Indian Equity Market, Week ending February 20, 2009

Indian equities market commenced the week on an extremely flimsy note after interim budget failed to offer investors with anticipated tax sops and sectorspecific stimulus package for the sluggish economy. Huge selling pressure emerged swiping volumes across board after interim budget presented by Pranab Mukherjee on February 16, 2009 let down the market sentiments. By the end of day one, Sensex and Nifty tanked 330 points and 100 points respectively. Domestic market extended its losses for next two days as disappointment over the budget spilled for major part of the week. Sustained selling across the board caused Sensex to drift lower than the 9,050 mark. Nifty followed the suit plummeting below 2,800 mark by the second day of the week. Weak cues from the global markets also weighed on the sentiments. Fall in inflation bought some respite to the market providing room for the Reserve Bank of India (RBI) to cut interest rates further to shield the domestic economy from the global financial sector crisis and recession in some of world’s biggest economies. But indices reversed little gains earned triggered by global woes despite announcement by the government to provide additional resources to stimulate demand and provide more help to key sectors such as housing, infrastructure and real estate. Intense selling was seen over the counters on the last day of the week as investors remained wary on concerns of a slowing domestic economy and weak global markets pulling Sensex below 9,000 level. The Indian benchmark indices, Sensex and Nifty finished the week registering losses to the tune of 8.22% and 7.18% respectively. Sensex ended the week at 8,843.21 down by a staggering 791.53 points and Nifty at 2,736.45 down by 211.90 points.