BSE Sensex falls 124 points on sustained political chaos, ends below 19K

The BSE Sensex slid another 124 points on Wednesday as investor confidence was dented by continued worries over the political chaos amid downbeat comments by the Reserve Bank of India (RBI) over further rate cuts.

The benchmark, ending the day's trade below the psychological 19K-mark, extended losses for the fourth straight session, despite firm European cues.

The 30-share index of the Bombay Stock Exchange (BSE) resumed in the green but later continued to reel under selling pressure and closed at 18,884.19, revealing a fall of 123.91 points or 0.65 per cent. The Sensex has tanked 686.25 points, or 3.51 per cent, in the last four sessions.

The 50-issue CNX Nifty of the National Stock Exchange (NSE) also slumped by 51.55 points, or 0.90 per cent, to end below 5,700-mark at a fresh 2-week low of 5,694.40.

Relentless selling has been seen for the last four straight trading days in shares from realty, power, capital goods, PSU, banking, metal and refinery segments.

DMK on Tuesday withdrew support to Congress-led UPA government on the issue of alleged human rights violations of Tamils in Sri Lanka. All five DMK ministers on Wednesday submitted their resignations to Prime Minister Manmohan Singh.

The RBI, while cutting short-term lending and borrowing rates (repo and reverse repo) by 25 bps on Tuesday, took a dovish stance against future rate cut due to high inflation, which also kept the market under pressure.

Second-line stocks were at the receiving end on Wednesday on heavy sell-off by retail investors ahead of expiry of derivatives contract on March 28 as BSE and NSE will remain closed on March 27 and 29 on account of "Holi" and "Good Friday", respectively.

Asian stocks closed mixed, with a rejection by the Cypriot Parliament of a European bailout plan fueling some uncertainty. Key indices from Singapore, South Korea and Taiwan settled in the red while from China and Hong Kong ended in the green. Japan market was closed for holiday.

However, European markets rebounded on Wednesday and were trading higher in early trade, with investors absorbing the latest developments in the Cyprus. The CAC was trading up by 0.73 per cent the DAX by 0.53 per cent and the FTSE by 0.43 per cent.

With PTI inputs