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Sensex falls into deep trench

Our Bureau

MUMBAI, Sept. 17

STOCK prices, across the board, dropped like nine pins today apparently ``completing the full eight-year circle'' pushing down the benchmark indices to near eight-year low. The mayhem was attributed to largescale selling by the foreign institutional inve stors (FIIs) which were seen repatriating funds expecting uncertainty on how the USA markets would behave after they reopened on Monday.

The Dow Jones Industrial Average on the New York Stock Exchange plunged over 482 points and Nasdaq index shed over 100 points within minutes of reopening Monday morning after the unprecedented terrorist attacks last Tuesday forced US administration closu re of the markets.

Back home, Monday's 149-points fall in the BSE-30 shares sensitive index (Sensex) completed the full circle of three bull phases and equal number of bear phases. The Sensex dropped 190 points to touch the intra-day low of 2,640 in the early session. The Sensex recovered partly towards to end of the session to close at 2,680.98, losing 149.14 points or 5.27 per cent over last close.

At NSE, the S&P CNX Nifty shed 56 points to close at 863.5. With today's fall, the Sensex has lost nearly 469 points or 17.5 per cent during the last four sessions from September 12 when terrorists struck in the US.

Earlier, the Sensex had touched intra-day low of 2,635 on April 11, 1993. In the intervening period, there were three bull phases during 1995, 1998 and 1999-2000 each one followed by a bear phase. At NSE, the Nifty has gone down nearly 15 per cent its ba se level in the last six years. The Nifty was launched during 1995 with a base level of 1,000.

Nervousness in the equity markets spread to the currency markets pushing down rupee to new low of Rs 48.42/43 to a dollar. The rupee bounced back to close at Rs 47.82/83, near previous close.

The selling by FIIs continued as was evident in many bluechips locked at lower circuit breaker limit. Government of Singapore Investment Corporation, Morgan Stanley, Janus and other funds were seen as major sellers, dealers said. GSIC was reported to be a major seller in Infosys which hit the 10 per cent lower circuit at 11.28 a.m. It recovered briefly and slipped back to the lower circuit at 11.33 am where it remained throughout the day. Other blue chips that suffered heavy losses included Indian Hotel s, Digital Equipment, Satyam Computer, ACC, NIIT, M&M, L&T, RPL, SBI, Zee, Tata Tea, Telco, Tisco, Tata Power, Novartis, BHEL and HLL.

During the last four sessions, FIIs are have been net sellers of Indian equities worth over Rs 239 crore. During the month-to-date, FIIs' net sales were Rs 331 crore.