The Hindu Business Line : Sensex loses 267 in line with global markets

Freefall mode
All indices end in red; BSE FMCG biggest loser
Activity-based trading; futures, cash difference slim
Rumours of NSE notices to brokers create nervousness

Mumbai , July 21

The continuing weak trend on global markets and fears of possible interest rate hikes next week by the Reserve Bank of India wiped out most of Thursday's gains on equity markets.

The BSE-30 Sensex closed at 10,085.91 points, down by 267.03 points or 2.58 per cent. All indices ended in the red, with the BSE FMCG being the biggest loser, down 1,850.34 points or 3.63 per cent.

The NSE S&P CNX Nifty ended at 2,945 points, down by 2.58 per cent.

"The positive results of Satyam Computers and Tata Steel were also in line with the expectations and hence, did not have a great impact on the markets to rescue it from the negative zone," a dealer said.

Rumours on NSE notices

Rumours that the NSE had issued notices to top brokers on client shares mismanaged by them added to general market nervousness. Market sources said that the discrepancy occurred in the F&O segment.

The mismanagement reportedly occurred on account of brokers having pledged client shares as their own to the NSE.

The shares were than used by the exchange to fulfil margin requirement of these brokers in the recent market crash.

The NSE was apparently made aware of the issue recently by clients whose shares had been pledged by the brokers.

When contacted, senior NSE officials said that a letter had been issued to around 15 clearing members seeking confirmation on how securities were being held. Terming it as routine, officials said that these members have been given time up to July 31, by which time they would have to furnish relevant details.