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Sensex falls 127 points on IIP woes

A disappointing 3.5 per cent decline in factory output in March saw BSE benchmark Sensex shedding 127 points - its fall for the fourth consecutive day - to register the biggest weekly loss of 3.2 per cent in 2012.

BT Online Bureau | May 11, 2012 | Updated 17:53 IST

A disappointing 3.5 per cent decline in factory output in March saw BSE benchmark Sensex shedding 127 points - its fall for the fourth consecutive day - to register the biggest weekly loss of 3.2 per cent in 2012.

The contraction in industrial production came as a jolt to the market already reeling under worries of a slowing economy and renewed concerns over the recovery in eurozone.

The bearish sentiments prevailed when the market resumed trading on Friday and the 30-share barometer fell further to its intra-day low of 16,233.76 after weak factory data trickled in. Sensex ended 127.07 points lower at 16,292.98, a drop of 0.77 per cent from its previous close. Investors became poorer by nearly Rs 48,000 crore on Friday.

In the previous three days, Sensex has lost nearly 500 points after a rupee threatened to breach 54-level against the dollar that spooked foreign funds.

Brokers said markets made a feeble attempt to rally and touched a high of 16,447.24 on hopes of rate cuts by RBI but failed to sustain the momentum. At close, 21 stocks in Sensex ended with losses, eight settled with gains. Interest-rate sensitive auto and banking sectors, however, posted gains.

The rupee, which had strengthened slightly post the RBI directive on Thursday, depreciated once again on Friday.

Tata Power, which closed with a fall of 4.89 per cent was the biggest loser in Sensex pack, followed by Sun Pharma, Hindalco, Coal India and Maruti. ITC, Cipla, ONGC, Wipro, Infosys and Larsen and Toubro lost in the 1-2 per cent range.

"The de-growth in IIP data for March came at sharp contrast to the IIP growth in February. Market reacted negatively to the data and slipped down further...the short term trend has become bearish as of now," said Rakesh Goyal, Sr. Vice President, Bonanza Portfolio.

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