Sensex ends at 3-year low, inflation fails to hold slide

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Mumbai, Nov 20: Indian equity indices slipped to their lowest in the last three years, on the back of intense selling pressure and increasing concerns of a global recession. Diminishing inflation numbers failed to hold the slide and the markets ended the day with loses for the seventh consecutive trading session in 2008.

The 30-share Sensex of Bombay Stock Exchange (BSE) shed 322.77 points, or 3.68%, to close at 8,451.01 points. Dealers in the market say weak cues from global markets, along with poor economic reports in the US and several global companies announcing job cuts, added to the gloom in domestic markets.

The broader S&P CNX Nifty of National Stock Exchange (NSE) slid 81.85 points, or 3.11%, and ended the day at 2,553.15 points. Arun Kejriwal of Kejriwal Research and Investment Services said, "Despite numerous measures taken by the central bank and the government, there is no respite for the Indian markets. We are witnessing a fear in the mind of investors and a lack of will power to invest at lower levels again." During the intra-day trading, there was some relief after the inflation data was released. The markets, however, could not sustain the gains. The wholesale price index (WPI) stood at 8.90% in the week ended November 8, as against the previous week's figure of 8.98%.

"If we see some relief from the intense selling by the foreign institutional investors (FII), we might witness some positive movement in the market. Heavy selling by FIIs has been a key factor behind the market's slide," said Kejriwal.

"They have sold stocks worth over $13 billion in the current year. We might witness more pains in the coming days as well," he added.

All of the BSE sectoral indices ended the day in the negative terrain, with realty and consumer durables being the worst performers of the day.