Mumbai, March 14: The ongoing crisis of confidence has hit almost every major scrip on the bourses. On March 13, 2001, the 30-scrip Sensex lost 227 points to 3540.65, a 22-month low. The global meltdown has aided it. The bearish grip on the market has seen many stocks hitting lower circuits. The sacking of the Bombay Stock Exchange broker-directors and the breaking out of the `Tehelka.com' scandal involving top defence and political persona has further created a sense of gloom in the market that is struggling to shrug off the bear grip. In this context, even a rally of 184 points in the Sensex on Wednesday does not appear convincing.Market capitalisation of stocks at the Sensex contracted by nearly 17 per cent to Rs 2,60,345 crore on March 13, 2001 from Rs 3,13,252 crore on February 28, 2001. The four ICE stocks, Infosys, NIIT, Satyam and Zee, have been the worst hit. Consequently, market cap of these stocks contracted by 35 per cent to Rs 41,392 crore over February 28, 2001. On Tuesday, the S&P CNX 500, a broader index, witnessed its market cap reduced to Rs 4,82,293 crore from Rs 5,70,972 crore as on February 28, 2001.
During the period under consideration, market cap of pharma stocks fell by 9 per cent to Rs 35,283 crore from Rs 38,882 crore. Market cap of FMCG stocks has contracted by 5.7 per cent to Rs 90,764 crore from Rs 96,293 crore. Even the MNCs could not withstand the whirlwind. Their market cap fell by 7 per cent to Rs 86,835 crore from Rs 93,680 crore during the same period.
Mumbai stock market, India's premier bourse, responded with gusto to the 2001-02 budget with a jump of 171 points on the budget day. Since then, it has been a story of falling leaves in a blistering winter what with major stocks hitting lower circuits.
The Securities and Exchange Board of India (Sebi) was seen coming out with various measures to restrict the slide in the market, but to no avail.
Wipro, the then market cap leader, has witnessed its market cap dropped drastically since budget announcement. Its market cap was at Rs 59,160 crore on February 28, and currently it stands at Rs 37,028 crore. Hindustan Lever (HLL) has also lost significant pound in its market capitalisation. HLL's market cap, which is currently valued at Rs 47,455 crore, was at Rs 50,481 crore. Infosys Technologies, the investors' darling, has lost its charm considerably and, eventually, its market cap stands at Rs 31,156 crore from 41,400 crore. Companies like Satyam Computers, Zee Telefilms, Himachal Futuristic are also at the receiving end.
The Sensex has responded positively to the finance minister's slew of measures by jumping up 184 points to 3725.03 on Wednesday. Even stocks such as Infosys Technologies, Wipro, NIIT, Satyam Computers, Zee Telefilms have gained by nearly 10 per cent to 12 per cent. How long will this rally last remains to be seen.
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
