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Sensex plummets to six-week low

business Updated: Jan 21, 2009 17:47 IST

PTI
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Tumbling for the second straight day on Wednesday, the benchmark Sensex closed below 9,000-level, its lowest level since December 5, on a spate of weak cues such as sharp fall in global bourses and disappointing third quartet earnings by HDFC and Wipro.

Selling pressure sparked by weak global cues got intensified after after Planning Commission Deputy Chairman Montek Singh Ahluwalia ruled out the possibility of any more stimulus package to boost economic growth in 2008-09.

The 30-share BSE barometer closed the day at 8,779.17, down by 321.38 points or 3.53 per cent, with blue-chips in metal, power and banking counters suffering heavy losses.

The broader 50-share Nifty of the National Stock Exchange also dropped by 90.45 points or 3.23 per cent to close at 2,706.15 from its last close.

The BSE barometer dipped below 9,000 level in the opening trade taking cues from the Wall Street where the Dow Industrial Average declined more than four per cent overnight.

Marketmen said the financial health of banks in the West with more "toxix" assets than deposits remained a big worry for investors who anticipate the global economic downturn to protract.

The immediate trigger for big looses in the Wall Street yesterday was Royal Bank's Scotland's estimate of over USD 40 billion losses for 2008, which came as a shock to the banking sentiment which was already battered by Citigroup's and Bank of America whopping losses for fourth quarter.

The sentiment was further dampened by disappointing third quarter results by housing finance major HDFC and Wipro.

HDFC fell by 7.49 per cent after the company reported a 15.73 per cent decline in PAT for the third quarter. India's third largest software exporter Wipro was down 3.5 per cent as the company's third quarter results announced early this morning failed to satisfy investors.