Sensex dips below the 16K level, may fall further | business | Hindustan Times
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Sensex dips below the 16K level, may fall further

business Updated: Oct 31, 2009 12:12 IST

Stocks: The 30-share benchmark Sensex plunged 10 per cent in two weeks to fall below the psychological level of 16,000 points even as the market showed signs of a further slide ahead on growing concerns of a likely interest rate hike after the RBI raised inflation projection.

Heavy losses after the market touched more than analysts see its 17-month high of 17,493.17 on Diwali 'muhurat' trading on October 17 as a healthy correction to the overbought market.

In the week to October 31, the Bombay Stock Exchange tumbled by 914.53 points or 5.44 per cent to end the week at an eight-week low of 15,896.28 from its last week's close, while it recorded a 10 per cent fall or that of 1,596 points from the 'muhurat' trading high.

The broader 50-share Nifty of the National Stock Exchange also dropped by 285.35 points or 5.71 per cent to end at 4,711.70 points from its previous week's close. It had risen to a high of 5,176.80 during Diwali trading.

The market witnessed high volatility in the week under review due to heavy rollover of positions in the derivatives segment as the October contract expired on Thursday.

The market registered heavy losses on October 27 as the RBI raised the statutory liquidity ratio (SLR) by one per cent to 25 per cent, which is expected to drain liquidity to the tune of Rs 30,000 crore from the system.