Sensex Slumps 209 Points as Central Bank Hikes Policy Rates

Mumbai, March 17 (IANS) A benchmark index of Indian equities markets declined over one percent Thursday on heavy selling pressure in auto, consumer goods, metal and banking scrips, as the central bank hiked key policy rates for the eighth time in 15 months to curb inflation.

The 30-share sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which opened deep in the red at 18,227.16 points, ended at 18,149.87 points, down 1.14 percent or 208.82 points from the previous close of 18,358.69 points.

At the National Stock Exchange (NSE), the S&P CNX Nifty closed 1.17 percent or 64.50 points down at 5,446.65 points.

There was heavy selling pressure in interest rate-sensitive stocks as the country's central bank hiked its short-term lending and borrowing rates by 25 basis points each for the eighth time in 15 months to tame inflation in a move that could make corporate, housing and auto loans dearer.

In its mid-quarter review of the monetary policy, the Reserve Bank of India (RBI) Thursday also revised upward its inflation forecast sharply to 8 percent by end-March, from 7 percent forecast in January and a lower 5.5 percent in November.

On the broader markets, the BSE midcap declined 0.29 percent and the BSE smallcap closed 0.38 percent down.

Most sectoral indices closed in the red. The BSE FMCG and IT indices slumped over one and a half percent. The auto index fell 1.27 percent, the metal index declined 1.18 percent. The BSE Bankex closed 0.79 percent down.

Maruti Suzuki tumbled 4.44 percent at Rs.1,169.25. The top losers on the Sensex were HDFC, down 3.68 percent at Rs.637.35; Hindalco Inds, down 2.49 percent at Rs.198.05; DLF, down 2.12 percent at Rs.221.70; Infosys, down 1.79 percent at Rs.2,981.25; and ITC, down 1.72 percent at Rs.168.25.

Major Sensex gainers were: Reliance Comm, up 3.50 percent at Rs.106.55; BHEL, up 1.98 percent at Rs.1,965.10; Reliance Infra, up 1.16 percent at Rs.652.80; and Cipla, up 0.98 percent at Rs.298.95.

Other Asian markets also closed in the red. The Japanese Nikkei average retreated 1.44 percent at 8,962.67 points. Japanese stocks witnessed extremely volatile trading in the last four session amid concerns of a nuclear meltdown following last week's devastating earthquake and tsunami.

Hong Kong's Hang Seng fell 1.83 percent at 22,284.40 points and China's Shanghai Composite closed 1.14 percent down at 2,897.30 points.

However, European markets were in the green. Around mid-day, the French CAC 40 was trading 0.71 percent higher, Britain's FTSE 100 was up 0.47 percent and the German DAX was ruling 0.37 percent higher.



Top Stories

Leave a Comment

Title: Sensex Slumps 209 Points as Central Bank Hikes Policy Rates

You have 2000 characters left.


Please write your correct name and email address. Kindly do not post any personal, abusive, defamatory, infringing, obscene, indecent, discriminatory or unlawful or similar comments. will not be responsible for any defamatory message posted under this article.

Please note that sending false messages to insult, defame, intimidate, mislead or deceive people or to intentionally cause public disorder is punishable under law. It is obligatory on Daijiworld to provide the IP address and other details of senders of such comments, to the authority concerned upon request.

Hence, sending offensive comments using daijiworld will be purely at your own risk, and in no way will be held responsible.