Market extends losses to another day as Sensex dips 354 pts

Mumbai, Aug 7 (PTI) Weak global cues and continuing
monsoon concerns dragged down the markets for the second
consecutive day on Friday and the Bombay Stock Exchange (BSE)
benchmark Sensex ended 354 points lower against its previous
close despite a strong response to the initial public offer by
the state-run NHPC.

Attempting a recovery from its intra-day low, the Bombay
Stock Exchange 30-share barometer finally ended the day at
15,160.24, clocking a fall of 353.79 points or 2.28 per cent
against its previous close.

The market lost 744 points or 4.68 per cent in two days.

Brokers said the overwhelming response to the initial
public offer by NHPC, which was subscribed 3.22 times by 1400
hours on its opening day on Friday, raised concerns that it
will absorb liquidity from the market.

Sustained pullout by foreign institutional investors also
triggered across the board sell-off in Indian bourses. The
provisional data on the National Stock Exchange (NSE) showed
FIIS sold shares worth Rs 1,062 crore in two days on August 5
and 6.

The broader 50-share Nifty of the National Stock Exchange
also dropped by 104.10 points or 2.27 per cent to 4,481.40
against its last close.

Bonanza Portfolio Assistant Vice-President Avinash Gupta
said, "Monsoon concerns pulled the market down. Global cues
were also weak and added to the downslide ..."

Among Asian indices, the Hang Seng was down 2.51 per
cent, Straits Times 2.0 per cent and Shanghai Composite 2.85
per cent. The Nikkei and Kospi, however, ended in the green.

The European markets were trading lower by about 0.50 per
cent to 0.85 per cent this afternoon.

Among the 30 Sensex firms, only three ended in the green
with nominal gains.

Reliance Industries dropped 2.47 per cent, Infosys 0.62
per cent, ICICI Bank 3.62 per cent and State Bank of India
3.08 per cent. The four carry nearly 33 per cent weight on the
Sensex.

The sensitive index fell 4.73 per cent in two sessions,
as investors sold heavily on the market's near 19 per cent
rally over the previous three weeks. Earlier, the rally was
driven by strong domestic and global corporate earnings.

The consumer durables index suffered the most, losing
3.92 per cent to 3,013.23.

Next was the auto sector, which fell 3.87 per cent to
5,457.09, extending a 4.4 per cent drop in the previous
session.

The realty index was the third-biggest loser and fell
3.29 per cent to 3,676.95, followed by the banking index, by
2.96 per cent to 8,110.08. PTI JCG
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