In tune with each and every country in Asia and most in Europe, India’s stockmarket index, the BSE Sensex, fell as much as 791 points (or 7.3 per cent) during the day to try and sink below the 10,000 mark. It failed, closing 228 points down at 10,582.
It was almost like visiting February 7, 2006, when the Sensex had closed over 10,000 for the first time. It’s been a hectic and volatile boom-doom-gloom journey since then. It took 462 exuberance-laden days for the Sensex to move from 10,000 to cross 20,000 on December 11, 2007.
Almost as if perched on a precipice, the reverse journey has been covered in less than half the time, 190 days. With it, not only have the hopes of millions of first-time small speculators been razed, the real economy is facing its perhaps biggest challenge, with layoffs in the airlines industry only the first signal.
Companies in sectors as varied as oil and gas and information technology fell the most. Index heavyweight Reliance Industries crashed 8.4 per cent, touching a 52-week low of Rs 1,325.
Curiously, real estate stocks, that are perhaps facing their worst cash-flow and perception crisis in four years, bucked the trend, rising 5 per cent, with DLF closing 8.3 per cent higher at Rs 325. This is unlikely to last.
With recessionary expectations in the air, the Sensex fall mirrored the world. All Asian neighbours were in the red, with Japan, South Korea and Singapore down 11.4 per cent, 9.4 per cent and 5.3 per cent. Europe fared marginally better, with three countries — Germany, Finland and Switzerland — closing marginally higher.