Weakness in Rupee, Sensex Down 3.4%

123jump.com Staff
26 Sep, 2008
New York City

The weakness in financials and realty stocks and dragged the benchmark index lower. Tata Motors fell 3% after the conglomerate sold 1.3% in Tata Steel. Rupee lost 5.6% in the week and dropped as low as 46.97 before recovering to close today at 46.54 to a dollar.

[R]10:00AM New York, 7:30 PM Mumbai – Financial and realty stocks dragged Sensex index 3.4% lower after U.S. seized one of the oldest banks in the country.[/R]

Market Sentiment

Stocks in India fell on news that U.S. authorities have closed Washington Mutual and sold its assets to J.P. Morgan Chase & Co.

Financial stocks, commodity and realty stocks declined.

In Mumbai, the BSE 30-share Sensex declined 3.28% or 445 to 13,102.18, and the CNX Nifty plunged 3.34% or 137.10 to 3985.25.

Of the stocks traded on BSE 442 rose, 2172 declined and 59 were unchanged.

Trading Statistics

Daily turnover on BSE stood at 4,835 crore rupees from 5,070.61 crore rupees yesterday.
Ranbaxy Laboratories declined 8.04% to 272.40 rupees.

In the first nine months, foreign investors sold $9 billion of stocks compared to a purchase of $17.1 billion according to the latest data gathered from Securities & Exchange Board of India. The outflow of funds has depressed the value of rupee down 5.6% for the year and nearly 20% in the last fifteen months. In the week, rupee traded as low as 46.97 before recovering to 46.54 at the close today,

JP Morgan Buys Washington Mutual

Washington Mutual, the 120-years old savings bank was seized by the Federal regulators and its assets and branch network was sold in an auction to JP Morgan Chase. The bank has declared losses totaling more than $6 billion in the last three quarters in a row and recently raised $7.2 billion and replaced its longtime chief executive.

Washington Mutual, with $304 billion in assets faced a bank run that started on September 15. In the last ten days $16.7 billion of bank deposits were withdrawn, forcing regulators to seize the bank.

Gainers & Losers

Commodity stocks fell. Gujarat NRE Coke slipped 10% to 58.95 rupees, Jindal Steel & Power declined 7.25% to 1,310.70 rupees, Steel Authority of India fell 5.84% to 133.80 rupees, and Tata Steel slid 4.88% to 461.40 rupees.

Hindalco Industries declined 5.17% to 99.10 rupees.

Tata Motors slid 2.77% to 373.30 rupees after the company sold 1.3% in Tata Steel for 486 crore rupees. The company is also reportedly in talks with private funds to sell 25% in six unlisted companies.

Dabur India rose 2.30% to 89.05 rupees, ITC soared 2.04% to 192.25 rupees, and Hindustan Unilever edged up 1.18% to 252.50 rupees.

IT stocks declined. Infosys Technologies fell 3.80% to 1,447.70 rupees, Satyam Computer declined 1.86% to 321.95 rupees, TCS slipped 1.99% to 676.45 rupees, Wipro plunged 2.59% to 343.75 rupees, and HCL Technologies plunged 5.12% to 212.95.

Financial stocks fell. ICICI Bank dropped 5.83% to 561.25 rupees, HDFC Bank declined 4.05% to 1,232 rupees, Punjab National Bank slipped 4.03% to 472.10 rupees and State Bank of India dipped 3.99% to 1,434.20 rupees.

Realty stocks fell. Akruti City plummeted 16.74% to 799.60 rupees, Housing Development & Infrastructure declined 8.47% to 192.45 rupees, Unitech fell 8.03% to 111.05 rupees, and DLF shed 5.01% to 369.50 rupees.

Reliance Industries shed 3.17% to 1,960.90 rupees.