Sensex plunges 500 points, slides below 13K
It’s despair time on Dalal Street. Fears of high inflation and slowing growth compounded on Tuesday, as global crude prices rose again on a warning of long-term supply shortages and brewing tension in West Asia.
Like a pack of dominoes, stock markets fell worldwide, taking the Sensex down 500 points to under 13,000 — the first time in 10 months. The benchmark index has lost over a third of its value this year so far, making many stocks attractive. But experts say investors are still shying away because the overall economic outlook has turned gloomy.
Oil prices have risen by more than 50 per cent so far this year. The spike hurts India more than many other countries as it imports about 75 per cent of the crude needed to keep its economy going.
On Tuesday, crude jumped more than $2 after the International Energy Agency said supplies will stay tight until 2013 and arguments that speculators were driving up crude prices may be weak on evidence.