The Indian stock market continued its bearish run for the second day in a row on concerns over developed world’s economic recovery. On Friday, BSE Sensex lost 434 points (2.68%) to plunge below the 16,000 mark for the first time in the last three months. The S&P CNX Nifty dropped 126.7 points (2.61%).
European countries led by Portugal, Ukraine and Spain have raised debt worries, which the market analysts fear would be infectious. The players are more worried of the rising debts creating bigger troubles in the event of it spreading to countries like the US and the UK.
Investors turned cautious following reports that the applications for unemployment insurance in the US displayed an unforeseen rise. To add to the woes, companies such as Monster Worldwide and MasterCard posted earnings well below the estimated figures.
Europe’s sovereign debt concerns led to strengthening of dollar, which sent the commodity and energy prices spiraling on Thursday. The debt issue also had FIIs running for cover, with them selling heavily anticipating another economic crisis.
Stock markets across the globe fell for the second day on Friday. European markets’ loss on Friday was between 1.26% and 1.51%. Asian markets were the worst hit with the benchmark indices of China, Hong Kong, Taiwan, Japan, South Korea and Singapore plummeting between 1.87% and 4.30%.
The market selloff was broad-based with the indices for all sectors sinking drastically. Auto shares declined on the proposed additional duty for diesel vehicles. Infrastructure stocks fell fearing low governmental spending following weak response to NTPC’s follow-on public offer. The reported delay in 3G auction sent telecom shares plummeting. Bank and metal stocks too displayed jitters to end up among the big losers for the day.
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