By IANS
Mumbai : Indian stock markets crashed Friday and led a key index to shed more than 500 points, taking cues from weak global markets and large-scale selling in heavyweight stocks.
The sensitive index (Sensex) of the Bombay Stock Exchange (BSE) witnessed its sharpest fall since April 2, with the barometer index dropping 541.74 points, or 3.43 percent, to close the day at 15,234.57 points.
At this level, the index is at its lowest since July 12. It had shed 4.7 percent on April 2.
The index opened weak at 15,487.76 points Friday, down 288.55 points from the previous day's close at 15,776.31 points. Soon after, it touched the day's high of 15,495.51 points.
By noon, however, it fell to the day's low of 15,159.68 points and settled at the current level after wild fluctuations. The mood was gauged by the fact that as many as 27 out of 30 shares that go into the Sensex basket ended in the red.
"After the bull run we have seen for the past few weeks, a correction was bound to happen. This drop cannot be taken as something negative. It was a correction, triggered by global developments," said an analyst with a brokerage here.
"The decline in the global markets and the prediction of higher inflation rates on the domestic front have affected the investors' sentiments which has led to the selling pressure," said PHD Chamber president Sanjay Bhatia.
Possibly, the higher interest rates have begun to have a negative impact on the corporate earnings, which may have affected the investors' perceptions, he said, adding that the fall Friday was a technical correction.
In a similar vein, Venugopal N. Dhoot, president of the Associated Chambers of Commerce and Industry (Assocham) advised the investors not to panic, wince the Indian economy fundamentals were strong.
"This is a temporary phase and stock market would give the corrective evaluation of the state of the economy."
The three Sensex shares that bucked the trend were ITC, up 3.12 percent at Rs.171.80, Ranbaxy Laboratories, up 0.40 percent at Rs.374.90, and Ambuja Cement, up 0.28 percent at Rs.125.05.
Tata Steel, on the other hand, led the losers, down 7.37 percent at Rs.651.60, followed by Reliance Communications, down 5.65 percent at Rs.537.35, and Bharat Heavy Electricals, down 5.40 percent at Rs.1,660.40.
Housing Development Finance Corp, Hindalco, Larsen and Toubro, Reliance Energy, Satyam Computers, Oil and Natural Gas Corp and HDFC Bank were also among those shares that shed ground Friday.