Sensex falls 228 pts to close below 18k level | business | Hindustan Times
Today in New Delhi, India
Mar 28, 2017-Tuesday
New Delhi
  • Humidity
  • Wind

Sensex falls 228 pts to close below 18k level

business Updated: Aug 27, 2010 17:46 IST

The BSE benchmark Sensex plunged 228 points on Friday to close below the psychological 18,000-level for the first time in about one month on fag-end brisk selling by nervous fund houses ahead of key economic data from the US.

Led by heavy profit-booking in realty, banking and IT stocks, the Bombay Stock Exchange's 30-share bellwether closed the day lower by 227.94 points, or 1.2 per cent, at 17,998.41, its worst closing since July 30. The Sensex had closed July at 17,868.29 level.

The wide-based 50-share Nifty Index of the National Stock Exchange, too, lost 1.26 per cent to finish at 5,408.70.

On a weekly basis, the Sensex recorded a fall of 2.2 per cent this week.

Analysts said nervous investors preferred to book profits ahead of crucial GDP data for the world's biggest economy, the US, and a statement from Federal Reserve Chief Ben Bernanke.

The market sentiment was already dampened after weak economic data on jobs and housing and any negative news this time may trigger a further sell-off by fund houses, said an analyst.

A smart climb in ONGC and Tata Steel was washed off with all-round profit booking, especially in realty, banking and IT stocks. Except oil and gas, all the 13 sectoral indices of the BSE ended in the red, with losses ranging from 1 to 2.6 per cent.

"There is nervousness among investors on concerns of the pace of global economic recovery. Indian markets have already rose at a level from where a correction cannot be averted," Anand Rathi Securities Head of Research DD Sharma said.

ICICI Bank plunged 2.84 per cent, SBI 2.16 per cent, HDFC Bank 1.7 per cent and HDFC 0.8 per cent. Realty major DLF sank 3.30 per cent, the most in the Sensex pack.

IT bellwether Infosys, which has the highest weightage in the Sensex after RIL, tanked nearly 2 per cent. TCS lost 2.10 per cent and Wipro 0.88 per cent.

Analysts said, investors were concerned about the pace of the recovery in the world's largest economy US and some changes in the DTC, which has hiked the minimum alternative tax to 20 per cent.

"Though there have been some relaxation in corporate tax, but rise in MAT is a matter of concern for investors," Sharma added.

Yesterday, the Cabinet approved the Direct Tax Code (DTC) Bill, including tax rates, which will now be presented to the Standing Committee of Parliament with possible implementation from April, 2011.

There in no change on capital gains tax, while corporate tax rates have been reduced to 30 per cent without any additional surcharge or cess. MAT has been set at 20 per cent of book profits. Personal tax rate slabs have also been increased.