Sensex falls for 4th straight week, down 191 points
Mumbai: Friday's mayhem following fall in the rupee value to an all-time low amid concerns over the continuity of US Fed's stimulus programme washed out all initial gains of the benchmark S&P BSE Sensex.
It witnessed a decline of 191 points, extending losses for the fourth straight week.
The market was closed on August 15, 2013 on account of "Independence Day".
The Bombay Stock Exchange 30-share barometer resumed the week higher on the back of an increase in exports and hopes of additional measures to support the rupee.
On August 10, top finance ministry officials worked to firm up more steps to arrest the sliding rupee and contain the current account deficit (CAD) as they continued discussions initiated by Finance Minister P Chidambaram a day earlier.
Commerce Secretary S R Rao said exports grew 11.64 per cent to USD 25.83 billion in July, while imports declined 6.2 percent to USD 38.1 billion, leaving a trade deficit of USD 12.2 billion.
It also ignored the data, which showed that inflation based on the Wholesale Price Index (WPI) shot up to a five-month high of 5.79 per cent from 4.86 percent in June.
Sensex then also rallied further to touch a high of 19,392.56 on Wednesday as the government on Tuesday increased import duty on gold, silver and platinum to 10 percent to stem the rupee fall.
The S&P Sensex crashed 769 points on Friday, the most in 4 years, as the rupee plunged to an all-time low amid fears the government may move to a capital-control regime to curb forex volatility and narrow CAD.
This was the largest point-wise fall since July 6, 2009, when the index plunged by 869.65 points.
The Sensex finally ended the week down by 191.16 points or 1.02 percent at about 1-1/2-month low of 18,598.18. It has tanked by 1,551.67 points or 7.70 percent in straight four-weeks of fall.
The broader 50-issue CNX Nifty of NSE also dipped by 57.80 points or 1.04 percent to end at 4-month low of 5,507.85.
The rupee fell below the 62 level for the first time, plummeting to 62.03 against the dollar on Friday, after the RBI announced additional steps on Wednesday to restrict foreign-exchange outflows and gold imports.
The stock markets were also jolted by weakness in global stocks on Friday after a steep fall at Wall Street on Thursday as jobless claims declined to the lowest level since 2007, renewing concerns that the US Federal Reserve would start withdrawing its stimulus as early as next month, leading to a flight of foreign capital from the domestic markets.
"The fear (among foreign investors) is that recent RBI measures may bring capital control measures back in a much bigger way. The markets crashed mainly because of this," said Gautam Sinha Roy, VP-Equities, Motilal Oswal Securities.
To curb dollar outflows, the RBI on August 14 announced stern measures, including curbs on Indian firms investing abroad and on outward remittances by resident Indians.
The RBI is not considering any capital control measures, it was clarified by Finance Ministry on Friday. Top RBI sources blamed "unwarranted rumours" about controls on FII money for the market crash. The Finance Ministry today said RBI's steps on Wednesday cannot be called capital control measures and they had more to do with reducing stress on balance sheets.
Tata Motors was the top gainer from the Sensex pack with a rise of 12.45 percent on strong July sales by its British luxury car unit Jaguar Land Rover.
Tata Steel also firmed up by 7.62 percent after first quarter consolidated net profit zoomed 90.51 percent.
19 scrips out of the 30-share Sensex pack ended lower while 11 others finished higher. Major losers were BHEL 9.87 percent, Tata Power 5.73 percent, SBI 5.43 percent, RIL 4.66 percent, Maruti Suzuki 4.43 percent, Coal India 3.67 percent, TCS 3.57 percent, HDFC Bank 3.53 percent, L&T 3.07 percent, Mahindra & Mahindra 2.74 percent, Dr Reddy 2.32 percent, ICICI Bank 1.89 percent, Bharti Air 1.79 percent, ITC 1.66 percent, Gail India 1.57 percent and HDFC 1.18 percent.
Among the major sectoral indices were S&P BSE-CD dropped by 4.91 percent followed by S&P BSE-Bankex 3.60 percent, S&P BSE-CG 3.02 percent, S&P BSE-Oil&Gas 2.20 percent and S&P BSE-Power 1.58 percent while S&P BSE-Metal rose by 4.48 percent followed by S&P BSE-Auto 3.96 percent, S&P BSE-HC 1.99 percent and S&P BSE-Realty 1.12 percent.
The total turnover at BSE and NSE rose to Rs 7,703.62 crore and Rs 47,982.11 crore as against the previous weekend's level of Rs 7,064.04 crore and 44,103.72 crore, respectively.
Meanwhile, Foreign Institutional Investors (FIIs) were net buyers of Rs 263.47 crore during the week including the provisional figure of August 16.