over 550 points; inflation to blame

Prev     Next
Prev

Next

KLSE Composite, Nikkei, Seoul Composite and Shanghai Composite gained between 0.1% - 0.5% in Friday's trades.

Meanwhile, Jakarta Composite lost 2% and Taiwan Weighted shed 1%. Hang Seng and Straits Times closed the week  shedding 0.4% and 0.7%, respectively.

In the European markets, all the indices opened in the negative for the second day in a row. DAX shed 0.4%, FTSE started down 0.6% and CAC lost 0.8%.

Click NEXT to read on . . . 


Photographs: Reuters
Prev     Next

Sensex crashes by over 550 points; inflation to blame

Prev     More
Prev

More

All the sectoral indices are trading in the negative. Metal and Auto scrips are the draggers down nearly 3% followed by IT and Consumer Durables shedding 2% each. The least affected in today's market is the banking space.

ICICI Bank and Reliance Communications up 0.7% and 0.1% are the only gainers on the Sensex.

Hindalco down 6%, Tata Motors, Mahindra & Mahindra, Bharti Airtel and HDFC losing 3 % - 4%  are the top losers.

The market breadth was very negative. About 2,300 stocks declined, while 619 advanced.


Photographs: Reuters
Prev     More
© Copyright 2013 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.