The Hindu Business Line : Market tumbles yet again tracking global weakness

Mumbai March 14 The Indian markets crashed on Wednesday as world markets fell heavily mirroring the sell-off in US stocks on concerns over losses faced by US sub prime mortgage lenders.

"The impact of losses in the sub prime mortgage group has cascaded across the financial sector, knocking down shares of investment banks and traditional lenders," said a report from ICICI Securities.

Asian markets ended in the negative zone after the NYSE and Nasdaq index fell 2.13 per cent and 2.15 per cent respectively on Tuesday.

The BSE-30 Sensex plunged 453.36 points or 3.49 per cent to close at 12,529.62, after two days of gains.

The NSE S&P CNX Nifty ended at 3,641.10 points, down 3.43 per cent.

Selling was seen across the board, with banking, construction and IT stocks coming under heavy pressure.

Asian markets fell more than two per cent, while the FTSE-100 in London was down 101.45 points at 6,059.70 at 7 p.m. IST.

The Singapore, Japan and Hong Kong indices also lost heavily.

"Concerns of mortgage defaults in the US have led to a crisis, indicating a slowdown in the broader US economy," said Mr Amogh Bhatavadekar, a dealer with Brics Securities.

Both foreign and domestic funds pulled out from the Indian markets, according to dealers.

FIIs were net sellers to the tune of Rs 541.37 crore as per the provisional figures on the NSE. Mutual funds were net sellers to Rs 13.48 crore on Tuesday.

"Retail investors are now adopting a wait and watch policy till the global markets get corrected," said Mr Ravindra Kasliwala, Head (Equities), Inventure Growth and Securities.

Stocks of 1,772 companies declined while 740 companies advanced on the BSE.

The BSE Bankex index fell 4.14 per cent to 6,268.28, while the IT index dipped 3.97 per cent.

ICICI Bank was the top loser on the Sensex, down 5.43 per cent to Rs 829.70, followed by Bharti Airtel (Rs 729.05), down 4.72 per cent, and Wipro (Rs 555.25), down 4.58 per cent.

Only two of the Sensex stocks gained: Bajaj Auto (Rs 2,529.30) was up 0.39 per cent while Gujarat Ambuja Cements (Rs 106.15) gained 0.19 per cent.

However, dealers see value buying in the markets providing a good investment opportunity.

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