Indian Markets Crash, Sensex and NIFTY plunge

The inflation controlling measures taken by RBI on Friday sent the markets into a tail spin with NIFTY and Sensex plunging. Heavy selling pushed the Sensex and NIFTY to 12455.37 and 3633.60 respectively. Sensex lost 4.72% and NIFTY lost 4.92%.

RBI had announced increase of Cash Reserve Ratio by 50 BPS from 6% to 6.50% in two phases. First phase of 0.25% would come into effect on April 14 and the next would be on April 28. This is expected to drain liquidity of around 15,500 Crores from the banking system. Since December 2006, RBI has increased CRR from 5% to 6.5%.

RBI has also increased the Repo Rate by 25 BPS from 7.50% to 7.75% with immediate effect. The Repo Rate is the rate at which RBI infuses the liquidity in the system. RBI has also reduced the rate of interest on the eligible CRR balance to 0.5% p.a . from 1% p.a.

BSE Sensex opened the day at 12811.93 and went to hit a low of 12425.52 before closing at 12455.37, down by 616.73 points or 4.72% over its previous close of 13072.10. S&P CNX NIFTY opened at 3820 and went to hit an intraday low of 3617 before closing at 3633.60, down by 187.95 points or 4.92%.

The market breadth of BSE was negative with 702 advances against 1771 declines. There were 73 stocks which remained unchanged.

Out of 30 stocks in Sensex, there was not even one gainer with all 30 stocks closing lower. Maruti Udyog and Tata Motors were the top losers with both stocks losing above 8% during the day's trading. Maruti Udyog closed the day at Rs.753.40, down by Rs.66.30 or 8.09%. Tata Motors closed down by Rs.58.50 or 8.04% at Rs.669.25.

WIPRO lost 7.18% to close at Rs.518.25 (-Rs.40.10). Hero Honda Motors - Rs.639.35(down Rs.45.80 or -6.68%), State Bank of India - Rs.930.25(down Rs.62.65, -6.31%), L&T - Rs.1524.95(down Rs.94.20 or -5.82%), HDFC - Rs.1432.70(down Rs.87.65 or -5.77%), ICICI Bank - Rs.804.5(down Rs.48.60 or -5.70%), Tata Steel - Rs.424.10(down Rs.25.50 or -5.67%), ONGC - Rs.828.40(down Rs.49.75 or -5.67%), Reliance Communication - Rs.396.85(down Rs.23.15 or -5.51%), Bajaj Auto - Rs.2300.60(down Rs.124.85 or -5.15%), Satyam Computers - Rs.446.30(down Rs.23.80 or -5.06%), HDFC Bank Ltd - Rs.901.60(down Rs.47.80 or -5.03%).

ACC Ltd, Bharti Airtel, BHEL, Cipla Ltd, Hindustan Lever Ltd, Infosys Technologies, Reliance Industries lost more than 4%.

Out of 50 stocks in NIFTY, only GAIL was a gainer with the stock closing at Rs.266.95, up by Rs.2.40 or 0.91%. Oriental Bank of Commerce was the top loser in NIFTY with the stock closing down by 10.18% at Rs.168.55. Punjab National Bank was the second major loser with the stock closing down by 10.02% at Rs.426.70.

M&M and Maruti lost more than 8%, Tata Motors, Wipro, Hero Honda closed lower by more than 7%, HCL Technologies, SBI, ONGC lost more than 6%.

Source : Equity Bulls

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