Satyam Computer leads the fall, Sensex down by 749 pts
Panic selling was seen across the board as all sectoral indices ended in the red with an average fall of 2.08 per cent to 16.95 per cent.business Updated: Jan 07, 2009 18:48 IST
The benchmark Sensex came down by a whopping 749 points on concerns over corporate governance after India's fourth-largest IT company by sales Satyam Computer Services admitted that its accounts were manipulated.
Panic selling was seen across the board as all sectoral indices ended in the red with an average fall of 2.08 per cent to 16.95 per cent.
Satyam Computer plunged into a deep crisis, as Chairman B Ramalinga Raju resigned after admitting to major financial wrong-doing, which might keep foreign investors away for the time being.
His brother and the Managing Director of the Company, B Rama Raju, also resigned. The promoters' share in Satyam has now dipped to just over 3 per cent, and that too is pledged with lenders.
The market regulator SEBI also said that it would take all necessary steps under the law. The counter was at the receiving end and slumped by 77.69 per cent at the end.
The Bombay Stock Exchange 30-share Sensex initially touched a high of 10,469.72, up by nearly 134 points, but it collapsed like a pack of cards after news of Satyam Computer filtered in.
It tumbled to close at 9,586.88, a net loss of 749.05 points, never seen since October 24, 2008, or 7.25 per cent over the previous close. The Sensex ended first in negative terrotory after January 1.
The broader 50-share Nifty of the National Stock Exchange also plunged 192.40 points or 6.18 per cent to 2,920.40 from the previous close.
Counters of realty, refinery and banking stocks also suffered a sharp setback and contributed to the fall.