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Markets plunged to new lows in 2008 on Friday, following inflation reaching a 13-year high of 11.05 per cent. The BSE Sensex lost 517 points to close at 14,571, while Nifty fell 156 points to 4348.The markets were rattled by the spectre of rising interest rates. The bankers are now expecting a tightening of monetary policies in the wake of higher inflation numbers. Axis Bank expects further monetary tightening, while UCO Bank sees the Reserve Bank of India taking stern measures to cool prices. BNP Paribas sees the RBI to act even before its scheduled July meeting on monetary policy.
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The Finance Minister said that strong measures were needed on demand and monetary sides to check price rise in these “difficult times”. Except, ONGC all the stocks in the BSE-30 ended lower. Reliance Communications was the highest loser in this group falling 6.65 per cent to Rs 491. Sensex heavyweight RIL plunged to its lowest in 2008 to Rs 2096, down 6.6 per cent. Hindalco and Jaiprakash Associates were the other big losers in the BSE-30 group, losing over 6 per cent each.
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“The market’s momentum has reversed its direction. The investors should look for more short position, rather than long one,” said Devang Visaria, an investment consultant.Among the sectors, the oil and gas was the biggest loser on the BSE, falling 5 per cent to 9,420. Reliance Natural Resources, RIL, Essar Oil, Cairn India and RPL were among the major losers, down over by 5 per cent each. The interest-rate sensitive sectors real estate, banking and auto were also among the major losers. Real estate player Omaxe sees growth being hit due to higher lending rates, while leading automaker Maruti described the current situation as “out of control”.
“The market’s momentum has reversed its direction. The investors should look for more short position, rather than long one,” said Devang Visaria, an investment consultant.Among the sectors, the oil and gas was the biggest loser on the BSE, falling 5 per cent to 9,420. Reliance Natural Resources, RIL, Essar Oil, Cairn India and RPL were among the major losers, down over by 5 per cent each. The interest-rate sensitive sectors real estate, banking and auto were also among the major losers. Real estate player Omaxe sees growth being hit due to higher lending rates, while leading automaker Maruti described the current situation as “out of control”. .
The realty index on the BSE was down about 4.5 per cent, while auto saw a less impact, down 2.44 per cent.
The realty index on the BSE was down about 4.5 per cent, while auto saw a less impact, down 2.44 per cent.
