The bad news of last week continues. Market players who had expected a revival of sentiment in the domestic equity market along with the much-awaited listing of Reliance Power Ltd (R Power) came in for a rude shock on Monday. After opening with huge downward gaps, the domestic equity bourses tanked along with R Power stock.
The dismal debut of R Power, along with weak global cues, resulted in the 30-share Sensex of the Bombay Stock Exchange posting its second-highest single-day loss, to close the day at 16,630.91 points, down by 833.98 points?or 4.78%?after losing more than 1,000 points in intra-day trades.
The broader S&P CNX Nifty of the National Stock Exchange also registered its second-highest fall ever, of 263.35 points, or 5.14%, to end the day at 4,857 points. Shahina Mukadam, head of equity research at IDBI Capital, said, ?The fall in the domestic equity indices was compounded by various factors. There is a strong fear of the US economy heading towards a recession that is prompting FIIs to pull out their money from India.?
?Secondly, the withdrawal of two high profile IPOs last week has given a clear indication of a temporary liquidity crunch being experienced in the market, resulting in a broader sell-off. Thirdly, the poor debut of the R Power stock also had a bearing on the overall sentiment in the market,? Mukadam added.