Bloodbath continues at Indian stock markets


Mumbai : Trading was halted at Indian stock markets Tuesday as key indices registered steep falls of over 10 percent minutes after the opening bell but the benchmark index staged a weak recovery after the markets reopened at 10.55 a.m.

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Even after reopening, the benchmark index clocked a loss of 1,285.95 points, down 7.30 percent over Monday’s close.

The 30-share sensitive index (Sensex) of the Bombay Stock Exchange (BSE) fell by 2,029.05 points, down 11.53 percent, minutes after trading began. The Sensex opened at 16,884.09 points and hit a low of 15,576.30 in early trade, prompting an automatic halt in trading at BSE.

An automatic halt is triggered if shares fall by more than 10 percent during a trading session.

The broader 50-share S&P CNX Nifty index of the National Stock Exchange also shed 60.45 points, down 12.10 percent at 4,578.35 points, compared to the previous close of 5,208.80 points.

Trading at the NSE has also begun and the Nifty is currently ruling at 4,825.78, still down 7.20 percent over Monday’s close.

The Sensex had lost over 2,000 points in intra-day trade Monday, as bears tightened their grip on the bourses amid worries over US recession, before staging a 700-point rally towards the closing bell.

Ascribing the steep fall to a “correction”, Prime Minister Manmohan Singh said Monday the value of shares in India would continue to grow as fundamentals of the economy remained strong.

“I am confident the markets will grow in an orderly fashion,” the prime minister said.

“From time to time, some corrections are part of the market process. I am sure and confident we will sustain orderly growth,” he added.

On Monday, the finance ministry also advised investors to exercise caution. It said the fundamentals of the Indian economy were strong and that the steep fall in Indian indices was less that those in other Asian economies.

“Today’s market fall reflects the continuing uncertainties in the global economy and not any change in the fundamentals of Indian economy,” said a statement issued by the ministry after the markets closed Monday.

“Investors should take informed and responsible decisions in the situation and not be led by market rumours or any unwarranted apprehensions.”