Sensex plunges 863 points

The market reversed the course devoid of any major local or global trigger to guide the investors. It declined in all the five trading sessions in the week as rising crude prices and inflation marred the sentiment. The market also more or less tracked the global markets. The corporate results announced so far have been more or less in line with market expectations.

The BSE Sensex plunged 863.05 points or 4.9% to 16,737.07 in the week ended 9 May 2008. S&P CNX Nifty fell 245.6 points or 4.69% to 4,982.60 in the week.

The BSE Mid-Cap index declined 244.81 points or 3.38% to 6,992.66 in the week. The BSE Small-Cap index slumped 316.07 points or 3.58% to 8,472.67.

Foreign institutional investors (FII)’s sold shares worth Rs 75.10 crore in first few days in the month of May 2008. They sold shares worth Rs 10433.20 in calendar year 2008 till 7 May 2008. Domestic funds bought shares worth Rs 15.90 crore in first few days in the month of May 2008.

The 30-share BSE Sensex fell 109.22 points or 0.62% at 17,490.90 on Monday 5 May 2008. After trading within a narrow range earlier in the day, the market declined in late trading as US stock futures indicated lower opening on the Wall Street. Realty and healthcare stocks outperformed the market. Consumer durables and IT stocks dropped. Small-cap and mid-cap counters were active throughout the session with their barometer indices outperforming the Sensex.

The 30-share BSE Sensex fell 117.89 points or 0.67% at 17,373.01 on Tuesday, 6 May 2008. The key benchmark indices ended lower as investors resorted to profit booking due to lack of positive triggers in the market. Selling pressure was seen in mid-cap and small-cap counters with their barometers underperforming the Sensex. Realty and power stocks rose whereas FMCG and metal stocks gained. IT pivotals recovered at the fag end of the session after rupee slipped to eight-month low against the dollar.

The 30-share BSE Sensex fell 33.70 points or 0.19% at 17,339.31 on Wednesday, 7 May 2008. Weakness in Asian markets and a surge in crude oil prices spoiled the sentiments. IT and oil & gas stocks rose whereas capital goods stocks and the shares of PSU firms suffered the most.

The 30-share BSE Sensex fell 258.66 points or 1.49% at 17,080.65 on Thursday, 8 May 2008. The market succumbed to selling pressure as weak global equities and soaring crude oil prices worried investors. All the sectoral indices on BSE, barring the BSE Metal index, were in the red. Software and banking shares were worst hit.

The 30-share BSE Sensex lost 343.58 points or 2.01% at 16,737.07 on Friday, 9 May 2008. The market tumbled hit by a series of bad news on the domestic and global front. India's inflation surged to more than 3-year high, global markets declined and crude oil hit yet another record high near $125 a barrel. All the sectoral indices on BSE, barring FMCG index, were in red. Oil & gas, realty and banking stocks declined sharply.

India’s largest cigarrette maker by sales ITC declined 1.11% to Rs 218.30, and Axis Bank shed 10.38% to Rs 836.30 in the week. As per recent reports,, the Union government has given in-principle approval for SUUTI’s stake sale in these three companies. Specified Undertaking of Unit Trust of India (SUUTI) was created as a successor to UTI with the assets and liabilities of US 64 and its assured-return schemes, and it reportedly owns 9.04% in Larsen & Toubro (L&T), 11.90% in ITC and 27.18% in Axis Bank (as at end March 2008). The stake sale process is likely to be completed by the end of this financial year.

India’s largest telecom services provider by sales Bharti Airtel fell declined 6.28% to Rs 842.20 in the week. Bharti said it is in exploratory talks for a stake in South African telecom operator MTN Group. Bharti Airtel said the current discussions with the MTN Group are still at an early stage and they may or may not lead to any transaction. As per media reports, Bharti Airtel has arranged $12 billion of financing and may seek to buy 51% of MTN, valuing the company at about $39 billion. The acquisition would be the biggest by an Indian company, eclipsing Tata Steel’s $13 billion takeover of Corus Group Plc in 2007.

India’s largest truck maker by sales Tata Motors declined 3.14% to Rs 668.80. The company reported 5.8% fall in total automobile sales to 38,149 units in April 2008 over April 2007 largely on account of dip in passenger car segment and exports.

India's largest engineering and construction company in terms of revenue Larsen & Toubro fell 9.73% to Rs 2835.55. The company is about to undergo a massive restructuring that will result in the creation of a dozen operating companies under the guidance of separate board of directors. As per reports, the restructuring will lead to Larsen & Toubro (L&T) becoming the umbrella organisation with a board to administer the performance of all businesses and ownership of the brand, pegged at around $2 billion, effective from 1 July 2008.

Shares of India's largest cement manufacturer in terms of annual production capacity ACC fell 5.54% to Rs 712 in the week. ACC had said on Thursday, 8 May 2008, its margins will be hurt by a decision to hold its prices for 2 to 3 months that was taken after the government asked cement firms to help contain price pressures. pressures.

Wipro (down 0.2% to Rs 501.20), Infosys (down 2.18% to Rs 1,750.50), Tata Consultancy Services (down 2.48% to Rs 917.45), Satyam Computer Services (down 4.19% to Rs 473.40), ICICI Bank (down 6.57% to Rs 874.05), HDFC Bank (down 5.65% to Rs 1451.95), Reliance Industries (down 5.5% to Rs 1,527.65) edged lower in the week.

Aishwarya Telecom debuted at Rs 50.10, a premium of 43.14% and settled at Rs 90.85 a sharp premium of 159.57% over its issue price of Rs 35 (the top end of Rs 32- Rs 35 IPO price band) on 7 May 2008.

The market regulator Securities & Exchange Board of India (Sebi) on 5 May 2008 relaxed margining in the cash market segment which it called as an initial step towards cross margining in the cash market and futures segment. Cross margin facility will be available in case where a market participant has a position in the cash market with an off-setting stock futures position in the derivatives segment. Cross margining benefit will be initially available for only institutional investors.

Passenger car sales in rose 17.2% to 98,740 units in April 2008 over April 2007. Analysts attribute the growth to low base effect as sales were poor in April 2007. Sales of commercial vehicles -- trucks and buses, rose 7.6% to 33,271 units in April 2008 over April 2007.

Indian steel makers on Wednesday, 7 May 2008, agreed to cut prices in government’s efforts to rein in inflation. The public and private steel makers said they would cut the price of long products used in construction by Rs 2,000 a tonne, or 5.5%, and that of flat products by Rs 4,000 a tonne, or about 10%. Steel makers have also decided to hold the price line for the next three months. Steel makers, however, urged the government to discourage iron ore exports and withdraw the tax on steel exports.

The Reserve Bank of India (RBI) on Thursday, 8 May 2008, eased lending norms for infrastructure projects. In a notification RBI said bank loans to infrastructure projects would be treated as sub-standard only if commercial production is delayed by more than two years over the date originally envisaged, instead of the present norm of one year.

The wholesale price index rose 7.61% in the 12 months to 26 April 2008, marginally higher than previous week's annual rise of 7.57%, government data showed on Friday, 9 May 2008. The rate was the highest since an annual reading of 7.68% on 13 November 2004.

Finance Minister P Chidambaram on 9 May 2008, said the government has asked cement companies to reduce prices to curb inflation.

Crude oil for June 2008 delivery hit a record high $125.12 a barrel in electronic trading on the New York Mercantile Exchange on Friday, 9 May 2008. It is set for the biggest weekly gain since March last year, as concern violence in Nigeria will cut supply spurred speculative buying.