Sensex Tanks 245 Points As RBI Lowers Growth Forecast

Wednesday, July 31, 2013
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Mumbai: A benchmark index of Indian equities markets closed trade more than one percent or 245 points down after the Reserve Bank of India left all key policy rates unchanged and lowered growth prospect.

Interest sensitive stocks took a hit. Scrips of oil and gas, automobile, public sector undertakings (PSU), bank and fast moving consumer goods (FMCG) companies plummeted. However, there was good buying in the information technology (IT) stocks.

The 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE), which opened at 19,577.75 points, closed at 19,348.34 points, down 244.94 points or 1.25 percent from previous day's close at 19,593.28 points.

The Sensex touched a high of 19,672.72 points and a low of 19,328.54 points intraday.

At its review, India's central bank left all key policy rates untouched to calm currency markets that saw a sharp depreciation of the rupee in recent months, while it conceded that risks to growth have increased and retail inflation has remained high.

The repurchase or the repo rate, which is the interest the Reserve Bank of India (RBI) pays for short-term borrowings from commercial banks, has been left unchanged at 7.25 percent, so has the reverse repo, or short-term lending rate, which is at 6.25 percent.

The cash reserve ratio (CRR), or the share of deposits banks must keep with the central bank, is also maintained at four percent.

Major sectoral indices of the S&P BSE which declined included oil and gas, automobile, public sector undertakings (PSU), bank and fast moving consumer goods (FMCG).

The oil and gas index plummeted by 340.77 points, followed by automobile index which was down 220.12 points, PSU index was 174.22 points lower, bank index was down 150.82 points, and FMCG index was 136.30 points down.

However, IT index moved 67.10 points up.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) closed trade down 76.60 points or 1.31 percent down at 5,755.05 points.

The major Sensex gainers were: Wipro, up 2.75 percent at Rs.419.75; Jindal Steel, up 1.45 percent at Rs.202.25; Infosys, up 1.20 percent at Rs.2,955.70; Larsen and Toubro (L&T), up 0.97 percent at Rs.849.55; and Sun Pharma, up 0.92 percent at Rs.574.75.

The main losers were: ONGC, down 5.64 percent at Rs.280.85; Hindalco Inds, down 4.64 percent at Rs.86.40; Tata Motors, down 3.94 rcent at Rs.284.40; Bharti Airtel, down 3.76 percent at Rs.321.45; and Bajaj Auto, down 3.40 percent at Rs.1,927.90.

Among the Asian markets, Japan's Nikkei gained by 1.53 percent; Hong Kong's Hang Seng was up by 0.48 percent and China's Shanghai Composite Index was up by 0.70 percent.

In Europe, London's FTSE 100 was trading 0.28 percent up; Germany's DAX Index was up by 0.36 percent and the French CAC 40 Index was up by 0.49 percent.

Also Read:
6 Jewellers Who Rule the Indian Gold Market
5 Stress Busters to Lighten Your Debt Worries

Source: IANS
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